Employers work together on skills and innovation to enhance business performance in a number of ways and some of these are demonstrated in a number of studies. The first highlights the results of the CBI’s Skills Project. The second  analyses the attempts made by a development project to support the learning of individuals and organisations in supply chains in the automotive and aerospace industries.

Results from CBI skills project

The CBI’s Skills Project showed the ways employers work together on skills and innovation to enhance business performance. The final report is available from a link from the DfES skills strategy website. The report argues that the link between higher skills levels and higher levels of business performance is increasingly recognised, although there is a continuing need to demonstrate the 'business case' for skills. In 2003, as part of the government’s Skills Strategy, the Department for Education and Skills (DfES) asked the CBI to identify how businesses can enhance their performance by collaborating to increase skills and innovation in clusters and supply chains, and to help stimulate further development in this area. The CBI examined the extent, objectives, nature and benefits of employer collaboration on skills, as well as drivers and barriers to success. The research programme included a detailed survey questionnaire that was dispatched to around 5,000 CBI member organisations – attracting responses from more than 400 employers – backed by some 30 follow-up case studies, together with desk-based in-depth investigations. The results, given in full in the report 'Employers collaborating to raise skills in supply chains and clusters', indicated that:

'Almost without exception, the employers in our study who collaborate on skills report that this activity has a positive impact on business performance. The most common specific business benefits to collaboration are improvements in employees’ competence, working practices, product/service quality and customer satisfaction.

Employers collaborate on skills in a variety of ways – most commonly working together in a sector, although there is also considerable collaborative activity on skills in the local area and in the supply chain.

The nature of skills collaboration is driven by business needs and hence encompasses a wide variety of approaches – for example, large companies might open their training facilities to smaller firms to ensure high-quality skills in the supply chain; while small or medium-sized firms might work together to bid for contracts for which they would not have the full skillset individually. However, some characteristics are universal – for instance, the ability to gain economies of scale by sharing training costs.' (p.3).

The research identified two main models of collaboration: the 'hub-and-spoke' approach where a large employer supports improvement activities among smaller firms; and small or medium-sized enterprise (SME) collaboration involving sharing mentoring, skills or learning programmes or pooling skills to compete more effectively for contracts. The research identified four broad types of business grouping for employer collaboration: local area–related sector (the 'classic' cluster); local area–disparate sector; national sector; and the supply chain. 

'The most common specific aim of collaboration is to improve employees’ job specific skills, and there is also considerable interest in developing employees’ generic skills such as teamworking and communication. However, many collaborations have specific business objectives, for example, employers working together in the supply chain often concentrate on process improvements.

Skills collaborations most commonly involve higher-level employees, particularly managers; this trend is particularly pronounced in SMEs, where directors and managers are considerably more likely to be involved, as collaboration often involves sharing of technical or managerial expertise or mentoring.

The primary factors fostering success are the involvement of firms facing similar business problems or challenges, the commitment of senior managers and the availability of tailored training. However, these vary according to the size of firm, with external facilitation particularly important to smaller firms.' (p.4).

Drawing on the findings from the survey and case study research together, the key messages about the drivers of business skills collaboration were: 

'what gets them under way initially. These include: the vision of key individuals at varying organisational levels – ranging from managing director to personnel officer level – is often vital; approaches by larger firms are also an important driver; and initiatives by industry forums or external organisations can also drive collaboration.

For skills collaboration to be sustained in the long-term, the case study research is helpful in drawing out key messages, which include: senior-level commitment must be maintained to ensure long-term success; change agents can be invaluable in institutionalising skills gained from collaborative working; and pump-priming funding,
where available, must be employed effectively to promote long-term success.

A lack of opportunities acts as the major obstacle to employer collaborations on skills; while other significant barriers to collaboration include confidentiality concerns (for example, working with competitors) and lack of time or resources.' (p.4.)

Full reference:

• CBI (2005) Employers collaborating to raise skills in supply chains and clusters, London: CBI.

KLASS project: learning in advanced supply chains

This paper analysed the attempts made by a development project on Knowledge and Learning in Advanced Supply Systems (KLASS), funded by the Department of Trade and Industry (DTI) and the European ADAPT programme, to support the learning of individuals and organisations in the automotive and aerospace industries. The project sought to support small and medium size enterprises (SMEs) through inter-company, computer mediated, learning networks that have a strong focus on both immediate performance improvements and longer-term educational objectives. The underlying pedagogical idea is that there is considerable value in attempting to link processes of knowledge creation with tackling the core problems of manufacturing practice as a means of engaging learners that have traditionally been difficult for educational institutions to reach. The model of learning used with its emphasis upon networking, knowledge creation, linking an initial focus upon performance with a progressive broadening of ideas about learning and development was particularly well suited to its context: supporting learning and development in advanced supply systems. However, the scale of the effort and resources required to make the project successful means that considerable challenges would remain if the model were to be successfully implemented in a range of other contexts. For the full report, follow the link below. 

KLASS project: learning in advanced supply chains

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This contribution is based upon a conference presentation prior to publication of the chapter in Rainbird et al. (2004).