Press release

Productivity boost for small businesses

UK Futures Programme will determine how small businesses' productivity levels can be improved by addressing leadership and entrepreneurship skills.

Business people working together

Small businesses across the UK will benefit from stronger leadership and entrepreneurship skills to improve their overall productivity, thanks to 8 innovative projects which received the green light today.

Under the programme, 8 local ‘anchor institutions’ across the UK will work with the government-backed UK Commission for Employment and Skills (UKCES) to pilot new ways to boost the leadership of small businesses.

Small businesses will have a chance to benefit from a range of new management development opportunities, from mentoring programmes to online leadership training, all designed exclusively for them.

The projects are part of the UK Futures Programme, run by UKCES. Each is trialling innovative ways to improve the productivity of small businesses in their local community by boosting their leadership and entrepreneurship skills. In particular the projects will identify new ways to help small businesses who haven’t previously had any leadership or entrepreneurial training.

Each anchor institution has a strong local presence and commitment to their community. The institutions UKCES will be working with include chambers of commerce, universities, colleges, councils, enterprise agencies, learning partnerships and business schools, in conjunction with local employers.

Julie Kenny CBE DL, founder of Pyronix Ltd, a leading small business in the security sector, and Commissioner at UKCES commented:

Small businesses form the backbone of the UK economy. Yet constraints on their time and resources mean they are the least likely to develop the leadership and management skills that will help them grow.

Owner managers and senior leaders of small companies need to spend their time and money wisely, and see clear benefits from the start. Current training programmes are often too broad or vague to be usefully applied in the real world. Simply gaining access to good programmes can also be difficult - for instance if you operate in a more rural area.

We need new ways to reach these businesses, and we need solutions that are relevant to each small firm. The anchor institutions we will be working with have demonstrated a strong understanding of the specific issues that small businesses face in their local community. They have also shown that they have the ability to reach out to businesses who often find themselves excluded from national programmes.

The 8 selected programmes are:

  • Micro Firm Leader Development Programme, led by the Causeway Enterprise Agency, Northern Ireland

Nearly 90% of firms in Northern Ireland have fewer than 10 employees. However, currently, leadership training is more suited to SMEs with a management structure than these micro businesses. Accessibility is also a problem for these firms, with programmes predominantly being run in Belfast.

The Causeway Enterprise Agency will run a Micro Firm Leadership programme to reach out to these very small businesses. Based on an existing Harvard Business School leadership programme, this project will test if the concept of ‘purpose driven leadership’, which is often used by large corporate firms, can also be relevant to micro firms.

  • The Catalyst Project, led by Inverness College UHI

In this highly dispersed region, take up of leadership training is low, as is entrepreneurial aspiration. Poor transport on the periphery and island communities impacts on access to training.

The Catalyst project will develop a new training programme that involve experienced entrepreneurs mentoring and inspiring other small businesses. It will also develop and test the value of online peer networks and online learning programmes alongside face to face delivery of training.

  • Support Programme co-created by Regional SMEs in Entrepreneurship and Leadership Skills, led by the Regional Learning Partnership – South West & Central Wales

Current mechanisms to engage with small firms in this area are viewed as ineffective, as take up is low. The geography of the area also makes leadership support difficult to access.

This project will create a regional model that will engage and signpost small businesses to a variety of support services to meet a diverse set of training needs. It will form a pilot group of small employers to co-create and test new ways of reaching small businesses. Existing support will be mapped out and tested to challenge its relevance and appropriateness for small businesses.

  • CAPTURED, led by Newcastle University

Small firms tend to underinvest in training and if they do invest it is more likely to be related to financial or technical areas than in leadership and management training. This is a significant missed opportunity for the North East economy because investment in leadership and management skills tends to have a particularly strong impact on performance for firms with between five and 19 employees.

This project will engage large regional employers who will release a number of their senior managers to support small firms through an innovative short programme designed to provide the small firms with leadership skills that they can implement in their business immediately.

  • LEAP (Leadership & Entrepreneurship Advancing Productivity), led by the University of Sunderland

The University offers unique access to the first ‘Fab Lab’ in the region – one of an international network of innovation centres which provides open workshop access and lab space, access to specialist equipment and support for the commercialisation of new products and services. There is significant pent up demand from small firms for the use of this type of resource with 76% of businesses saying they’d like to use facilities, equipment and expertise available, yet actual engagement is low.

This project will offer small firms drawn from the two main sectors in this region – manufacturing and creative skills – the chance to work together to share learning and expertise. The project will test different approaches to leadership training at the Fab Lab for example, evening and weekend access, mentoring and peer networking and self-directed study online. If successful, those involved are expected to increase their turnover by 10% within 2 years.

  • The Leadership Forge, led by Teesside University

There are a large number of SMEs in this area yet a high proportion are not growing. This is partly due to the fact that owner managers of small firms in this area do not currently see leadership development as a valid route to business growth.

This project will challenge the low value attributed to leadership development by local small businesses. It will develop a community of experiential and shared learning via workshops, coaching, site visits to large employers and peer learning sessions.

  • Doncaster Leadership & Entrepreneurship Academy, led by Doncaster Council

The Doncaster economy has suffered from a decline in traditional industries and lags behind regional and national performance indicators. The area has low business start-up rates and low levels of growth amongst existing businesses.

This project hopes to unlock talent growth within small firms via a 12 month Leadership & Entrepreneurship programme derived from European best practice and expert local knowledge. The programme will take an action learning approach, with small group workshops, exploring real world problems; peer to peer networks; ‘behind the scenes’ company visits and one to one ‘surgeries’ with local professional service providers.

  • The Leadership Project, led by St Helens Chamber Ltd

Small firms in the region feel that they do not have the time to spend away from their business, to invest in their own skills and knowledge of management and leadership. As such take up of existing support in these areas is low. Medium-sized firms however have been shown to be more likely to take up opportunities to develop their leadership skills than small firms are.

This project will give small firms the opportunity to be mentored by medium sized firms in their area who have gone through a growth curve themselves and can relate to small firms’ issues. The project is unique in that it will also enable the cohort of small and medium companies to work together on a City Growth project that will contribute to the regeneration and economic growth of St Helens.

Each project represents a joint investment with UKCES, with organisations investing in cash, in-kind, or both, alongside a maximum government contribution of £200,000 per project. The total government contribution is £1.3 million.

For more information email the Futures Programme team or view the original competition brief.

Published 12 October 2015