Leadership Development
How Government Works

Prepared for the Auditor General for Scotland, November 2005

Auditor General for Scotland
The Auditor General for Scotland is the Parliament's watchdog for ensuring propriety and value for money in the spending of public funds.

He is responsible for investigating whether public spending bodies achieve the best possible value for money and adhere to the highest standards of financial management.

He is independent and not subject to the control of any member of the Scottish Executive or the Parliament.

The Auditor General is responsible for securing the audit of the Scottish Executive and most other public sector bodies except local authorities and fire and police boards.

The following bodies fall within the remit of the Auditor General:

• departments of the Scottish Executive eg, the Health Department

• executive agencies eg, the Prison Service, Historic Scotland

• NHS boards 

• further education colleges

• Scottish Water

• NDPBs and others eg, Scottish Enterprise.

Audit Scotland is a statutory body set up in April 2000 under the Public Finance and Accountability (Scotland) Act 2000. It provides services to the Auditor General for Scotland and the Accounts Commission. Together they ensure that the Scottish Executive and public sector bodies in Scotland are held to account for the proper, efficient and effective use of public funds. 

Acknowledgements
This study was carried out on behalf of Audit Scotland by Margaret Ford, under the general direction of Caroline Gardner. 

We are grateful to those who completed the survey and who agreed to be interviewed as part of the review. We would also like to thank the members of the study advisory group for their input and advice throughout the study.

Foreword

In November 2002, the Auditor General published How Government Works in Scotland. The report explained the organisation of government in Scotland, the responsibilities of public servants and how they are held accountable, and the role of public audit in both  holding public bodies to account and supporting democratic scrutiny.  The report did not analyse or assess accountability mechanisms in place but was intended as a source 
of reference.

This report is one of a series which builds on the original reference work. Each of the reports in the series will comment, in detail, on specific aspects of the business of the public sector in Scotland which cut across a range of organisations.  The reports comment on the way the cross-cutting issues are handled by different parts of the public sector and the impact they have on the delivery of services.

Summary
 
Why does leadership development matter?

Over the last five years, there has been significant interest and activity in leadership development in the public sector and, in particular, in its relationship with improved public services. This preoccupation is evident across all areas of the public sector, both in Scotland and elsewhere in the UK, where the creation of specific leadership initiatives has been a key feature of the reform agenda in both central and local government.

Developing leadership capacity across boundaries is a model pioneered in Scotland since 1998. The Scottish Executive sponsored a national public sector task force which met throughout 2000 to consider these issues, and the Scottish Leadership Foundation (SLF) was launched in May 2001 as a direct consequence of its conclusions.

Delivering both the Programme for Government (1999) and the Partnership Agreement (2003) requires collaboration across different parts of the Scottish public sector. This has been reinforced by the way in which community planning has been embedded, with a clear emphasis on different parts of government and different agencies working together to deliver better public services. And there has been a clear recognition that, in order to achieve this, leadership development is essential.

The need for effective leadership of public services is now widely accepted; this report provides an overview of activity and investment in leadership development across the Scottish public sector.

Key findings
 
The local picture
•	There are some good examples of investment in leadership development which reflect aspects of world-class practice, but the picture across Scotland is highly variable.
•	Sixty per cent of organisations are investing in leadership development without any policy to direct this.
•	Twenty per cent of organisations are not able to say how much they spend on leadership development, and levels of investment vary considerably, even in organisations of the same type and size.
•	Most investment is being made in commissioning places on external training courses or in providing tailored in-house development events.
•	The way in which this investment is evaluated varies greatly. Twenty per cent of organisations are carrying out evaluation systematically, but over 50% have no process in place for evaluating their investment. Nearly 75% of organisations were unable or unwilling to link their investment in leadership to improved performance in their organisation.
The national picture
•	The Scottish Executive is investing substantial sums in a number of areas as a consequence of new policy initiatives, such as Enterprise in Education. There are wide variations in the level of investment. There is no mechanism for sharing intelligence on investment decisions across the Scottish Executive.
•	Both the NHS and local government in Scotland are adopting approaches to leadership development that offer nationally-set frameworks to guide locally-designed policies.
Cross-sectoral investment in leadership
•	Developing leadership capacity across organisational boundaries is growing in importance, reflecting key policies such as community planning. There is clear evidence of shared investment in leadership, especially between local government and health. There is enthusiastic support for development opportunities that bring together leaders from different organisations.
•	The SLF has made a significant impact in facilitating collaborative working. However, since it receives no core or committed public funding, SLF has had to supplement its role in researching and commissioning best practice by providing services directly, and this may limit its potential impact in practice.

Why leadership matters: a case study
Dalry Primary School, North Ayrshire

HM Inspectorate of Education (HMIE) report, 4 February 2003:
• 	‘Major weaknesses in leadership’, with poor relationships with staff.
• 	Little staff teamwork, lack of communication 
and resistance to change.
• 	Pupils’ mathematics is ‘good’, reading 
and writing is ‘fair’.
• 	Roll has fallen steadily for the past five years.
•	HMIE sets six main action points.
HMIE follow-up report, 26 April 2005:
• 	‘Very effective leadership’, characterised by ‘determination and flair’.
• 	Greater staff teamwork, duties fulfilled with commitment and enthusiasm’.
• 	‘Significant improvement’ in pupils’ reading, writing and maths.
•	Progress is ‘very good’ for five action points, 
‘good’ for one.
•	‘Clear evidence of positive impact’ on pupils’  attainment, and school’s morale.

In the space of two years, new leadership has turned a struggling North Ayrshire primary school into a success story

About three years ago, people told Maureen Denningberg she was mad.

She had applied for the head teacher’s position at Dalry Primary School in North Ayrshire, following a critical HMIE report on the school. Among its findings was one of ‘major weaknesses in leadership’.

“’Don’t do it Maureen,’ people said to me, ‘it’s too big a risk. You have an excellent reputation, why would you want to jeopardise it?’.” 

But where others saw obstacles and problems, Denningberg felt  she could see the way ahead; and that she knew how to take everyone with her. 

“The children were being failed and I was concerned as to why,” says Denningberg. “I knew the teaching staff were, in the main, very good. I knew the town was behind the school, and there was a really good mix of children. So what was the problem?”

Lacking vision
She started in June 2003 and soon found that staff were used to ‘managers, not leaders’. 

“Managers keep things ticking over, but they lack vision to move forward,” she says.

New initiatives had been ushered in without explanation. There was no understanding of processes or common goals, so people followed their own agendas. Staff would start initiatives but were not allowed to complete them. They were demoralised and had an ‘us and them’ culture.

“They worked very hard, but nothing ever changed,” says Denningberg.

For the pupils, the work was monotonous and catered to one learning style. When children moved into new classes each year, they would have to change to suit their new teacher’s approach.

Overall, staff and pupils lacked confidence and a sense of purpose and pride. 

Building confidence

Mrs Denningberg’s first task was to build the staff’s confidence. She says this is a slow process and people have to reach that destination largely by themselves.

“Teachers began to return from conferences and training, telling me: ‘They’re saying the same as you Maureen. And they’re experts.’ Letting these conclusions emerge for themselves is far more effective than trying to force it. The staff are now confident that if I say this is how it should be done, I’m right.”

She also standardised practices and insisted teachers adapted to suit children, ‘not the other way around’.
 
“The teachers were all working in their own little boxes. I instilled  an understanding that each class is accountable for the next. What we do in primary one impacts primary seven.” Denningberg also cracked down on quality. For example, she began monitoring photocopying.

“Not for any financial purposes, but to ensure it was of a high standard,” she says. 

“What kind of message does it send to a child if they’re presented with squint or poorly contrasted copies? (Similarly) the children’s work is always displayed on double-mounted card, because they’re worth it.” 

She introduced formalised prize-giving, and newly-established annual nativity plays, pantomimes and end-of-year shows. Pretty soon, the school's 26 teachers and 360 pupils rediscovered their pride in themselves and Dalry Primary.

Flexible leadership

The HMIE reported again on Dalry Primary School in April this year, highlighting Denningberg’s ‘very effective’ approach to leadership.

“It’s vital to have a clear vision, but don’t detail it all upfront. It can be too much too soon,” she says.

“You need to build confidence and trust, and you need to challenge before you can really get down to business. A ‘no-blame’ culture is essential if you want to try new things and go in new directions. Where managers work with existing capabilities, a leader spots potential and I’ve seen people blossom as a result of my interventions. 

“Get your dynamics right: fire up the right people at the right time. I don’t believe success comes from one leadership style. Sometimes I’m a dictator. Sometimes I’m manipulative. Sometimes I’m passive. Sometimes I’m collaborative. The key is using the right style at the right time.”

Part 1. Background

Introduction

Over the last five years, there has been significant interest and activity in leadership development in the public sector and, in particular, in its relationship with improved public services. This interest is evident across all areas of the public sector, both in Scotland and elsewhere in the UK, where the creation of specific leadership initiatives has been a key feature of the reform agenda in both central and local government. The drivers for investment may vary, but levels of investment in leadership development have been significant. 

Developing leadership capacity across boundaries has been a model pioneered in Scotland since the 1998 study Reinventing Management. It proposed a model of leadership that was explicitly intended to address capacity building across organisational boundaries and to share learning between organisations and sectors. 

‘The current climate in which organisations are led and managed requires public sector organisations to operate in a complex and complicated environment... a fragmented set of organisational arrangements often requires sophisticated partnership working to achieve success: a depth of commercial knowledge and understanding is needed to engage in successful projects requiring private finance or the involvement of private or not-for-profit partners; and a wide range of technical skill is required to lead modern, technologically smart and customer orientated organisations. These, in addition to the more traditional public policy and public management skills are amongst the range of skills and competencies required of today’s leaders in the Scottish public sector.’
Reinventing Management
Bolger and Pease, 1998. 
 
The analysis contained in Reinventing Management attracted strong support across the public sector in Scotland. Following work undertaken by a Scottish Executive-led national task force, the SLF was launched in May 2001 as a direct consequence.

Thinking has continued to develop, both in Scotland and the rest of the UK. The Cabinet Office Performance and Innovation Unit report Strengthening Leadership in the Public Sector (2001) key findings were that:

•	best practice in leadership development should be shared across public sector organisations
•	public services require a more mobile workforce and a wider pool of effective leaders
•	departments should both ensure that relations between politicians and client executives are clarified and promote initiatives in joint training of political and administrative leaders
•	secondments are an important tool for an individual’s development.
There has been a good deal of recent leadership development activity in England. Most of this has focused on single sectors or services; for example, the Local Government Leadership Centre was set up in 2004 as was the Leadership Foundation for Higher Education. The Academy for Sustainable Communities was created in 2005.

This single sector focus was recognised as a risk by the Cabinet Office in its 2001 study, and the new National School of Government (successor to the Civil Service College/Centre for Management and Policy Studies) has been established, in part, to promote effective leadership across the public service. Launching the School in June 2005, Sir Andrew Turnbull said that a key purpose of the new school was “better exchange of skills and knowledge between sectors and across the public sector.”

In Scotland, delivering both the Programme for Government (1999) and the Partnership Agreement (2003) requires collaboration across different parts of the Scottish public sector. This has been reinforced by the way in which community planning has been embedded, with a clear emphasis on different parts of government and different agencies working together to better deliver public services. And, building on the consensus created by Reinventing Management, there has been a clear recognition that in order to achieve this, investment in leadership development is essential.

This report provides an overview of current activity and investment in leadership development across the Scottish public sector:

•	Part 2  outlines the investment being made by major public sector employers in Scotland, and the range of local leadership development activity taking place.
•	Part 3 reviews what strategic or national activity and investment is taking place, including the role of the Scottish Executive, and others, in sponsoring this investment.
•	Part 4 considers how the collaborative or partnership model of leadership has developed, 
and also addresses the work of the SLF.
•	Part 5 sets out our recommendations.
Part 2. The local picture
The survey

We surveyed 145 public bodies across Scotland, covering central government and its agencies, non-departmental public bodies (NDPBs), local authorities, NHS bodies, further and higher education institutions and emergency services. The survey was intended to gather both quantitative and qualitative information on leadership development. Seventy-one responses were received from across the public sector, with particularly high response rates from further education colleges, universities and local authorities (Appendix 1).

We described leadership development broadly, as ‘any formal or structured development activity’ for senior people. We described senior people as the top two or three levels in each organisation, although we invited organisations to offer their own definition if this was not meaningful to them.

We have not taken a prescriptive view about models of leadership development since there are many, sometimes conflicting, views on what is most effective. Although there are many different perspectives on leadership development, a recent Cabinet Office study suggested some generic characteristics that were generally found in effective leadership development programmes. 

The Cabinet Office study acknowledged that ‘private enterprise dominates the concepts, models and cases in the leadership research literature, and that the public sector is not well-represented in the scholarly fields related to leadership’. Nevertheless, we have illustrated the framework here, as some of the examples we found in this survey of the Scottish public sector begin to reflect this world-class approach. 

In the survey, we provided space for organisations to describe, broadly, how they are investing in leadership development and how they are evaluating that investment. The survey was followed up through a range of interviews with individual organisations at local and national level.

The leadership cadre

There are significant differences between organisations and sectors in the way they define their leadership groups. In the NHS, 60% of organisations responding to the survey regarded non-executive directors as part of their leadership; 18% of councils included elected members; and 5% of further and higher education responses included college or court members as part of their leadership group. In total, the number of people in leadership positions covered by the survey is approximately 4,000.

Formal policies for leadership development

A policy or strategy for leadership development helps to link leadership development activity to the organisation’s corporate objectives, and to ensure that investment is targeted to the most important areas. Of the organisations who responded to the survey, 60% reported that they had no formal strategy or policy in place, although they all subsequently described activity taking place in leadership development.
 
During the course of the survey, the National Leadership Development Framework for the NHS in Scotland was being finalised, and the Local Government Improvement Service and COSLA were building on their National Workforce Development Plan. 

Many organisations referred to these national developments, and some stated that they were waiting for the outcome of this work before developing or finalising their own organisational policy.

Thirty per cent do have a policy or strategy for leadership development, typically reflecting the world-class framework described earlier, containing:

•	a business case for leadership development
•	clear links to the delivery of organisational objectives or service improvement
•	a picture of what effective leadership would look like – the ‘what’ and the ‘how’
•	a strategy for measuring the investment in leadership development (not all policies specified this).
Another ten per cent of organisations reported that they had a competency framework in place. This is an essential component of leadership development, but it misses key aspects of a comprehensive approach. It is also unlikely to provide an adequate framework for assessing the impact of investment. 

Levels of investment

We asked organisations how much they spend on leadership development activities. Many found it difficult to identify robust information on expenditure. Investment varied considerably across the organisations responding to the survey, and among organisations from the same sector. 

There was not always a clear correlation between size of organisation and amount invested; for example, one NDPB reported investing more than £100,000 annually, while a local authority 
of similar size reported investing less than £5,000. Almost half of the respondents reported spending between £5,000 and £20,000 
per year.

Overall, we estimate that up to £5 million each year is being invested in leadership development activities that are commissioned centrally by individual organisations. But the true figure is likely to be higher than this. Organisations with decentralised structures, especially local authorities and NHS bodies, felt that they were unable to identify all of the investment taking place.

Most organisations expected investment on training and development to be maintained over the next three years, with just over half believing that investment in their organisation would increase.

Leadership development activity

We asked organisations to describe the range of activities that their investment is supporting. Generally, individual respondents described a wide range of interventions that supported their leadership development processes, and this variety is consistent with the world class framework.

However, ten per cent of respondents were unable to provide this information; this strongly correlated with those organisations unable to provide expenditure data.

Most organisations were able to respond, and external training courses and tailored in-house programmes accounted for 60% of expenditure.

Evaluating the investment

Leadership development is important, in terms of both its cost and its potential to improve organisational performance, so 
its effectiveness needs to be evaluated. There are a number of frameworks for evaluation, such as the Kirkpatrick model (developed in 1959) and CIRO (developed in 1970). 

A fifth of organisations reported systematic mechanisms for evaluating their investment in leadership development, and described a range of approaches which equate to Kirkpatrick levels 3 and 4:

•	‘We use a range of techniques, for example employee attitude surveys.’
•	‘We relate our evaluation to original aims and objectives and try to establish levels of competence/confidence shift and impact on service provision.’
•	We use externally commissioned research to evaluate the impact of our programmes.’
•	‘Evaluation is completed for 
major initiatives to determine impact on service objectives and patient care.’
•	‘360º feedback is becoming an important tool in evaluation.’
A quarter of organisations reported having more basic levels of evaluation in place, which relate to Kirkpatrick levels 2 and 3, and a further quarter reported that they were working on this area.

However, almost a third said that they were not evaluating the investment at all. This is an area where there are significant differences across the survey, and there is scope for those who are further behind to learn from the best.

Taking it a step further

The ultimate aim of leadership development is to improve the performance of the organisation. Thirty per cent of respondents felt that they could make a link, directly or indirectly, between their investment in leadership and improved organisational performance, most of which would relate to Kirkpatrick levels 4 and 5. This was closely correlated with the existence of a policy on leadership development.

The remaining 70% of organisations were unable to link investment and organisational performance. This is an area where there is a significant gap between best practice and the rest. Whatever method of evaluation is chosen, there is a body of best practice in Scotland that could be spread more widely.

Joint or shared investment

Public bodies increasingly need to work together to deliver public services that meet the needs of their users, and shared leadership development is a critical way of supporting joint working. Just under half of organisations provided examples of joint development activity shared with others, most often between NHS bodies and local authorities, and between the emergency services. The Scottish Executive’s agencies and NDPBs appear least likely to share development activities.

Conclusions from the survey

The Cabinet Office study (Robertson, 2004) confirmed that there has been little published research carried out on approaches to leadership in the public sector. In that regard, this study makes an important contribution to that research. What is evident from this study is that, although there is a varied picture in Scotland, there are some organisations that already reflect world-class approaches taken by the private sector, rightly tailored to their own specific context. 

Bringing the world-class framework together with this research, we might conclude that investment in leadership development is most likely to be effective when the following critical success factors 
are satisfied:

•	Clarity about the key qualities of leadership for the sector.
•	Strategic alignment, whereby investment is carefully planned to reflect organisational goals 
and objectives.
•	Top management actively engaged in designing and supporting leadership development processes.
•	Careful candidate selection and preparation for development.
•	A range of appropriate development interventions are available.
•	High-quality, credible, teaching and facilitation.
•	Sustained employer support with reinforcing processes, such as performance management and succession planning.
•	Credible quality control and effective evaluation.

Recommendations

Investment in leadership development should take place within a clear policy framework, and aligned with organisational goals and objectives. There should be a clear sense of how such investment might link to organisational improvement and LDPs and processes should be guided by appropriate critical success factors. 

More rigour should be applied to managing investment in leadership development, especially in tracking overall levels of investment across organisations and in evaluating the effectiveness of that investment. Simple models, such as the Kirkpatrick framework, should be applied routinely.

Each public body should consider whether shared investment in leadership development would help to improve services, and make appropriate links to achieve this. This is particularly important at the community planning level.

Part 3. The national picture

Throughout the UK there is a preoccupation with leadership development and its relationship with improved public services. For example, the Audit Commission’s process of Comprehensive Performance Assessment has recently introduced a key line of enquiry on leadership effectiveness. And this preoccupation is evident across all areas of the public service, where the creation of specific leadership initiatives has been a feature of the reform agenda in both local and central government over the last five years. 

Levels of investment have been significant. The Local Government Leadership Centre (for England) was set up by the Office of the Deputy Prime Minister (ODPM) in 2004. It has received core funding from the ODPM of £12 million to cover its first three years of operation, in anticipation of working with 150 councils during that period. The Leadership Foundation for Higher Education is a UK-wide body set up in 2004. Through the Department for Education and Science, it has received core funding of £10 million to cover its first three years of operation. The Academy for Sustainable Communities (2005) has funding from ODPM of £10 million for its first three years.

In Scotland, a key role is played by the Scottish Executive, which has a dual role in relation to leadership development. As a major employer, it has a responsibility to develop and enhance leadership capacity as part of its own organisational development. The Corporate Learning Services team supports this work, and the Scottish Executive’s change programme, Changing to Deliver, addresses leadership.

But the Scottish Executive also plays an important role in sponsoring leadership initiatives across the public sector as part of its policy work. Participating in this study, the Permanent Secretary, John Elvidge, described his concept of leadership as follows: 

“Leadership is a frame of mind, a desire to take responsibility for moving forward. Every leader, every manager across the public sector needs to make sure that they kindle enthusiasm for change and improvement, both within the teams they lead, and with their relationships with other teams and other organisations. The role of the public sector leader is to provide a strong sense of direction and to support the continuing development of government to match public aspirations for post-devolution Scotland.”

And sponsorship of leadership development initiatives is often an important part of major policy implementation. These initiatives are important, both because of their overall cost and, more importantly, because of the scope they offer for leveraging improvement across the public sector. The next sections examine these national programmes in more detail.

The National Health Service Leadership Development Framework

This new framework, endorsed by ministers in 2005, is a comprehensive approach to developing leadership capacity on a national basis. It recognises that the NHS in Scotland is developing differently from other parts of the UK, and that these differences mean that NHS Scotland has to have a greater self-sufficiency in developing tomorrow’s leaders.

The new framework is clearly focused on improving services for patients and recognises that this will require leadership that challenges the status quo to deliver service excellence.

The Leadership Framework aims to:

•	describe the change context which must inform the leadership development agenda
•	describe the qualities of NHS Scotland leaders
•	identify national priorities for action in leadership development 
•	propose how NHS Scotland can work together – locally and nationally – and with partners, to develop leadership capacity and capability at all levels.
The framework is built around the following concepts:

•	In order to give strategic coherence, there will be a single, national approach to leadership development in NHS Scotland. This will be focused on the needs of the service, teams and individuals.
•	Within this cohesive approach there will be significant space for local systems to take forward the leadership development agenda and for professional groups to enhance specific skills.
•	The goals of improving health and reforming healthcare delivery cannot be achieved by the health service alone. Wider public sector engagement is critical and this needs to be supported by joint approaches to leadership development.
•	New approaches are needed to provide opportunities for career development and give flexible support to systems, where necessary.
“Fine words and intentions deliver nothing unless leaders catch the spirit of this framework, apply it both locally and personally and use it to deliver improvements in health and health services. The aim is to secure a cohort of motivated leaders, working to a common understanding of qualities and behaviours, and delivering real improvements for the people of Scotland.” 
Dr Kevin Woods, Chief Executive NHS Scotland: Introduction to The NHS Leadership Development Framework, April 2005.

The Health Department is investing approximately £1.5 million annually within the framework. This covers salaries for trainees on the national NHS Management Training Programme, nationally sponsored initiatives such as a Leadership Programme for Clinicians, individual support such as a coaching initiative for NHS board chairs and senior executives, and nationally funded organisational development initiatives aimed at developing leadership capacity. Funding does not enable any per capita estimate of expenditure for those in leadership positions.

The framework identifies a lead executive in each health board area who will be responsible for championing and coordinating leadership development activity, and sharing that knowledge and experience with the Health Department and, critically, with 
peers from other NHS systems. 
The Health Department has already put in place a system for coordinating the work of these lead executives. The framework also contains a commitment to start work on evaluating the impact of its national investment.

Health boards are required to submit two-year plans for leadership development, backed with resource plans; this is intended to ensure that national and local activities are coordinated and that there is no duplication of resources.

Leading to Deliver

This national programme was launched in 2003, following the Executive’s Action Plan for the Social Services Workforce and the subsequent report on the key challenges for leadership and management in social services. The programme was designed and delivered by the Taylor Clarke Partnership, a specialist development consultancy, and Robert Gordon University, which provided academic accreditation and guidance for the programme at post-graduate level.

The programme is entirely funded by the Scottish Executive, and was commissioned with the SLF who now manage the programme on behalf of the Executive. The programme is national in its scope, and is targeted at developing leadership capacity for first and middle line managers. Participants come from the statutory, voluntary and independent sectors, reflecting the nature of social services provision. When the fourth cohort is complete, the investment will total £2.6 million, covering about 400 participants at a cost of £6,500 each.

The Taylor Clarke Partnership carried out an evaluation of the first cohort, which concluded that it was too early for the full effects of the programme to be seen, but that there was evidence of its impact at the first four Kirkpatrick levels. Evidence from the reactions of participants, and the observations of their colleagues, suggests that, for many, the programme has been a powerful development experience.

It is not clear how this investment links to other corporate leadership initiatives taking place in councils. COSLA views this as a welcome initiative, but stresses the need to look for opportunities to roll out the benefits back in each workplace, particularly in engaging those people who have not participated in the programme.

Columba 1400 Head Teacher Leadership Activity (HTLA)

In 2002, the Scottish Executive published Determined to Succeed, a wide-ranging review of enterprise in education with 20 key recommendations covering the school curriculum, links with business, and work-based vocational learning.

Columba 1400 is one of a range of training and development pilot programmes underpinning the Determined to Succeed strategy, and like other pilots, it is funded jointly by the Executive and the Hunter Foundation. It aimed to influence:

•	the enterprise attitudes of participating head and deputy head teachers
•	the enterprise culture and ethos of the school
•	the development of the school curriculum
•	staff development and leadership
•	the subsequent educational attitudes and performance of pupils.1
The programme was designed and delivered by Columba 1400 and a core team of associates, and included:

•	an initial psychometric profiling exercise
•	a two-day pre-residential group programme held in Edinburgh
•	a six-day residential programme at Columba 1400’s Learning Centre in Skye
•	a follow-up visit to the programme member’s school 
for a half-day.
The programme covered 90 participants at a total cost of £397,250. The Scottish Executive contributed £198,625 of this and the Hunter Foundation contributed the same amount, in line with the original agreement over shared funding of pilots. The average cost per participant was £4,413.

An independent valuation was carried out by academics, led by Paisley University. They concluded that there were identifiable, 
if subjective, changes in head and deputy head teachers’ attitudes, behaviour, practices and learning outcomes. However, the impact on objectives associated with enterprise in education was limited. The evaluation team recommended that, if the programme is to continue, then the Scottish Executive should consider how it complements the existing CPD framework for teachers. 

The Scottish Qualification for Headship (SQH)

While the Columba 1400 HTLA focused on one element of the school leadership role, the SQH is a core programme aimed at fitting potential head teachers to lead 
their schools. It was established 
as a pilot programme in 1998, and has been fully operational since 2000. Since then, the Scottish Executive has invested £4 million to cover the costs of both this programme and other leadership activities for head teachers. 

The investment is channelled 
by the Scottish Executive Education Department (SEED) through the National Priorities Action Fund; funding is made available to 
local authorities to purchase places on the programme from the 
three consortia that provide it. 
The Scottish Executive does not have data on the cost of individual places, but the average investment for each completed place is estimated to be in the region of £6,300 per participant.

Higher education

The Leadership Foundation for Higher Education (LFHE) is a UK-wide body that was set up in 2004 with £10 million core funding from the Department for Education and Skills. The Scottish Further Education Funding Council (SFEFC) contributed 
£1 million over three years for the 19 higher education institutions (HEIs) in Scotland. The LFHE sees its role as assisting the sector to build leadership capacity and to spread best practice amongst its members.
 
The Foundation is closely focused on the needs of the sector, although it has made connections with other players in Scotland, such as the SLF. The Change Academy is a good example of its work (Exhibit 6).

Further education

The Scottish Further Education Unit (SFEU) (formerly an NDPB) is a self-funding charity owned by the Scottish Colleges. It supports capacity-building across a range of areas in further education colleges in Scotland, including the development of leadership capacity. Since 1998 it has supported capacity building for senior managers. One of its programmes, for serving Principals, is now in its third phase and has received total funding of £550,000 over a three-year period from SFEFC. All 42 College Principals are covered by the Programme. The investment by SFEFC represents an average of £13,000 for each Principal. 

The programme includes thematic workshops based on critical incidents, study visits, an international visit, and a two to three-day residential element. In addition, participants have access to a range of group activities such as site visits, 360o feedback, and mentoring, together with access to a virtual learning resource centre managed by Lancaster University. The first year of the programme was evaluated externally by York University and internally by SFEU. Neither evaluation has been published.

Nationally sponsored investment in local government

Like the NHS, local government is a key part of the public sector and a major employer. Since 2001, significant work on leadership development has been undertaken by COSLA, the Society of Personnel Directors Scotland (SPDS) and the Society of Local Authority Chief Executives (SOLACE). This work has focused on the need for a nationally consistent approach, with flexibility for each council to meet its own needs.

In 2002, COSLA and SPDS produced a workforce development Plan for local government. The Plan identified leadership as one of four key areas for action. The key success factors identified were:

•	commitment from councils to develop properly resourced leadership programmes
•	endorsement and commitment from COSLA leaders
•	identification of resources to progress leadership development activities
•	funding from the Scottish Executive to progress specific projects
•	identification of core national indicators
•	identification of a successful structure for a national leadership programme.
Since then, a new and distinctive leadership agenda has emerged for local government. The introduction of a new voting system in 2007 implies significant change in the way decisions are taken and political leadership is exercised. Many experienced politicians are expected to stand down in 2007, and more than half of current chief executives are also likely to have retired. At the same time, community planning and other forms of partnership working are becoming increasingly central to the role of local government. In this context, developing and supporting the new generation of local government leaders will be a significant challenge.

COSLA’s response has been to begin work on a Local Government Workforce Strategy to provide the politically agreed national framework to meet these challenges, including leadership development. This Strategy will also provide the context for the development support that will come from the newly created Improvement Service (IS) for local government. The IS Board comprises COSLA, the Scottish Executive and SOLACE, the organisation that represents local authority chief executives. It is charged with facilitating and supporting service improvement across the range of local authority activities, including leadership development. 

The IS has received funding of £4.5 million for its first three years and this needs to cover all of its activities and costs. The level of investment allocated to leadership development has to be struck against other priorities and although not yet finalised, is likely to be in the region of £350,000 over the three-year period.

As a professional body, SOLACE has a strong interest in development leadership capacity, and commissioned a review in 2004 to:

•	audit current activity, leading to the development of a uniform approach to leadership and management development activities
•	develop approaches for greater coordination and information sharing between councils, COSLA, SOLACE, SPDS and other partner organisations on continuing professional development.
The review was blunt in its conclusions:

‘Awareness of the need for leadership and management development has increased in recent years and Councils are actively engaged in this work. There is no consistency of approach and arrangements are very much determined on an individual council basis... There are a number of players, each of which has a direct interest, but without clarity of responsibility and activity there is a potential for duplication, confusion and also gaps in planning and provision.’

From this evidence, it appears that there is a real opportunity for a model of leadership development for local government that provides a national framework, with scope for each council to develop its leadership capacity to reflect its own distinctive approach and priorities. This reflects the approach taken by the new NHS framework, which has a national set of standards; local discretion; and a focus on the need for collaboration with others in the context of community planning and service improvement.

These leadership development initiatives are all funded, directly or indirectly, by the Scottish Executive, and most are sponsored by the Executive. There are significant differences in the cost of each initiative.

Conclusion 

The rationale for these differences in investment is not clear, and there are also questions about the coherence of planning for individual leadership groups. For example, under Columba 1400, the investment in enterprise in education appears to have attracted almost three-quarters as much funding per place as the core qualification for school leadership. Similarly, the links between the approaches for health and social work are unclear, although effective health and community care depends centrally on partnership working between the two groups of professionals. In particular, the level of funding for leadership in local government through the newly created IS is much lower than funding for other national initiatives, and it is not clear that this will be sufficient to provide the level of support required.

Overall, the Scottish Executive plays a central role in sponsoring capacity-building across the public services, involving significant investment. However, there appears to be no policy mechanism within the Executive for sharing intelligence on these initiatives so that decisions can be coordinated and good practice shared. Nor is there a mechanism for strategic commissioning of this kind of investment. The Corporate Learning Services team has recently created a network of training practitioners from NDPBs and agencies, the World-Class Leadership Development Group, but it has no formal authority and is not intended to provide advice on commissioning.

Recommendation

The Scottish Executive should put in place a robust mechanism for ensuring consistency and sharing experience in areas where significant investment is being made in leadership capacity building, both where it acts directly and through sponsorship of others, such as the Funding Councils.

1 Evaluation study, Paisley University, 2004.

Part 4. Cross-sectoral investment in leadership

The importance of leadership across organisational boundaries was recognised in the 2001 Cabinet Office report Strengthening Leadership in the Public Services: 

‘There are many leadership development initiatives and new leadership colleges and qualifications are being created. There is little evidence so far as to their effectiveness and too little attention is paid to the growing importance of leadership across organisational boundaries or to learning between different sectors.’

A model of collaborative leadership development emerged in Scotland three years earlier. In 1998, Eglinton Management Centre (supported by Scottish Homes and Scottish Enterprise) published Reinventing Management, which set out a model of collaborative leadership that would be fit for purpose in post-devolution Scotland. The model also reflected the development of community planning, and recognised that modern public services were not constrained by conventional organisational boundaries. The model was supported by the Scottish Executive and a task force was set up to take forward the recommendations of the report. 
The SLF was created in 2001 as a direct consequence.

Collaborative working in action

Just over 50% of organisations responding to the survey reported that they were engaged in some form of shared leadership development. Councils and NHS bodies were most likely to be working together. Community planning was the catalyst for some of this work; Fife provides a good example.

A strong philosophy of partnership has also driven the Scottish Executive’s flagship Change through People programme, which aims to develop leadership capacity across the public sector, and the Holyrood Summer School.

The Scottish Leadership Foundation (SLF)

The SLF was created by the Scottish Executive in 2001 in response to Reinventing Management. The original aim for the SLF was to act as an intelligent commissioning body to support leadership development across the public sector in Scotland. Reinventing Management identified a need for a foundation to have the following characteristics:

•	It would be employer-led and aim to articulate common development needs and aspirations.
•	It would have a small commissioning team which interpreted the needs of participating organisations and commissioned development interventions from a range of suppliers.
•	It would provide a focal point to commission research, design and delivery of novel approaches, possibly including new academic qualifications.
•	It might broker secondments across different parts of the public, private and not-for-profit sectors.
•	It could prepare people for roles as non-executive directors in public bodies.
•	It could commission and manage continuing professional development for MSPs and elected members of local authorities.
The SLF is an independent company, limited by guarantee, with its own board. Its portfolio of activities includes:

•	work with drug and alcohol action teams
•	cross-sector leadership work with agencies in Fife, Tayside, Forth Valley and Aberdeen
•	development forums for HR and OD practitioners
•	mentoring opportunities
•	staff exchange opportunities
•	organisational ‘raids’
•	work with specific professions, such as clinical leaders in the NHS
•	commissioning a new academic qualification in Collaborative Leadership at Lancaster University
•	supporting research into different aspects of leadership.
The Foundation has achieved many of the objectives of Reinventing Management. However, it has not developed in exactly the way that was envisaged; it engages in significant commercial activity as a provider of leadership development, facilitating or leading many of the programmes that it promotes, rather than acting solely as a client body, as originally envisaged. 

This reflects the Foundation’s funding model. The Foundation is funded through membership fees (35% of income) and through commercial activity. Unlike the leadership foundations in England, it received no committed funding at the time of its creation (although the Scottish Executive contributed the salary of the chief executive on a secondment basis for the first year of operation) and SLF has had to develop a commercial approach in order to survive. This has two significant consequences: it squeezes out time for work in areas such as research and development; and most importantly, it makes it difficult for SLF to act as a strategic procurement partner for public sector clients when it has to maintain a competitive position as a provider.

SLF has developed an important position in leadership development in Scotland, and its portfolio of activities has undoubtedly provided a catalyst for joint working in leadership development. It is involved in many national initiatives, such as Leading to Deliver. All of its activity is aimed at improving collaborative or cross-sector working, and the findings from the survey confirm that joint working, certainly between the major employer groups of the NHS and local government, is beginning to become embedded. Policy initiatives such as community planning have provided drivers for that change, but it is reasonable to conclude that the work of the SLF has also made a significant contribution.

It is possible that this contribution could have been greater. Certainly, there are significant public sector bodies, many local authorities for example, who are not corporate members of SLF and choose not to engage with the organisation’s activities.

Given the overall resources available for investment in leadership in Scotland’s public services, the way that SLF has been required to develop seems like a missed opportunity. The continued need for effective joint working and increased emphasis on leadership development makes the case for a ‘strategic best practice’ body arguably more compelling than in 2001. The prevailing thinking elsewhere in the UK recognises the need for a joined-up approach. This thinking was pioneered in Scotland where the government landscape and climate is well-placed to take full advantage of such an approach. However, the SLF was not adequately funded to carry out the original job, as envisaged. 

If there still remains an appetite for such an independent body, the key players (Scottish Executive, NHS and local authorities) would need to be less equivocal about supporting such an organisation. For a strategic best practice organisation to become a reality, support from all parts of the public sector would be required, and sustained funding would need to be put in place to enable such an organisation to carry out its role in an independent way.

Recommendations

There is a continuing need for a coordinating body to act on behalf of public bodies in Scotland, with the capacity to broker solutions, provide advice on strategic procurement, commission research and promulgate best practice. It should be funded and supported in a way that ensures it is independent of commercial activities and can carry out the full role effectively.

The Scottish Executive and other major employers, particularly the NHS in Scotland and local authorities, should consider how best to carry out this role.

Part 5. Recommendations
The local picture
Investment in leadership development should take place within a clear policy framework, and with a clear sense of how such investment might link to organisational improvement. 

More rigour should be applied to managing investment in leadership development, especially in tracking overall levels of investment across organisations and in evaluating the effectiveness of that investment. Simple models such as the Kirkpatrick framework  should be applied routinely.

Each public body should consider whether shared investment in leadership development would help to improve services, and make appropriate links to achieve this. This is particularly important at the community planning level.

The national picture
The Scottish Executive should put in place a robust mechanism for ensuring consistency and sharing experience in areas where significant investment is being made in leadership capacity building, both where it acts directly and through sponsorship of others such as the funding councils.

Cross-sectoral investment in leadership
There is a continuing need for a coordinating body to act on behalf of public bodies in Scotland, with the capacity to broker solutions, provide advice on strategic procurement, commission research and spread best practice. It should be funded and supported in a way that ensures it is independent of commercial activities and can carry out the full role effectively.

The Scottish Executive and other major employers should consider how best to carry out this role.

Appendix 1. List of respondents

Councils:
Aberdeen City Council
Aberdeenshire Council
Angus Council 
Argyll & Bute Council
Clackmannanshire Council
Comhairle nan Eilean Siar 
East Lothian Council
Falkirk Council
North Ayrshire Council
Orkney Islands Council
Perth & Kinross Council
Renfrewshire Council
Stirling Council 
South Ayrshire Council
South Lanarkshire Council 
West Dunbartonshire Council
West Lothian Council

Further education colleges:
Angus College
Ayr College 
Banff & Buchan College
Barony College 
Borders College
Cardonald College
Clydebank College
Cumbernauld College 
Dumfries & Galloway College
Edinburgh’s Telford College
Glasgow College of Nautical Studies 
Inverness College 
James Watt College
Jewel & Esk Valley College 
John Wheatley College
Langside College
Lauder College 
North Glasgow College 
The North Highland College
Oatridge Agricultural College 
Perth College
Reid Kerr College
Stevenson College
West Lothian College

Higher Education Institutions
University of Aberdeen
University of Dundee
Glasgow Caledonian University
Heriot Watt University
Napier University
University of Paisley
Robert Gordon University

NHS organisations
NHS Borders
NHS Fife 
NHS Forth Valley
NHS Glasgow
NHS Highland
NHS Lothian
NES Scotland
Golden Jubilee Hospital

Police and fire
Central Scotland Fire Brigade
Dumfries & Galloway Fire Brigade
Strathclyde Fire Brigade
Dumfries & Galloway Constabulary
Lothian & Borders Police
Strathclyde Police
Tayside Police

Agencies and NDPBs
Scottish Enterprise
Scottish Further/Higher Education Funding Councils
Scottish Natural Heritage 
Scottish Qualifications Authority
Historic Scotland
Student Awards Agency
Scottish Court Service

The Scottish Executive also responded, although this analysis was captured separately due to the dual role that the Executive plays in fostering leadership development.

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