Invest in the wisdom of customers

Individuals and employers should be given more opportunity to shape a simplified skills agenda

By Michael Davis

Last month, my eight-year-old daughter offered me a swimming lesson.  For £5, she gave me an hour’s tuition in ‘tumble turns’.  Patiently, she broke down the technique for me – gambol in the water, kick off, then invert yourself before coming down to land with both feet together.  But after 30 minutes of determined coaching on my daughter’s part and near-death experiences on mine, the lesson ended.  What was very simple for her was very complicated for me.  Apparently, I just didn’t “get it.”

Back in the office, I find myself comparing the UK’s skills and employment systems with tumble turns.  Like tumble turns, each individual part seems to be simple enough.  When you speak with individual players – and there are many – you will get a spirited and coherent explanation as to why the work they do is so important and pivotal to the smooth running of the system.  They acknowledge that yes, of course the system as a whole is complicated and inefficient – but that’s to do with other people; it’s never their fault.

Persuasive as these individual arguments may be, when you link them together you do not achieve a collective where the whole is greater than the sum of its parts.   Like my failed attempts at tumble turns, the system doesn’t come together as a seamless whole.  Each organisation’s responsibilities grind against one another at the margins of their territories, resulting in duplication, inefficiency and confusion.

If you assume that the government is the overall architect, and they can articulate the grand vision, well, you’d be wrong.  An all-party commons committee report, published at the beginning of the year, referred to the complex system of interlinked public bodies, funding sources and rules for skills training as a “dog's breakfast, impenetrable to everyone apart from possibly a few civil servants and a handful of academics."  Ministers have been calling for radical simplification for some time, and last year tasked the UK Commission for Employment and Skills with recommending ways to achieve this.

Over the summer, we ran an informal consultation to help us establish what needs to change to make current services more responsive to customer needs, integrate the delivery of employment and skills services, and achieve significantly greater impact with fewer public resources.

We concluded that the root cause of the current complexity is two-fold:

  * Current employment and skills services are not sufficiently integrated with one another and neither are aligned to labour market needs;

  * Customers – that is, employers and individuals – are not empowered, informed and trusted sufficiently to drive demand, performance and quality.

 At the moment, the main output sought in the employment system is getting people without work into jobs.  That’s hugely important and should never be underestimated, but the type of job – how sustainable it is, the type of skills it requires and the progression it affords – is largely overlooked. Consequently, we have the all-too-familiar merry-go-round where individuals come off benefits to get a job for a few weeks before becoming claimants again.

 Similarly, on the skills side, a preoccupation with qualifications (an output) has caused us to lose sight of the final desired outcome – sustainable employment with skills and progression.

 In both instances the remedy is the same: integrate employment and skills services more, focusing on the alignment of goals, and make both ‘parts’ worry more about the same things.  Specifically, we believe that employment services should be managed on the basis of progression (wage gain) and skills, as well as just job starts.  And skills services would reciprocate by defining success in terms of not just qualifications success, but progression either in learning or work.  Both would also add customer satisfaction as an outcome – employer and individual. By focusing on outcomes, rather than outputs, we would help ensure that publicly-funded employment and skills services continue to be concerned about progression and helping their customers up the next rung of the ladder at every stage.

 The second proposition is that the current system is excessively complicated because we do not empower customers to effectively drive service volumes, performance and quality.  Lots of intermediary organisations and partnerships exist to manage delivery on behalf of customers rather than giving customers the information they need to do this themselves.  As an analogy, take the system of food labelling introduced by the Food Standards  Agency some three years ago.  By being given consistent, easy-to-understand information about fat, salt, calories and so on at point of sale, we, the public, are encouraged to consume healthier foods. 

In the same way, we’re proposing that easy-to-understand, easy-to-compare information on employment and skills services should be available to customers at ‘point of purchase’.  Information on learning success, customer satisfaction, progression (in work or in learning) and wage gain should be provided as the most realisable evidence of progression and quality.

We believe there is too much ‘demand management by proxy’ with significant resources invested in the tools of planners to help them manage the system rather than simply turning that information over to consumers – who, after all, have the greatest vested interest in receiving a good service. 

The change would not be painless.  How many people would rationally sign up for a course – particularly in higher education, where you have to contribute towards the fees – knowing that few previous participants got a job at the end of it, or that the drop-out rate was twice the national average?  And how many colleges, universities and providers would be happy to advertise that their courses have a customer satisfaction rate of less than 50 per cent?  By making the system more transparent, we can expect to see good provision which meets the needs of employers and learners flourish, whilst less-good provision is forced to improve or slowly wither on the vine.  Customers will be driving performance.

We could simplify swathes of the system if we invested in the wisdom of customers and allowed public funding to follow their choices.  Link this back to the first proposition of integrated employment and skills services commissioned against common outcomes and to me this is a powerful proposition for helping people progress in work through skills.

To find out more about this article, visit: http://www.ukces.org.uk/upload/pdf/skills_jobs_growth_finalpdf_231009.pdf

9 November 2009

Michael Davis. Director of Strategy and Performance at the UK Commission for Employment and Skills ,