Post #2: An evaluation of funding to support organisational effectiveness in Further Education

Earlier this year I was employed by the Learning and Skills Information Service (LSIS) to evaluate the impact of two funding strands on the Further Education (FE) sector. This is the second post that focuses on the evaluation of the ‘Organisational Effectiveness’ (OE) funding scheme.

This involved studying 50 projects, each running for one year, that were funded by the OE scheme. The aim was to identify factors that correlated with project success or failure, and provide recommendations to assist the FE sector and future funders. With the closure of LSIS, and with a new FE funder only just on the horizon (the ETF: Education & Training Foundation), I thought it would be useful to share the findings of this research.

The OE grants, of up to £25,000 (typically £20K) provided by LSIS, were intended specifically for use within leadership, management and governance. Most projects focussed on both improving efficiency and increasing effectiveness.

Broadly speaking this study found that the FE sector – particularly GFE Colleges – are coming round to the realisation that in a competitive environment they need to be more efficient, provide realistic and useful system measures, and prove increases in efficiency/effectiveness to both themselves and others. There is no doubt that the Organisational Effectiveness LSIS funding strategy provided a very useful platform for funded FE organisations to begin to realise this need.

A link to the full report (including 6 examples of successful projects) is provided at the bottom of this post. The most interesting findings of the LiT evaluation were as follows:

1. Return on investment was high (I was surprised how high)

Estimated savings per organisation in Year 1 varied between £1,750 and £412,000, with a median average of £43,565. If we remember that the average investment was £28,500 per project (£20,000 from LSIS and £8,500 from the organisation) this gives us a Year 1 ROI of 153%. If these per annum savings continue into Year 2 this increases to an average ROI of 305%. Only 6% of projects failed, so nearly everyone got something genuinely financially positive out of the experience.

I was amazed (and I am not usually amazed!). In fact, in some cases I was blown away. Many suggest that FE institutions should be funding change management themselves rather than awaiting support from external funders. Fair enough perhaps. But I had to admit that the gains to the end user, the institutions and the sector were phenomenal. And many said they wouldn’t have ‘upped their game’ if it weren’t for the presence of an external funder with high expectations and a clear project structure and deadline.

2. Savings are set to continue at least into years 2 and 3

Most projects anticipate savings to continue or grow throughout Years 2 and 3. The evaluation confirmed that initial predictions were reliable at least into Year 2. In some cases predicted savings were huge; for example one project (#31: Reducing curriculum delivery costs by teaching common QCF units across programmes and departments”) is on track for a ROI of over 600% by Year 3 – that equates to over £500,000 saved in three years.

3. The project gave organisations confidence to promote further change.
The survey showed that in 71% of cases the project had catalysed further positive organisational change. Examples are listed in the report.

Sadly results and findings were not published through LSIS as they closed as this project came to an end. However I have blogged the report here and will let ETF know about the work (they may already be aware, but anyway). Please pass this on to others who might be interested!

Link to the Organisational Effectiveness impact study (June 2013)