Management Development Programme - A Review of MCI and the DTZ Pieda Consulting
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A Review of MCI and the
Management Development
Programme
DTZ Pieda Consulting
D... ..
"bB.nt for
RESEARCH REPORT RR67 EducatIoII ..... Empl.,ment
Research Report
No 67
A Review of MC! and the
Management
Development Programme
DTZ Pieda Consulting
The Views expressed in this report are the authors' and do not necessarily reflect those of the Department for Education and Employment.
.:. Crown Copyright 1998. Published with the permission of DfEE on behalf of the Controller of Her Majesty's Stationery Office. Applications for
reproduction should be made in writing to The Crown Copyright Unit, Her Majesty's Stationery Office, SI elements House, 2�16 Colegate. Norwich
NR31BQ.
ISBN 0 85522 790 7
July 1998CONTENTS
SECTION PAGE
EXECUTIVE SUMMARY ........ . ............... . . . . . . . . . . . . . . . . . . ..... . . . . ............................. ............ i
I. INTRODUCTION .......... . . . . . . . . . . . . . . .. . . . . . ........................................ ............................ ...... 1
2. MANAGEMENT DEVELOPMENT AND THE
COMPETITIVENESS PROGRAMME . . .............................. . . . . ......... ........................... 5
3. IMPACT OF MCI ON INTERMEDIARY ORGANISATIONS ...................... .......... II
4. IMPACT OF MCI ON EMPLOYERS .
. . . . . . ......... ....................................................... 19
5. IMPACT OF MANAGEMENT DEVELOPMENT ON EMPLOYERS .................... 25
6. KEY FINDINGS AND CONCLUSIONS ..... .............. .................... . ................ . .......... 29• A Revi ew of MC! and t h e ManagementD evel op ment P rogramme·
EXECUTIVE SUMMARY
I. This study was commissioned by the Department for Education and
Employment (DjEE) to examine the wider impact of the Management Charter
Initiative (MCI) on organisations undertaking management development and
the intermediaries who work in the market place to promote and deliver such
opportunities.
OBJECTIVES OF THE STUDY
2. The study had the following objectives:
• To review and assess employers awareness of the opportumtIes to
undertake management development, and the availability of specific
management development products
• To review the level of actual take-up of these opportunities, and assess
to what extent MCI activities have impacted upon this
• To identify the resulting impacts of management development on
businesses, and
• To review the impact of MCI supported actIvItIes on intermediary
organisations who promote and/or deliver management development.
3. The research has drawn on several sources of information. Previous
evaluation reports, commissioned by both the DjEE and the MCI, have been
used. Such work generally reports on surveys of narrow target groups
involved in management development activity (e.g. TECs, Business Schools,
SMEs, etc). In addition to these, wider scoping work on the extent of
management development currently being undertaken in England has also
been referred to.
THEMES OF THE REVIEW
4. The themes outlined overleaf have been used in assessmg the extent and
impact of MCI related management development:• A Revi ew of Mer and t h e ManagementD evel op ment Programme· 11
• Impact of MCI on the intermediaries who promote and provide
management development
Awareness and understanding of MCI
- Use of management development products/services
- Satisfaction with MCI products/services
- Impact of MCI on the provision of management development.
• Impact of MCI on employers
- Awareness of the MCI and its role in management development
- Awareness of management development issues and opportunities
- Take-up of management development by type of activity
Take-up of specific MCI Products
- Obstacles to additional take-up of MD.
• Impact of Management Development on employers
- The scope and scale of business benefits associated with management
development activity in firms.
CONCLUSIONS
5. The following conclusions were drawn from the review of MCI actlVlty
nationally, and the more local responses available from TECs and Business
Schools around the country:
• there are mixed messages on the level of MD activity being undertaken
in England. However, much of the confusion that exists in the various
reports on the scale of MD activity appears to result from the particular
definition taken of what MD is
• in general, more MD activity is taking place now than a decade ago
and the trend appears to indicate an increase in overall activity in future• A Revi ew of MC! and th e ManagementD evel op ment P rogramme· III
• the increased level of activity is not focused on any one sector or size
band of finn in particular although larger finns tend to undertake
slightly more MD training per employee than SMEs
• current MD activity is made up of a mix of MD training activities
marketed to companies by external intennediary organisations and,
often less fonnal, in-house developed activity (for which no accurate
national records are kept)
• there is an apparent shift towards the increased use of in-house MD as
opposed to 'bought in' activities. This particularly appears to be the
case where finns have used external products in the past and are now
tailoring these to their own requirements
• whilst MCr has undoubtedly affected the national provision and take
up of MD in a positive manner - most notably by developing
management standards - there is little knowledge of the MCr among
end users of MD products and services
• intennediary organisations, with which the MCr has been working
have benefited from the regional structure of advisors that MCr has
provided
• however, there appears to be a significant degree of risk attached to the
regional advisor model in marketing the MCr. The regional model
implies that links are principally being made between individuals and
not organisations. As a result, the distribution of the MCr message
further into an organisation can be limited and is also at risk from staff
changes in intennediary organisations
• significantly lower benefits can be identified with specific MCr
products. This is due to a range of factors including a perception of
relatively high prices for materials, a relatively low impact realised
from the marketing of MCr (especially of free materials) and a
perceived lack of applicability to finns
• many TECs are unaware of the Competitiveness Programme in name,
but have been involved in using materials developed under the
Programme
• no clear linkage between MD and bottom line business benefits can be
identified by finns. Instead of seeking clearly identified goals, many
finns are undertaking management development in the belief that it
will bring general improvements to their operations. Furthennore,
there is a general consensus that benefits may accrue over a fairly long
period of time.A Review of MC! and t he ManagementDevel op ment P rogramme· I
1. INTRODUCTION
1.1 This report is submitted as part of a wider work programme by DTZ Pieda Consulting
for DjEE. The wider research brief has been to provide an evaluation of the bottom
line business benefits of management development (MD) activities supported by the
Management Charter Initiative (MCI) whether directly or indirectly. The current
report reviews the policy environment within which MCI has been working, the issues
surrounding MD in general and, with reference to previous research, reviews the
impacts of the MCI to date on organisations involved in delivering MD and the firms
participating in various MD activities.
1.2 The research outputs are two-fold. First, this report provides a review of the wider
Management Development Competitiveness Programme (hereinafter 'the
Programme') and previous work that is available on the activities related to MD and
the MCr. A second report, prepared as part of the same research exercise, provides an
evaluation of the business benefits attached to management development activities in
firms. This draws on a national survey of firms that have recently participated in a
range of management development activities.
B A CKG ROUND TO THE REVIEW
1.3 Figure 1.1 summarises previous evaluative research applicable to the delivery of MCI
sponsored MD activity.
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. ... . •••• • • •• fl'eyi�,�s,:�_. �.�_g. e_fu�q_t(Il��I.(,:p��nt.'��ielYs:A Revi ew of MCI and t h e ManagementD evel op ment P rogramme· 2
1.4 The current report draws on this literature to provide an assessment of the scope and
scale of MD activity delivered and the key issues surrounding the role of MCI in the
process 1. In particular, we have drawn together the available evidence in terms of the
following:
• employers' levels of awareness of management development - in terms both of
its importance and the opportunities available
• employers' take-up of opportunities for training
• the resulting impacts of MD on business performance
• the impact of MCI supported activities on intermediary organisations who
promote and/or deliver MD
• the impact of promoting MD on available products and MD events.
1.5 In undertaking the review, we have not utilised the findings from our own survey of
firms. This analysis is contained within a separate report, which focuses on the
specific nature of the benefits to firms from management development activity and
whether a clear and quantitative link between MD and bottom line business benefits is
identifiable and measurable.
S TRUC TURE OF THE REpO R T
1.6 The report follows in Section 2 by summarising the development of public sector
involvement in management development - leading to the ultimate formation of the
MCI - in respect of the wider UK government's competitiveness progranune.
Sections 3 to 5 then follow by providing a review of evidence to date. Section 6
draws the key findings of the review together. The review has been grouped into the
following themes:
• Impact of MCI on intermediaries promoting / providing M D (Section 3)
- Awareness and understanding of MCI
- Use of MD products/services
- Satisfaction with MCI products/services
- Impact of MCI on MD Provision
1 In the current report we restrict ourselves to an analysis of MD in England only.A Review of MC! and t he ManagementDevel op ment P rogramme· 3
• Impact of MC I on employers (Section 4)
- Awareness of MD opportunities and the MCr
- Take-up of MD activity by type
- Take-up of specific MCr Products
- Obstacles to take-up of MD
• Impact of Management Development on employers (Section 5)
- Business benefits
• Key findings of Review and Conclusions (Section 6)A Revi ew of MC! and t h e ManagementD evel op ment P rogramme· 5
2. MANAGEMENT DEVELOPMENT AND THE COMPETITIVENESS
PROGRAMME
M AN AGE MENT DEVELO PMENT, F IRM CO MPE TI TIVENESS AND N A TION AL POL ICY
2.1 Over the past decade many organisations have begun to recognise that a change in
internal management functions, closely linked to the need for newer and more flexible
ways of doing business, has been necessary. Many firms have therefore identified a
need to equip newer generations of managers - and older managers lacking formal
management qualifications - with appropriate attitudes, skills and experience to
undertake their jobs effectively.
2.2 At the same time, a progressive shift among policy makers towards an appreciation of
the role of management training in improving firms' competitiveness has become
apparent. In particular there has been a shift from the promotion of simple initiatives
using external sources to tackle specific projects, towards more sophisticated and
holistic approaches. These have sought to develop the management capacity and
competence of firms and, as a result, increase their overall competitiveness.
2.3 The role of management development in improving competitiveness was formalised
in national policy making through the Government's Competitiveness White Paper of
2 As a direct result of the White Paper, the UK Competitiveness Programme
1993
was launched in 1994, with two further White Papers building progressively on the
agenda set out by the first.
2.4 One dimension through which the Competitiveness Progr amme has been seeking to
improve UK firms' competitivity is the targeting of groups within the (current and
potential) workforce for enhanced learning opportunities. The concept of 'lifelong
learning' has become central to this. It is now widely accepted that through enabling
lifelong learning and extending the range of opportunities for learning - whether in a
formalised channel or not - firms can increase the quality of their workforce and thus
improve their competitive position. Two wider developments connected with lifelong
learning have had a bearing on management development.
2 The increasing importance of the link between management development and competitivity was not
constrained to the UK. The Commission of the European Communities report Growth. Competitiveness,
Employment: The Challenges and Ways Forward into the 2 t" Century was published during 1993, highlighting
the role of management development. Similar work can be identified in a number of international HR and
management j ournals at this time.A Review of MeI and t he ManagementDevelop ment P rogramme· 6
2.5 The first involves the Investors in People (liP) process which is an employer led
programme, but also provides an opportunity for employees to improve their skills
through training or qualifications. Management training represents one of these
opportunities. In turn, the firm involved in gaining the liP accreditation benefits from
a more focused and experienced workforce and, through managers' interaction with
those in other companies, the translation of good management practice from
elsewhere.
2.6 The second lifelong learning approach is the promotion of competence based
accredited management qualifications via a lead body for management - the
Management Charter Initiative (MCI). In practice, these two components - one inside
the Programme, the other outside of it - have worked along side each other.
THE ROL E OF THE M AN AG E MENT CH A R TER INI TI A TIVE
3
2.7 The MCr was formed in 1988 and became the national lead body for management in
1990. Lead body status led to the MCI's key role in designing and delivering a
strategic framework of standards for management NVQs/SVQs. The resulting
framework was devised through an examination of best practice across a full range of
management functions - and levels - in a cross-section of over 3,000 firms of all types
and size.
2.8 The Mcr is not an accreditation or training body itself. Indeed, no clear rationale
exists for centralised intervention of this form. Accreditation of competence based
management development (CBMD) qualifications is undertaken by the Qualifications
and Curriculum Agency (QCA) and the Scottish Qualifications Agency (SQA).
Training delivery is undertaken by various training providers, such as private sector
training companies, business schools and higher education colleges, with promotion
and funding assistance being undertaken by TECs and Business Links. The use of
this existing network was thought to be the most cost effective and practicable method
of delivering management development services.
Objectives of MCI
2.9 The current strategic objectives of the MCr are set out in their Business Plan for
1996/98. In summary, these are to:
• work in alliance with intermediary organisations concerned with management
and management development
3 Previous to the MC! the development and implementation of management standards was taking place in an
unfocused manner, and often by a broad and relatively unconnected set of actors in and out of the public sector.A Revi ew of Mer and t h e ManagementD evel op ment P rogramme· 7
• foster relationships at both national and local level to improve the quality and
relevance of CBMD
• ensure the different needs of Small and Medium-sized Enterprises (SMEs) are
understood by those involved in promoting and delivering management
development
• provide support infrastructure to identified training providers
• raise awareness of the importance of management development to business
performance, and
• ensure that management and managerial performance are perceived to be
central to the objectives of the Government's Competitiveness Programme.
2.10 The MCI Business Plan also sets out the key areas of risk and important dependencies
associated with delivering CBMD to firms and organisations in the market place. A
range of critical success factors are identified by MCI as being important to the
success of its programme. Those relevant to the wider Competitiveness Programme
are:
• the need to expand on the successes of the first year 1995/96 of the
Competitiveness Programme through provision of good practice exemplars
and additional materials where necessary
• the need to integrate Business School activities into the remit of MC I
• promotion of a generally wider understanding of the key role of CBMD in
delivering business benefits, and
• developing and building on strategic alliances made by the MCI in its first
year of operations.
2.1 1 In addition to this the Business Plan sets out the management processes t o b e used by
MCI, a timetable for its work programme and detailed milestones and outputs for each
of its planned programme s (Task and Target Profiles).
2.12 The MCI have set themselves six Key Performance Indicators (KPIs) with which to
assess the effectiveness of their operations. These relate well to the strategic
objectives and cover the necessary ground for MCI to evaluate internally the successA R evi ew of MCI and th e ManagementD evel op ment P rogramme· 8
4
or otherwise of their various activities (Figure 2.1). However, they are not sufficient
to evaluate the impact of the MC! more widely.
.
F,gureZ;1 . ..
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KeyPerf�rm��ce Indicat�r$()VIq Business plan) .
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Assessment of: Indicators used:
Provision of MD Number ofTECs, Business Links, 110s and training providers using
andlor advocating the use of CBMD
Understanding of CBMD Intermediary organisations perception of the relevance and use
Use of MC! based MD materials The range of organisations using materials developed by MCr
Dissemination of good practice via The perception of the success of exemplar projects in encouraging the
exemplar case studies take-up of CB MD (with a specific focus on theSME sector)
Change in Business Performance Improved business performance
due 10 MD
Adoption ojCBMD among Number of BusinessSchools providing local access to CBMD
Business Schools programmes (with a specific focus on the needs ofSME managers)
M AN AG E MENT S T AND A RDS AND THE MCI
2.13 The MC! recently published its new set of management standards which are now
available as NVQs/SVQs at Levels 3 to 5. Qualifications based on these areas are
competence-based, i.e. they use items of work as evidence of a manager's ability to
perform to a certain standard of competence - beginning with NVQ Level 3
(supervisory) through Level 4 Gunior management) and 5 (middle management). The
new standards describe management best practice and are all embracing. They
represent the full 'toolkit' of management competence on which a manager, in any
sector and at any level, can draw.
2.14 The Management Standards comprise around sixty individual units with each unit
relating to a specific management competency. The units are grouped within the
following seven key categories:
• Managing Activities • Managing Information
• Managing Resources • Managing Energy
• Managing People • Managing Quality
• Managing Projects
4 It is important to note that 'success' should not be considered a binary indicator - either successful or not. Due
to the nature of much MD activity, there will be a spectrum of impact from highly successful to activities that
do not appear to have any impact at all. The difficulty in identifYing and measuring the impact of management
development stems from the disparate causal link between management development inputs and quantifiable
business outputs (i.e. reduced costs, increased revenues). This key issue has remained consistently unresolved
by previous research on the topic despite various methodologies put forward to 'measure' the impact of MD.A Review of MC! and t he ManagementDevel op ment Programme· 9
2.15 In addition to their use in accrediting qualifications, the management standards are
used by many firms for the benchrnarking of their own management processes against
a national measure of good management practice. Furthermore, the standards
framework has been used by many firms as a basis for the development of in-house
management training needs assessments and training materials. Finally, the standards
can, and have been, used as a tool in developing or re-designing business processes
across the full range of activities and functions found within firms.
THE PROMOTION OF MANAGEMENT DEVELOPMENT BY THE MCI
2.16 In delivering and promoting the management standards, the MCI has appointed
Management Development Advisers (MDAs) on a regional basis for Great Britain.
MDAs have worked closely with those delivering the standards to firms - this
involves the TECsILECs, Business Links, Business Schools, ITOINTOs and various
other training providers.
2.17 The MCI has also been active in a wider sense in promoting the concept and
importance of management development to various sectors and business types -
importantly to Small and Medium-sized Enterprises (SMEs). In its wider operations
linked with promotion of MD, the MCI has drawn on links with various other
intermediary organisations. This model allows the MCI to have a greater impact, and
thus increase the level of visibility of CBMD among UK firms than would otherwise
be the case.A R
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3. IMPACT OF MCI ON INTERMEDIARY ORGANISATIONS
3.1 Two sets of documents have been used to provide an assessment of the issues relevant
to MD intermediaries:
• Mcr - TEC Satisfaction Surveys
• Business School Surveys.
3.2 MCr-TEC Satisfaction Surveys are available for 1996 and 1997. Commissioned by
the MCr, these surveys have specifically focused on TECs although the MCr has been
working with other intermediary groups in promoting MD to organisations in the
private and public sectors. Half of the 74 English TECs were involved in the survey
process for the 1996 and 1997 surveys.
3.3 The questionnaires used to produce the two TEC Satisfaction reports vary. This
provides some degree of difficulty in tracking and judging the effect of Mcr activities
over time. However, there is sufficient commonality between the two studies to
comment on key findings across the studies in general.
3.4 During 1995, the Employment Department also commissioned research on the extent
5
and nature of Business School activities related to CBMD In addition to survey
based fieldwork, the 1995 report provided 6 case studies of Business School activities
in the MD field. The survey element of this work has since been repeated annually.
The two documents can therefore be used to provide a preliminary picture of MD
activity within the Business School community.
AW A RENESS AND UNDERS T ANDING OF MCI
3.5 There appears to be a high degree of awareness among TEC staff of MCr. This is to
be expected, given the important nature of the TECs as a intermediaries in the
promotion of MD. Also, awareness of MCr appears to be higher at the level of Chief
Executive! Director within the TECs. However, this observation is drawn from a
relatively small number of contacts within the 1996 study.
5 Mainly the provision ofNVQs/SVQs or counterpart academic qualifications that can be adequately mapped
onto the NVQ structure�A
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3.6 There is, however, a lower (but growing) level of awareness of the exact role of
MCI. In 1996, just over a third (37%) of respondents in TECs thought that the main
role of MCI was to provide strategic advice on MD, with the development of
management standards falling closely behind (31% of respondents). By 1997, the
perception of MCI had clearly changed. Over half (57%) of respondents in the 1997
study indicated that the main role of MCI was provision of strategic advice.
3.7 The largest responses to what MCI is, and what it does, relate to specific
products only not to its strategic role. Competence based management standards
and the provision of information materials figure particularly high in this respect.
This result is disappointing given that those surveyed were the main contact point
between MCI and the respective TEC. One would therefore have expected the
strategic role of MCI to have figured much more highly.
3.8 Awareness of the MCI Competitiveness Programme, although high in an absolute
sense (76% of respondents in the 1997 satisfaction survey), is lower than one would
expect among TEC staff. The low level of awareness is further reduced when
considering knowledge of specific materials and assistance available to TECs as part
of the Programme.
3.9 Further questions in the satisfaction surveys have found that although TEC staff might
be unaware of the Progr amme itself, they had, in fact, seen and made use of the free
material. This was the case in all but two TECs.
3.10 Awareness of MCI was addressed in the 1996 Business School survey, where
questions were asked on the proportion of business school staff that were familiar
6
with the MCI standards in all their gUises . A high degree of awareness was
displayed, with some 85% of all respondents having first hand experience with the
original 1991 MCI management standards. A slightly lower proportion were also
familiar with the draft revised standards. In slight contradiction, however, is the fact
that estimates of the number of staff familiar with MCI published standards were
somewhat lower.
6 i.e. the 1991 Standards, Senior Standards 1995, Energy Management Standards published in 1995 and Quality
and Project Management Standards.ev_ w__
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3.11 It is clear from both business school surveys that experience and knowledge of MCI,
its aims and products is much more developed in the new universities and other higher
education colleges than in the older university sector. This is partly due to the more
vocational nature of courses delivered in the newer universities, but also the attitudes
of staff towards the usefulness of the management standards. Reservations among
staff in the older institutions appear to be focused on a lack of awareness of the
sectoral and skills coverage provided by the standards.
3.12 What remains unclear is how the adoption of MCI-type standards, as part of many
new or re-developed management courses, will affect the sector more generally - and
critically how these newer courses will cascade the profile of MD into firms in future.
USE OF MANAG E MENT D EVELO PMENT
3.13 There appears to be a mixed response to formal support for management
development among the TECs. Inclusion of MD as a specific objective within the
TEC business plan is reported for a large number of TECs (94% in 1996). This
support appeared to have declined by 1997 to 59% of TECs. It appears to be the case
that the decline in formal support is linked to the difficulties that TECs have with
supporting activities that have no clear revenue stream attached to them.
3.14 When considering only MCI management standards, there is a much stronger - and
developing - level of support among TECs. 83% of TEC in the 1997 satisfaction
survey thought that standards would be useful to businesses in their area, and that the
TEC was planning to use, or already using, the new standards as developed by MC!.
There was only one definite negative response when questioned on the TEC plans for
use of the standards. Clearly, the profile of the standards has been assisted by the
marketing efforts of MCI throughout late 1996 and early 1997, which have therefore
been largely successful.
3.15 One of the key criticisms to come out of the 1996 satisfaction survey was that MCI
products were often too expensive for the TEC to adopt. Just under half (48%) of
the TECs surveyed thought this to be the case. The reason for the feeling of over
priced resources fell to specific products and was not a perception that all products
were too expensive.�A
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3.16 Specific products that were mentioned by a large proportion of TECs as being of
high quality were the MCr Pocket Directory (85%), Good Managers Guide (81%)
and the Management Standards Directory (62%). Nevertheless, it is important to note
that both the Standards Directory and the MCr Pocketbook also featured significantly
in the products thought to be relatively expensive. TECs therefore appear to view the
use of these resources with firms in their area as being limited by their cost.
3.17 The trend between the 1996 and 1997 studies shows that whilst MD remams
unsupported by many TECs, a move towards increasing the role of MD within overall
training delivered to firms is beginning to emerge. However, TEC promotion of MD
still largely exists in the shadow of other - funded - elements of training provision.
3.18 The Business School surveys provide an indication of the level of take-up ofNVQs in
7
management. By September 1994 , close to 8,000 people had been awarded
certification, with a further 25,900 (rounded) registered on courses, increasing to
115,300 (65,720 full time equivalents) in 1996. It is not clear from the two reports
how indicative this situation is of the national picture ofNVQs in management. Nor
is the basis of the initial 25,900 student registrations known (i.e. whether these are
absolute numbers or full time equivalents).
3.19 In terms of the use of MCI products, the 1995 report focuses on MCr management
standards specifically. The relative concentration of use of MCI standards as part of
Diploma and Certificate qualifications, as opposed to degree courses or MBA
programmes, is clear from the survey analysis. This was felt to be due to the design
of the latter type of courses, remaining firmly based around course work and
examination and not work-based experience/assignments.
3.20 The survey also found that "new universities" and "other colleges" were much
more likely to be using MCI standards than the old university sector. Around
62% of all Diplomas and Certificates offered by new universities and other colleges
used MCr standards, whereas the figure for old universities was 35%.
3.21 A note of caution needs to be placed on these comparisons however. In 1995 the
number of old universities offering NVQ qualifications in management was low in
absolute number (only 2 programmes against 30 in the new university sector for
example), and therefore the results as presented are not statistically robust.
7 Both Business School reports cover Scotland and therefore report for number of NVQs plus Scottish
Vocational Qualifications (SVQs)._A _ w
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CI_ _
3.22 Apart from their use as the basis of NVQ qualifications, Mcr standards were being
used more widely in the business school community. Again, this broad use of the
standards appears to have been focused on the Certificate and Diploma courses
offered by institutions. Examples of broader use include informing the design of new
courses, both as the focal basis of a new course and when mapping existing
qualifications for equivalence withNVQs.
3.23 A key finding of the 1995 business school report in respect of the MCr was that many
institutions found difficulties in using MCI standards when mapping equivalence
between existing courses and NVQs. Many reasons were given for this, but 70% of
respondents mentioned a lack of awareness among prospective students and their
employers of the MCr standards. 45% also stated that lack of their own staffs
awareness of Mcr standards also posed a major problem in the mapping exercise.
Just under three quarters (73%) of respondents felt that the perceived credibility of the
MCr standards was low and that this too created problems in mapping qualifications.
S A TISF A C TION WI TH MCI
3.24 The proportion of TECs within the satisfaction surveys responding that MCr had
displayed a clear strategic direction has declined, from 67% in 1996 to 47% in 1997.
This highlights, and underlines, the apparent difficulties that some TECs have had
in understanding the main role of MC!. Furthermore, there is an apparent
divergence between the lower level of satisfaction with the MCr "as an organisation"
and the much higher degree of satisfaction with "specific products" and the MCr
regional representatives (see below).
3.25 rn general, however, the total number of TECs reporting poor performance by MCr is
low. Only 11% of the sample in 1997 (i.e. 8 TECs) felt that the performance of Mcr
had in general been poor, with a similar number recording "excellent".
S A TISF A C TION WI TH MCI M AN AG E MENT D EV ELOP MENT ADV ISO R S
3.26 The level of satisfaction with the support provided by individual MCr Regional
Management Development Advisors (MDAs) has been investigated through questions
on the frequency and quality of contact with MDAs as part of the satisfaction survey..:::
A:..: R i .:::ew.:::o.::.f.::.
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3.27 From the results of the surveys undertaken so far, there appears to be a high degree of
satisfaction with, and support for, MCI advisors. Whilst 92% of all TEes sampled
in 1996 (52 in total) stated that they were happy with the frequency of contact with
their respective advisor, only 66% of TEes sampled in 1997 felt the MDA to be very
accessible. During 1997, almost one third of TEes had contact with the advisor at
least once a month.
3.28 The results of the 1996 study highlighted that 69% of TECs felt there to be nothing
further that MDAs could offer, and 85% of TEes were content with the quality of
service offered by the advisor. In 1997, the quality of the relationship with the
advisor was ranked from excellent (=1) to poor (=4) with an average score of 1.88
across all English regions. The highest scores were recorded by West Midlands and
Eastern region (both scoring 1.3), with a general correlation between perceived quality
of relationship and accessibility.
3.29 Importantly, the perception of most TEes is that advisors are there to assist the TEe
in their work with employers, and not that TEes should be helping MDAs. This is a
significant finding given the general reticence, and practical difficulties, of TEes to
take on non-revenue funded responsibilities.
3.30 A number of problems arise in interpreting TEe satisfaction with the MeI from the
results of these surveys. First, coverage of the surveys is not comprehensive. Indeed,
in 1997, no response was recorded from 23 TEes (representing 31 % of all TEes in
England). For this reason the views expressed cannot be taken to imply that all TEes
are satisfied, and no indication is available of the reasons for non-satisfaction of those
not taking part in the research.
3.31 Secondly, and perhaps more importantly, TEe staff involved in the survey process
were largely the main point of regular contact with the MDA. The line of questioning
used does not therefore allow a general picture to be obtained of the satisfaction
apparent within the TEe as a whole. If contact between MeI and the TEe is not
secured on a broader level, then the benefits of the strategic role of the MeI to TEe
staff and those who they advise are likely to be lost.�A�
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THE I MP A C TOF THE MCI ON MD PROV IS ION
3.32 The TEC satisfaction surveys appear to suggest that the MCI has not yet been
able to significantly shift TEC strategies with respect to MD. Very few TECs
have formally adopted MD within their strategic business plans for instance. Where
MD is becoming included in TEC activities it is often as a part of a wider
development - with increasing the numbers of firms working towards liP accreditation
being seen as the more important goal for TECs, rather than the number of MD
courses or training products being "sold" into the marketplace.
3.33 Nonetheless, MD is increasing its profile in the TEC sector. A small number of TECs
have now recognised MD as an intemal part of the process they are involved with in
firms in their area. Others have included MD training products within the core
portfolio of what they offer to local businesses. There is now a great deal of evidence
that the majority of TECs will be introducing MD more formally to their clients in the
near future. Close monitoring of activities over the next 1 2 months will assist in
validating the claims of many TECs as part of the TEC satisfaction survey of 1997
that they will be introducing MD as part of their strategic positioning.A_ R_
_ t_D · _ _______________ 19
__
4. THE IMP ACT OF MCI ON EMPLOYERS
4.1 Three sets of documents are available with which to evaluate the impact of the MCI's
activities on employers:
• MC! - TEC Tracking Studies
• Segal Quince Wicksteed - "Management Training for Growth SMEs"
• Open University - "Portrait of MD H.
4.2 A series of Tracking Studies have been undertaken throughout the operation of the
MCI (1995 - 1997). These are based on an annual sample of around 1,000 firms
drawn up to reflect the sectoral and size band characteristics of the British economy.
The studies have built on previous management training and development surveys of
private sector organisations nationalll.
4.3 The 1995 study was however, tied closely to an assessment of the views and use of
9
the Investors in People progranune as well as the products developed by MCr. The
level of investigation of the role and impact of MCI that the 1995 study provides is,
therefore, somewhat lower than in subsequent years. Both the 1996 and 1997 studies
are much more focused on the work of MCI and, as a consequence, contain more
relevant data for the current analysis.
4.4 During 1995, the Department of Trade and Industry commissioned evaluative research
by Segal Quince Wicksteed Ltd of MD activities in 49 SMEs. The focus of the
research was to investigate the links between SME investment in MD and subsequent
business growth.
4.5 Finally, the Open University have recently published 'A Portrait of Management
Development'. This provides the most comprehensive snap-shot available of the
current state of MD in the UK. The research was based on a survey of managers
drawn from over 600 firms. Panels were used to differentiate companies by size with
medium and large-sized firms (defined as employing more than 100 staff) in one
panel and SMEs in a second panel. Of the firms in the SME panel more than 60%
actually employed fewer than 20 staff.
8 The 1996 and 1997 surveys also encompassed public sector activities.
9 Due to being part funded by liP UK.��A R�ev_i e �g�e _
4.6 Whilst the research framework was largely qualitative, the use of a quantitative survey
instrument allowed for the analysis of potential causal links between MD activity and
resultant business impacts in more detail than had been undertaken by any previous
study. In addition, the survey instrument used with the SME panel was tailored to
reflect the different issues smaller firms were known to face in using MD.
AW A RENESS OF M AN AGEM ENT DEVELOPM ENT OPPO RT UNIT IES
ANDTHEMCI
4.7 Awareness of MCI. Overall, just two fifths of firms were aware of MCI (39% of the
tracking study sample in 1997). Of these firms, views varied as to what exactly was
MCI's role. The largest response was the "setting of competence based management
standards and provision of training products". However, over a third of these did not
appreciate MCr's wider role. One possible, and plausible, reason for this is the front
line role of intermediaries in marketing MD rather than MCI itself.
4.8 Information/Awareness of MD . The key information source used by firms for
information on MD are published articles in management and trade journals. These
were used by over a third (37%) of firms in the 1997 tracking study. These provide
firms with an indication of what is working for others, both in their sector and/or size
of business and also more generally. The popularity of such material is believed to
derive directly from an increase in general awareness of MD and could therefore be
attributed, at least in part, to the success of the various institutions involved -
including MCr.
4.9 Intermediary organisations using and marketing the products developed by national
bodies are the second most popular channel through which information on MD is
accessed. Local TECs were quoted as the primary source by 35% of respondents in
1995 for example, and this has remained relatively constant during 1996 and 1997. In
short, TECs are the key intermediary information providers on MD.
4.10 Information on MD is not, generally, accessed directly through either the MCI, or any
other national bodies. A relatively small proportion of firms use the MCI as their
primary source of information on management development. Over the period 1995 to
1997, between 5% and 10% of firms in the tracking studies had used the MCI for
information purposes. The trend has been for a small upwards rise. As a
comparator, this use of MCI for information on MD is similar to the proportion of
firms using the Institute of Management.�A�
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4.11 Thus, whilst gains have been made by MCI in providing information on MD
activities, it is seen by firms as very much a secondary source compared to TECs
when seeking to understand better what MD is and how it can be progressed within
their own organisations.
4.12 From the evidence presented by the tracking studies, it would appear that there is
somewhat of a variation by size of firms in the perception of Mc!' s role in MD.
Whereas small firms tend to relate to, and use, TECs when using MD, showing
little knowledge of the MCI, larger firms (and public sector organisations) both
understand and make more use of the MCI directly.
T A KE -UPOF M AN AGE ME NT DEVELO PMENT ACT IV IT Y
4.13 Surveys undertaken during the first half of the 1990's reported relatively high rates of
take-up of MD. In 1992, 51% of respondents were actively using MD, but this level
has never been repeated. It is important to note that the sample structure and
definitions of MD used have varied between the earlier and later tracking studies.
This may account for some of the changes identified by the studies.
4.14 By 1997 the level of MD activity reported by the tracking studies had fallen to
lo
45% (450 firms) Whilst the private sector reported the largest use of formal MD
during 1997, the trend in firms' MD activities suggests a general decline in use since
the 1995 tracking study. However, over the same period the public sector has
exhibited a growth in the use of MD. This has served to partly offset the trend in
the private sector.
4.15 In contrast to the tracking studies, the OU study found within the same firm a
significant increase in the level of MD being undertaken when compared to ten years
ago and also a broadening of use of MD. This is reported for all sizes of firm and
across all sectors. Moreover, when asked about future levels of MD, significant
numbers of respondents believed that increases would be very likely.
4.16 According to the OU work, the average number of days taken up by MD activity per
manager varies between 4.6 days (small firms) and 6.4 days (firms with 1000 plus
employees). Although this appears to be of the same broad magnitude, the level of
time commitment in the largest firms is some 50% greater than in small firms. In all
cases, public sector bodies tend to undertake slightly more MD training per manager
than their private sector counterparts.
10
We do not believe that the fall is necessarily statistically significant._A _ R_e __
4.17 The contrasting picture presented by the OU study is, in part, due to the wider aud
more general definition of mauagement development adopted. The studies
commissioned by MCr focus on the use of specific products - often only those with
which the MCr is involved - aud report a declining trend in the use of some of these.
4.18 There also appears to be evidence of a substautial amount of (often more subtle) in
house mauagement training being undertaken in UK firms. As such, this may not be
uncovered by questions on formal methods - such as those within the tracking studies.
Thus, the absolute level of MD activity is often likely to be higher thau reported.
4.19 It is also notable that the OU study reports the take-up of MD by mauufacturing aud
service sector firms to be roughly equal. This contrasts with other studies that suggest
a bias towards greater use in service sector orgauisations.
FO RM OF M AN AGEM ENT DEVELOPM ENT USED
4.20 MD undertaken by firms cau take a multitude of forms. A reasonable way of
classifying the use of MD is by considering formal aud informal methods separately.
Activities undertaken formally are set out aud planned for within a compauy's
business planning process or au individual's training programme. Those activities
which take place informally or in au ad hoc manner - such as the learning of new
methods from conversations aud shared learning experiences with other mauagement
staff (inside aud outside of the firm) - are distinctly different from the formal
ll
methods .
4.21 According to the 1997 tracking study, individual training aud development plaus are
used by three quarters of the 45% of firms reporting use of formal MD methods (i.e.
340 firms). All other formal methods of MD identified have declined in popularity
since 1995, with the use of MD in the induction process suffering the most significaut
decline. This might reflect the increasing use of internalised, tailored, MD tools by
firms, often regarded by mauagers as part of a wider organisational process rather thau
a formal mechauism in their own rightl2.
II Although often informal learning takes place whilst managers are undertaking formal MD activity - short
courses, conferences, etc.
12
MD tools used as part of an annual salary and promotion review, or as part of a self-assessment process for
example. Many of these would, in fact, be accounted for in the three quarters affirms using MD as part of
individual training programmes.�A�
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4.22 The use of management standards remains a central focus of many firms MD
activities. From the 1995 and 1996 tracking studies, the MCI was the single most
important contributor of information for those firms using management standards 13
Three quarters of firms had used material sourced from MCI during 1996. However,
this had declined to a third of firms in 1997. The increasing market penetration of
a broad range of organisations account for the fall off in the MCl's popularity -
with the Institute of Management and Business Schools increasing their share of the
MD qualifications market significantly over the time period.
4.23 The tracking studies report that the total number of respondents using, or planning to
use, a management standards framework has increased. In 1996, 82 (8%)
organisations were using a standards framework as part of their approach to MD,
rising almost two-fold to 150 organisations (15% of the sample) in 1997. Although
low in absolute terms, the trend is increasing.
T A KE -UPO F SPE CIFIC MCI PRO DUC TS
4.24 The degree of penetration of specific MCI products was investigated by the tracking
studies. The products that tend to be used most differ between years as the focus of
MCI efforts have changed and new products have been developed. In 1997, the most
recognised and used MCI product was the personal competence model. Half of firms
had used or referred to this, with a similar proportion making use of the Management
Standards Directory and the Good Managers Guide. Only those products released for
the first time in 1997 displayed a relatively low rate of and penetration in the
marketplace.
4.25 The reason for the growth in MD was also investigated. From this avenue of inquiry
it appears that the most popular reason for the use of MD was the parallel adoption
of the Investors in People process within firms. This would also agree with the
correlation between firms who are more active in HRD terms and the take-up and
scale of MD activity.
4.26 The causal link between liP and MD activity has not been tested - i.e. whether firms
first become involved in liP and subsequently use MD or whether exposure to MD
opens the firm up to the liP process and indeed, other HRD initiatives/programmes.
Given the current focus of many TECs on promoting IiP to firms, and the lack of TEC
funding streams for MD, it is highly likely that causation runs from IiP to MD.
13 This information is only available within the 1996 and 1997 studies._A _ R__
ev_ w__
of_ M
__
OBS T A CLE S TO T A KE -UP OF M AN AGE MENT DE VE LOP MENT
4.27 Reasons for the apparent decline in use of MD were examined by the MCI tracking
studies. In the 1995/6 studies, the main reasons given for not using formal MD
methods was that management training was either "not needed" or was "not practical
to implement". By 1997 the most popular reason provided was that "staff already had
sufficient training".
4.28 What is clear from the work of the tracking studies is that the cost and/or time
involved in implementing MD is not seen as a major obstacle by many of those not
choosing to participate. In 1995, only 16% of those without a formal MD programme
stated that time/cost constraints were stopping them from undertaking such a
programme. This has remained fairly constant in subsequent studies.
4.29 A number of variables were tested within the SQW work for their degree of fit with
decisions to undertake MD activity - thus enabling assessment of potential obstacles
to adoption of MD in SMEs. Of these, the most relevant were found to be internal
influences such as the attitude of the firm to human resource development issues.
Those firms with a formalised internal MD strategy were among the highest
users of MD .�A�R�
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__________________
25
5. IMPACT OF MANAGEMENT DEVELOPMENT ON EMPLOYERS
BUS INESS BENEFIT S
5.1 The perceived benefits of using MD were investigated by the tracking studies. In all
cases the most commonly cited benefit was that MD can assist in increasing
efficiency and productivity. Over half (52%) of all firms questioned believed this to
14
be the case in 1995 However, the causal mechanism between MD and bottom line
business profits is less readily understood or believed by firms. Indeed, the three
tracking studies are consistent in finding a relatively small proportion of firms
responding that MD could lead to increased profits (18% and 19% in 1995 and 1996
respectively, falling to 8% in 1997).
5.2 Whilst not providing quantitative results on the impacts of MD in SMEs, the results of
the SQW work (covering 39 firms) are useful in assessing where impacts might be
expected to occur, and how firms might be able to maximise the benefits available
from MD. The key results of the SQW work were that:
• no single factor can explain the different impacts created in, and. the relative
experiences of, firms in the sample
• SMEs in the upper size band (i.e. 50 to 100 employees) appear to be able to
capture the benefits of MD more readily;
• whether this finding reflects actual experience, or whether it is due to the
firm's ability to observe and measure changes in business activity is unclear
• firms displaying average rates of growth appear less able to benefit from MD
than those on low/no growth or very high growth trajectories (i.e. this may
also support the view that these "satisficing firms" have less interest in MD)
• MD activity focused on training employees from similar working
environments (type of firm or job type) appears more successful than delivery
to an audience drawn from a range of firms or types of job
• firms that exhibited the highest levels of impact appeared to be those which
embraced the need for change in response to fluctuations in their business
environment
14 Although still the most prominent identified benefit, the proportion of filmS highlighting improvements of
this type feU to 35% of the sample in 1997.A_ R_
_
• those finns with relatively more integrated human resource development
strategies appeared to benefit from the highest level of impact of MD.
5.3 A limited number of observations can be made with relevance to the MCI
Competitiveness Programme. The SQW research found that one (of three) of the
characteristics of finns which experienced little beneficial impact from MD was
information failure. SMEs often have little or no infonnation on the benefits of MD
or the products and services available in the marketplace, and are often therefore
unable to access the right type of development and training products for their
particular businesses.
5.4 The Mcr is only one of many organisations that could affect this situation. However,
increasing flows of infonnation to SMEs is of utmost importance. The real problem is
that providing useful infonnation to SMEs is notoriously difficult. It is not enough to
rely on increasing the general flow of infonnation into the market - indeed this may
make matters worse through an "infonnation overwhelming" effect. Narrowly
focused sector or issue-specific campaigns are more likely to attract SMEs in higher
numbers than relying on the release of generalised infonnation.
5.5 When addressing MD in the SME community, it is clear that the context within which
finns operate is important. The context of the firm and the market it works within has
a significant bearing on the ultimate scale of take-up of, and the impacts resulting
from, training. The SQW report concludes that success in the use of MD in SMEs can
only be ensured if the form of training is flexible enough to the needs of the
organisation, undertaken in a wider culture of human resource development and is
delivered to finns that embrace the need for change.
5.6 The OU study of 600 finns explored the generalised perceptions of the impact of
formal and informal MD activity, by asking firms to indicate on a scale of I 10 -
where the finn stood following a MD programme. The results therefore need to be
considered carefully in light of their inevitable sUbjectivity . Only one respondent
from each finn was asked to provide the indication of impact, and very few
companies had a formalised MD impact monitoring process for these individuals to
l5
draw upon
5.7 Smaller firms, those with fewer than 100 employees, were asked about the degree to
which they thought MD had been successful. In general, two thirds of the firms felt
that MD had been worthwhile. Beyond this, the scale and nature of impacts was not
investigated.
J5 The lack of an adequate system for evaluating the impacts of MD was found even in those firms who were
chosen by the study team for case study material.�
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5.8 The perceived extent of impacts was only investigated with firms employing more
than 100 staff. Overall, few companies perceived there to be low or no impact from
the MD training undertaken. Only 16% of firms felt that the impact had been in the 1
- 4 categories (low impact). In contrast, most firms were positive about the scale of
impact, with half (49%) reporting impacts between 7 and 10 on the 1O-point scale.
Furthermore, this high degree of perceived impact was found to exist across firms of
all sizes.
5.9 A range of potential explanatory factors for high impact MD activities were tested by
the OU study through regression analysis. This suggested that internal factors are
much more significantly correlated with beneficial impacts from MD than
external factors. Among these internal factors, the most significant (ranked by order)
were:
• a high priority placed on MD by the firm
• the quantity of formal training undertaken
• positive commitments within the firm of the organisations responsibility for
individual managers development.
5.10 The conclusion is that MD is successful where it occurs in a 'sympathetic'
environment - particularly within a firm with a well defined commitment to human
resource development in general.�A�R� o f_M__
ev_ w__ C_ D_
6. KEY FINDING S AND CONCLUSIONS
KE Y FINDINGS
Evaluation Quality and Coverage
6.1 The studies reviewed have raised a range of issues in the design, promotion and
delivery of MD. However, the coverage, consistency and, more importantly, the
quality of the evaluation work reviewed so far has differed significantly.
6.2 On the one hand, the SQW and OU studies have assessed the current position of MD
activities in the UK by focusing on specific types of firm. The OU study covered in
excess of 600 firms of different size and sector. The analysis undertaken by size of
firm differs between the panels chosen for study in light of the different issues faced
in general by small and large firms. In a similar manner, the SQW research has
focused exclusively on SMEs, although these were further broken down into two size
bands for analysis.
6.3 The tracking studies, although covering 1,000 firms in each year, present problems in
interpretation of their findings due to changes to the underlying survey instruments
used. The very different conclusions on the take-up of MD in the tracking studies
compared to the OU work reflect these changes and different definitions of MD.
6.4 The studies of TEC and Business School experience with MD have delivered more
specific findings, with a subsequently limited degree of general evidence being
available with which to compare other studies' findings.
MCI and Intermediary Organisations
6.5 MCI has made a favourable impression with TEC and Business Link MD co
ordinators in terms of both quality of materials and advice and level of service from
the regional advisors.
6.6 However, amongst TEC staff in general (rather than MD co-ordinators), awareness of
the MC! is lower. Moreover, there is a risk of over-dependence on one individual
within the TEC or Business Link to disseminate the MCI's work. Staff movements
can potentially lead to a significant and rapid reduction in the overall level of
awareness of the MCI within the intermediary organisation.You can also read
