Rob Elliott, UK products manager at Capita’s further and higher education business

Paradoxically, in a time of belt-tightening and austerity measures, there are many opportunities open to the further education sector in Scotland. As David Bell, professor of economics at the University of Stirling, says: "With fewer jobs on offer, young people who once would have left school and gone straight into work are now looking towards further education. Despite the financial restraints, there is a real opportunity to engage young people here. The government's decision to increase apprenticeships is a step in the right direction to re-emphasize vocational areas that need stimulating, such as manufacturing."

While there is no doubt that FE provision will be instrumental in re-energising the economy, the challenges that come with budget cuts can't be ignored. Over the border in England, the Comprehensive Spending Review of October 2010 set out cuts of 25% for the further education sector but we have yet to fully understand how Scotland will address the terms of the CSR.

A lack of clarity around how the cuts will be implemented might prevail, but we do know that Scotland's overall budget will fall by £1.3 billion in cash terms in 2011-12 so FE is bound to feel an impact. David Bell comments: "All budgets in the education sector are under pressure, so colleges need to rigorously scrutinise for true efficiency savings, ways of cutting cost but not quality, and rationalisation measures."

Planning + Monitoring = Resilience

To start with, colleges need to be confident that their in-house management processes are resilient enough to cope with change, that fundamental back-office administrative processes are streamlined and efficient, that student retention levels are being monitored and that, no matter what the socio-economic vicinity is like, the college is doing everything it can to demonstrate the value it is adding to their students' learning experience.

The key to effective management of these areas lies in proper planning and consistent monitoring – and a careful combination of the two can add up to an extremely cost-effective provision of education. For example, accurate forecasting of the financial implications of providing different courses before the course is offered means that should anything happen once a course is in progress to affect the bottom line, action can quickly be taken to stem the loss of money or college reputation.

Vocational Focus

Colleges looking to maximise their ability to keep on top financial lines in Scotland need the flexibility to adapt to the renewed focus on vocational training. The budget bill for 2011-2012 will deliver 25,000 modern apprenticeships, the highest ever number in Scotland and, as David Bell puts it, "This means colleges must develop strong links with employers; collaboration is key. We may not achieve the success of Germany overnight, who do this as second nature, but we need to have the consistency to see it through."

To operate successfully in this area, colleges need the frameworks in place to seamlessly manage the dual elements of academic study and on-the-job training. It's critical to ensure that any learning taking place outside the classroom is accurately monitored and there are big efficiency savings by doing this electronically rather than producing administrative-heavy paper-based reports.

Successful Outcomes

Facing an uncertain financial outlook is always an uncomfortable position to be in, even for the FE sector which is so well-used to accommodating change. To take back an element of control, colleges must turn their attentions inwards and exploit the capabilities of technology to streamline processes and take advantage of efficiency gains. No-one is suggesting that remaining competitive, regardless of the budgetary outlook and without losing sight of the priorities that remain at the heart of the education sector, is going to be easy. But, as Skills Minister Angela Constance said in a debate in February 2011, Scotland's colleges have a "track record of rising to challenges".

Rob Elliott is products manager at Capita Further and Higher Education, providers of integrated management information systems to the FE and HE sectors

Follow Rob on twitter @capitafhe

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