We could probably all think of instances where organisations we’ve read about, heard about or even worked for have undergone a period of rationalisation to increase efficiency, yet they have appeared to all intents and purposes to be targeting entirely the wrong areas. Some of the most vital jobs are cut whilst others which are less crucial are retained; the budget is slashed in a vital area which just cannot afford another cut; a service has been cut which was vital to customers and therefore to the future success of the organisation. Though rationalisation is sometimes a necessary part in the life of any organisation, it is obviously something that needs to be done with extreme caution and with all the long-term repercussions factored into the decision making process.
The announcement by the Department of Business, Innovation and Skills last year of a series of area reviews into the Further Education sector was basically the announcement of a process of sector rationalisation, the idea being that institutions deemed to be functioning ineffectively would either be closed or told they must merge with other institutions. Now the Government has signalled the next phase of this process, by offering consultancy grants of up to £100,000 to support “significant changes resulting from an area review.” In other words, the grants are basically intended to help individual colleges, as well as those that are set to merge, rationalise their operation as part of the wider process of rationalisation throughout the sector.
The BIS memo – Transition grants guidance: area reviews of post-16 education and training institutions – states that grants may be given in cases where “significant rationalisation” or other “significant change” is reasonably expected to have significant upfront costs. It went on to name some specific areas where this might be the case:
- Significant curriculum rationalisation
- Establishment of a shared services arrangement
- The establishment of a joint venture such as a merger
Although curriculum rationalisation is stated separately from the other issues, in reality it is highly likely to play a vital part of joint ventures, especially mergers, and is therefore set to one of the major reasons for colleges to apply for the grants. However, as mentioned above, it can be very easy for organisations to rationalise in the wrong places, and so colleges will need to take great care how they approach this rationalisation process. For instance, a college or merging colleges might be expected to make efficiencies, and so they might decide to cut provision in a particular subject area on the basis of cost. However, this could mean that they end up cutting an area that is vital to the local economy, which would be counterproductive to one of the major aims of the area reviews, which was for colleges to show “better responsiveness to local employer needs and economic priorities”.
So what does successful curriculum rationalisation look like? Basically there are three parts to the process:
1. Firstly, every college or merging colleges where significant curriculum rationalisation is recommended must take steps to understand in detail the needs of local employers.
2. Secondly, they should be able to map their curriculum to these needs in order to identify any areas of significant under and oversupply.
3. Only after carrying out stages 1 and 2 can colleges begin to take “rational curriculum rationalisation” decisions – making efficiencies based on the objective realities of how their current curriculum is responding to the need of local employers and economic priorities. This might include cutting areas where there is little local need, as well as those areas where the college is currently oversupplying the local economy. On the other hand, it might also mean increasing provision in areas where the college is currently undersupplying, or even creating new courses in areas which are not currently being met at all.
Just as any commercial organisation going through a rationalisation process can be tempted to make cuts where the most money can be saved, so too many colleges, faced with rationalisation recommendations, may well be tempted simply to slash courses simply to save money. However, the availability of these grants turns out to be a good opportunity for colleges to avoid making short term decisions purely on the basis of costs or on unwarranted assumptions about what is and isn’t vital to the local economy. Instead, it looks like colleges now have a great opportunity to ensure that whatever curriculum rationalisation they do undertake is based on a rigorous understanding of how their curriculum currently matches up with local needs.
Andy Durman is the managing director of Economic Modelling Specialists International UK (EMSI UK), the labour market information firm