UPDATE ON WORK OF THE SKILLS UTILISATION LEADERSHIP GROUP
1. Workshop discussions took place at the October 2008 National Economic Forum (NEF) on making better use of skills. Following those discussions, the Government gave a commitment to report progress to the NEF on the ongoing work of the Skills Utilisation Leadership Group. Chaired by Michael Russell, the Cabinet Secretary for Education and Lifelong Learning, the Group brings together leaders from government, business, trade unions, the third sector and key public agencies to champion the better use of skills in the workplace. Since the last NEF, the Group has been joined Keith Brown, the Minister for Skills and Lifelong Learning, and Professor Ewart Keep.
2. Scotland has a relatively good record on skills qualifications compared to the rest of the UK. Yet this potential competitive advantage has not translated as well as it could into enhanced economic performance.
3. Skills development is vital. However, it is the productive use of skills in the workplace that can make the difference. The Scottish Government is therefore encouraging organisations to embrace workplace cultures that enable people to better use their skills - to increase productivity, performance and create better, more satisfying jobs .
4. Effective skills use is about:
- confident, motivated and relevantly skilled individuals who are aware of the skills they possess and know how to best use them in the workplace
- workplaces that provide meaningful and appropriate encouragement, opportunity and support for employees to use their skills effectively
in order to
- increase performance and productivity, improve job satisfaction and employee well-being, and stimulate investment, enterprise and innovation.
5. Improving the use of skills is not something that government alone can achieve because change of this nature is change that has to take place in individual workplaces with the commitment of both employer and employee alike. Effective leadership, management and employee engagement are the key enablers of meaningful and sustainable workplace change.
6. The key actions arising from the Group's work to date are:
- Scottish Enterprise, Highlands and Islands Enterprise and Skills Development Scotland are reviewing and revising their range of business/organisational development support services to ensure that they support effective skills use.
- The Scottish Funding Council announced in June funding of £1.8m over two years to support twelve college and university led projects to improve how skills are used in the workplace.
- The Leadership Group adopted a strategy in June to engage employers in making better use of skills, which includes taking a sectoral approach. To help implement the strategy, a cross-sectoral network was established in September. Its role is to connect sector leads and a range of other organisations to enable them to work together and support each other.
- Twelve case studies were published in January 2010 highlighting how firms encourage effective skills use to demonstrate the relevance of this agenda to employers and employees. These are highlighted on website developed by the Government has to provide advice on making better use of skills - www.scotland.gov.uk/skillsuse. The website will grow as more resources become available.
- The Scottish Government has made a corporate commitment to improve the use of the skills of its workforce, as has Scottish Enterprise, Highlands and Islands Enterprise, Skills Development Scotland and the Funding Council. Other public bodies are being encouraged to consider how well the skills of their workforce are being used and to take action, where appropriate, to encourage and support their better use.
- The discussions at the December NEF 2009 formed part of the evidence base for the Scottish Government's review of leadership and management. Having considered those discussions and other evidence sources, the Leadership Group agreed in April 2010 where to focus the review. Further information is outlined in the Annex.
LEADERSHIP AND MANAGEMENT REVIEW IN SCOTLAND
1. Leadership and management are key contributors to the Scottish Government's Purpose target for Scotland to be in the top quartile for productivity against our key trading partners in the OECD by 2017.
2. By encouraging more effective leadership and management we seek to raise business ambition and to help increase the capacity of organisations to realise their ambitions. That said, raising business ambition is more than just a product of leadership and management development. This review therefore needs to be seen against the wider context of the Government's Economic Strategy.
3. The Skills Utilisation Literature Review  highlighted, leadership and management and employee trust and motivation (which is itself a product in part of effective leadership and management) as key factors that enable the meaningful and sustainable introduction of workplace practices that support effective skills use. As the Skills Utilisation Leadership Group itself has identified, leaders must "set a clear direction and purpose, surround themselves with the best available talent, and then motivate, inspire and support them to do their best as individuals and as a team". Management is fundamental too as it is management that translates vision into action on the ground.
4. The influence of leaders and managers is all-pervasive. They can be major constraints. They can also be key enablers, supporting business productivity and growth, boosting survival and competitiveness while also helping business manage change in a period of significant business uncertainty. The development of progressive and innovative leadership and management is an issue that is common across all drivers of productivity, affecting how enterprising a firm is, how it innovates, invests, responds to competition and how well skills are used. If we want firms that are more ambitious, innovative and successful, we need more ambitious, innovative and successful leaders and managers.
5. There would appear to be a number of opportunities to encourage more progressive and innovative leadership and management in Scotland.
- Culture. Leadership and management are not highly valued in Scottish society generally. There are not enough visible role models.
- Importance. There may not always be enough importance attached to effective leadership and management at all levels in organisations.
- Understanding. The distinction between leadership and management is not well understood. One of the effects of this is that some leaders spending too much time managing and not enough time leading.
- Behaviour. Not enough leaders and managers exhibit progressive and innovative behaviours that enable individuals to perform at their best.
- Self-awareness. There is scope to help some leaders and managers, particularly in SMEs, to realise that it may be their lack of leadership and/or management skills that is constraining their organisations. They may be unaware of the need to develop their skills.
- Information, advice and guidance for employees and employers. There is a lack of relevant information on the difference that good leadership and management can make to organisations. Information, advice and guidance is not readily available on:
- the range of leadership and management development activities that are available;
- what form of leadership/development may best suit an employer's needs;
- what activities are publicly supported;
- who is eligible for support; and
- where to go to for that support or for further information.
- Measurement. There is no agreed framework for the measurement of effective leadership and management.
- Evaluation. There is a lack of tools that can evaluate leadership and development activity effectively.
Existing or Planned Activities
6. A number of activities are currently being undertaken or are planned to be undertaken to address some of these issues. These are:
- Scottish Enterprise's recent policy on leadership development will address raising awareness, providing information and encouraging action in businesses.
- Improvements will be made to Skills Development Scotland's National Learning Opportunities Database to ensure it covers all leadership and management development activity
- A second Scottish Enterprise/Institute of Director's sponsored 'leadership conversation' will be held on 29 April to encourage collaborative, business to business approaches to leadership development
- Enterprise agencies are improving the visibility of role models and available support through existing networks and use of latest web technologies
- Building the Curriculum 4  identifies leadership skills as skills for learning, life and work and shows how they are embedded in Curriculum for Excellence .
- The Scottish Funding Council's employability strategy Learning to Work, published in 2004, identified management and leadership skills amongst those skills, attributes and knowledge required for effectiveness in the workplace. In taking forward its action plan for Learning to Work Two in 2010, the Funding Council is looking to explore how college and university workforce development provision could contribute to enhancing leadership and management capacity.
Areas of Future Action
7. The Review will focus on the following areas of future action:
- Develop a common vision of Scotland with progressive and innovative leadership and management relevant to all sectors (Opportunity 1 and 2).
- Scottish Government to identify enterprise agencies as the 'lead' public agencies responsible for encouraging leadership development, recognising that a key role will be for them to work in partnership with other public and third sector agencies and stakeholders (Opportunity 5)
- Highlands and Islands Enterprise to develop a leadership development policy (Opportunity 1-4).
- Develop more collaborative approaches between academia, public sector and business to address leadership development in Scotland. (Opportunity 3).
- As part of a focus on employability outcomes and measures, colleges and universities to share good practice on how leadership skills are being developed effectively across different curriculum areas and the impact of this on the individual and the employer. (Opportunity 1-5).
- Agencies and other stakeholders, including Sector Skills Councils, to share good practice on how they engage employers successfully in leadership and/or management development activity (Opportunity 5)
- Facilitate organisations (particularly SMEs) to come together to learn from each other and support each other to, among other things, develop leadership and management development. Agencies to have regard to UKCES's forthcoming report on leadership and management when considering how best to take this forward. (Opportunity 1-6).
- Develop private, public and third sector case studies that explore:
- the range of different practices organisations employ to develop leaders and managers and the challenges organisations face;
- the impact that effective leadership and management can make to organisations; and
- the difference public sector support has made to organisations (Opportunity 1-6).
- Improve the accessibility of information, advice and guidance (IAG) on leadership and management, aligning it where appropriate with work that may arise from recommendations from the Workforce Development Action Group  on improving workforce development IAG (Opportunity 6) .
- Invite UK Commission for Employment and Skills to consider the measurement of effective leadership and management as part of the development of a framework for the measurement of effective skills use (Opportunity 7).
- Develop a framework to enable effective evaluation of leadership development activity (Opportunity 8).
- Invite universities to consider whether their management development programmes enable the development of progressive and innovative people management skills (Opportunity 4).
- Consider, when published, the implications for Scotland of the findings of BIS commissioned research into leadership and management and of the findings of the Equalities and Human Rights Commission commissioned project on leadership development.
 The joint Scottish Funding Council and Skills Development Scotland Skills Committee has commissioned a Workforce Development Action Group to:
- agree a shared definition of workforce development;
- simplify the language for employers;
- define clearly the provision that colleges, universities and training providers offer to businesses and individuals;
- increase demand for workforce development through industry gateways and the talentmap portal; and
- take a sectoral approach, focusing on key sectors, starting with tourism and food and drink manufacturing.