Enterprise and Skills Strategic Board: key achievements and lessons

4. Key Lessons Learned

The extensive work over the past five years of the ESSB has provided valuable insights and lessons for how the system can have greater impact in the future. This strikes at the heart of the New Culture of Delivery programme in the NSET and the future role of the NSET Delivery Board:

While the ESSB was successful in driving greater alignment and collaboration across the enterprise and skills system, the ESSB's limited powers have prevented far greater progress being made. For example, the ESSB did not have powers to compel agencies to implement its recommendations. In areas such as skills alignment this meant that progress was too slow in implementing the necessary changes to enhance the performance of the system. Furthermore, the ESSB had no powers to address underperformance within the system as it played no role in setting the budget or resourcing levels for the agencies. SG and Ministers need to be bolder if agencies are not delivering. Clarity of lead agency or organisation and strong accountability are essential to success.

Fewer priority outcomes with a clear focus on execution is better than a wealth of smaller actions. Over the past five years a number of reviews and strategies resulted in a large volume of actions falling to the agencies to deliver. There was a lack of join-up between these actions, as they were often identified in isolation, and inflexible financial arrangements – particularly strict criteria around multi-year funding – hampered the successful delivery of actions. This was at a time when agencies were under pressure from the UK's exit from the EU and the pandemic.

Greater financial flexibility would help prevent some of the current perverse incentives across the system which drive the need to spend budgets before the year-end rather than the investments which will generate the greatest returns to the Scottish economy. There is an opportunity to utilise any underspends to support growth areas in the Scottish economy or enhance R&D investment.

Greater consistency in monitoring and evaluation, with a step change needed. At present the level and quality of monitoring and evaluation are mixed and generally limited. In addition, businesses might be receiving help from various agencies but each agency will only hold their information on the interventions. It would be far better to have a holistic approach with shared data and evaluation of delivery. NSET specifically recognises the need for consistent evaluation to drive continuous improvement and greater understanding of the return on investment and assessing the impact of support which will guide future spending decisions.

Data sharing and analysis across the system to enable agencies to better tailor and target their products and services to meet user needs. This links in to the NSET action for common datasets and systems.

Clearer mechanism for sharing resource. Although there was some success with agency fluid teams in the Business Models and Workplace Innovation mission, more areas could have benefitted from this approach. Moving forward we should look for more opportunities to share resources and expertise as part of a genuine Team Scotland approach. For example might we have one enterprise agency leading on supporting business innovation?

Build on the work underway by the Business Support Partnership to align and simplify the support on offer to business. No new support services should be created by any part of the system without first being run through a process to establish (1) whether something already exists in this space, (2) what opportunities exist for collaboration. A core deliverable for the Partnership is a cross-agency CRM. This is a major undertaking but would enable a much more effective understanding of system wide activity and enable the system to:

• use data that helps more effectively target our interventions;
• measure the impact of our interventions; and
• better predict the optimum levels of support.

Greater policy consistency within SG is needed together with clearer Letters of Guidance – which are annual letters from Ministers to the agencies setting out the strategic priorities. At present the agencies feed into a number of different policy areas across the SG and report to different Ministers for different purposes. This can sometimes result in competing priorities when it comes to resources. In addition the Letters of Guidance for each of the agencies vary considerably. The use of Outcome Agreements instead of Letters of Guidance might be a good step forward. NSET recognised the need to ensure strategic guidance to agencies aligns with the priorities and delivers the programmes of action set out in the strategy.

There needs to be a clear engagement path to industry which goes beyond the business representative organisations. The ESSB has made progress linking in with the Industry Leadership Groups and this needs to be built on going forward if ambition within NSET for a Team Scotland approach to delivering the strategy is to be realised. There needs to be an open line of communication and knowledge exchange between the NSET Delivery Board and the ILGs.

SG structures are too complicated and result in mixed messages to agencies around targets and priorities for delivery. There is an opportunity to reorganise SG structures so they align with the NSET programmes and the new Accountability Framework will clearly articulate the roles and responsibilities of those delivering NSET. In addition, the movement of senior staff within SG on a fairly regular basis does not allow for consistency of planning and delivery is hampered by loss of 'corporate memory'. Appropriate succession planning would help to alleviate this.

There is still a strong need to improve productivity levels. Two enablers of this are digital adoption and embedding R&D into businesses. These must be addressed by Government otherwise productivity will not shift at a fast enough pace.

Economic growth is a complex process relying on a large number of factors. When agencies are planning and adopting policies it would be beneficial for them to consider areas such as transport and housing – as these are often challenges which are impacting on local economic development growth.