SUBMISSION FROM SCOTTISH ENTERPRISE
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- Harvey Shelton
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1 SUBMISSION FROM SCOTTISH ENTERPRISE Introduction Tourism is a priority sector for Scottish Enterprise and we have a long-standing and substantial involvement in the industry. We will seek to address the questions raised by the Committee in this submission but will focus on: The importance of tourism to the Scottish economy Current tourism strategy and implications for industry and the public sector The role, objectives and activities of the SE network in tourism Our relationships with other key organisations, especially HIE, VisitScotland and the Area Tourist Boards Key issues and activities in relation to skills and recruitment in the industry The SE/HIE Network involvement in tourism focuses on business development, skills and infrastructure / facility development. The economic importance of tourism The tourism industry makes a substantial contribution to the Scottish economy. Tourism: attracted earnings from outwith Scotland of over 2.9bn in 2001 supports employment estimated at 208,000, including an estimated 15,000 self-employed has strong links to other sectors so that a high proportion of tourism revenue results in income and employment for people in Scotland supports jobs and income in industries such as food, retail and distribution, transport and financial services. is particularly important as a provider of jobs and income in rural areas provides employment, training opportunities and core skills for young people - for many Scots it is their first experience of the world of work helps to support transport services and infrastructure that are important for the economy as a whole helps to support cultural, heritage and leisure facilities that also benefit the local community and enhance the attractiveness of Scotland as a place to live and work is a growth industry worldwide and, despite the difficulties of 2001, has the potential to make a long-term contribution to the Scottish economy Tourism strategy The Executive s Tourism Framework for Action sets out the key challenges facing the industry and the action to be taken by industry and government agencies. SE was closely involved in the development of the Framework document which drew on work carried out by SE with industry and partners over the latter part of 1999 and This reviewed the international competitiveness of the tourism industry in Scotland and concluded that major changes were required to turn round the performance of the industry. These included: building industry leadership the industry becoming more customer-focused increased innovation new forms of collaboration refocused public sector support. These issues are reinforced by work that SE has undertaken to examine international best practice in tourism. Key lessons from overseas include: The importance attached to gathering and disseminating market intelligence, with an emphasis on identifying trends and forward planning A clear focus on target market segments coupled with a sound understanding of their expectations and choices 1
2 A strong orientation to winning business from international markets A co-ordinated approach to product development, especially in realising the tourism potential of environmental and cultural assets Integration of local food and drink into the visitor experience The use of events to keep the visitor experience fresh and to help boost the image and reputation of countries and individual destinations New forms of public sector / industry collaboration which promote industry leadership and initiative Key challenges for businesses and the public sector The challenges set out above call for different behaviours on the part of both industry and public sector agencies. For tourism businesses, the modern tourism marketplace demands a high level of understanding of overall market trends and their own customers. There is a need for a fast pace of development of new and improved tourism products and services to maintain competitiveness. Adopting new approaches and techniques e.g. e-business, CRM, revenue management to enhance productivity and boost competitiveness. Alliances across tourism and tourism-related businesses are important in enhancing the quality of the overall visitor experience and in providing opportunities for new kinds of visitor products and services. The current tourism environment requires a high level of investment in the development of skills on the part of business managers and leaders. For the public sector, there needs to be a focus on the critical market failures that constrain industry development. These lie in areas such as: The branding and marketing of Scotland as a whole as a tourism destination Ease of access for visitors to comprehensive information and booking services Access for businesses to information on markets, trends, performance and competitors Making the right connections and alliances across tourism businesses and service providers to deliver an all-round visitor experience Development of links to other industries and resources to provide new and improved tourism products and services The operation of the labour market The provision of infrastructure such as transport, access to the countryside, sport, leisure and cultural facilities and activities, protection and enhancement of the built and natural heritage. Many of these are long-standing issues but the current business environment places more emphasis on facilitating and supporting business creativity and initiative, promoting an international outlook, and supporting the processes of business innovation, collaboration and skills development. Scottish Enterprise Network role in tourism SE s tourism objectives reflect the three themes of A Smart, Successful Scotland (Growing Businesses, Global Connections and Lifelong learning and Skills) but with a specific focus on supporting the industry to address the challenges set out earlier. The SE network has 3 key priorities in tourism which reflect our particular contribution to the implementation of the Executive s Tourism framework for Action. They are: Higher levels of innovation in product and service development An internationally competitive tourism infrastructure Attracting and developing the skills the industry needs, especially the development of business leadership and management skills In pursuing the above objectives our approach seeks to: 2
3 Encourage tourism businesses to take advantage of the general business support services available through SE e.g. business advisory services, e-commerce programmes, Investors in People, Modern Apprenticeships etc. Develop tourism-specific business support and skills solutions where required. Develop and deliver a consistent range of core tourism business and skills support products across the SE area Facilitate business collaboration to deliver improved tourism products and services, both at a local level and around key national products e.g. golf. Support the development of tourism infrastructure e.g. visitor attractions, countryside facilities and Public Realm improvements. Adopt an integrated approach within specific key tourism locations that links capital investment with support on business and skills issues. Address tourism interests within broader efforts to improve transport links to Scotland e.g. Rosyth / Zeebrugge ferry, air services. Provide the capacity to draw on wider SE budgets to support major tourism projects where there is a strong economic case e.g. Lomond Shores. Enable the tourism industry to draw on the wider economic experience of SE e.g. the cluster approach, university / industry linkages etc Deliver an integrated approach to economic development that maximises links to other aspects of the economy, especially in rural areas. These objectives are addressed through an annual tourism operating plan of key national and network-wide projects and programmes, supported by local projects delivered through individual LECs. Examples of current initiatives in each of the 3 key areas of innovation, infrastructure and skills include: Growing Businesses / Innovation Intensive support for tourism key accounts. Around 190 key tourism businesses with the potential to be industry leaders and generate significant wealth. Tourism business development programmes providing wider groups of tourism businesses with support through seminars and follow-up advice e.g. the Fully Booked programme to help businesses attract and retain customers. A Tourism Innovation Tool-kit to be launched early next year to give businesses the practical tools and techniques they need to be more innovative. support for the adoption of e-business e.g. through the First Steps seminars and SE s pool of e-business advisers. advice on business planning and marketing via the Small Business Gateway support for the development of local tourism business networks e.g. the Edinburgh Tourism Innovation Networks working with industry and partners on a Scotland-wide basis e.g. on golf, tourism and the environment, whisky & tourism etc. supporting events where these support overall tourism objectives e.g. the Balmoral Road Races, Burns Festival, International Festival of the Sea. development of university / industry links. A network of key tourism contacts in the universities has recently been set up. Support for the industry Tourism Innovation Group to champion new ideas, approaches and forms of collaboration across the industry. Infrastructure The development of key tourism facilities such as Glasgow Science Centre and Loch Lomond Shores. An ongoing programme of support to enhance the tourism appeal and competitiveness of existing attractions e.g. Culzean castle, Edinburgh Zoo masterplan. Comprehensive programmes to enhance the visitor experience at key tourist locations e.g. St Andrews. An early action programme of access, signage and environmental improvements for the Loch Lomond and Trossachs National Park. 3
4 With Forest Enterprise and other partners, support for the Seven Stanes network of forest mountain bike centres from the Tweed to Glentrool. Skills Support for the development of business leadership skills including: the Gleneagles tourism masterclasses learning journeys for tourism businesses to experience international best practice e.g. the Disney Institute, TQM in the German hotel sector seminars led by industry experts on specific topics such as service quality, revenue management Co-ordination of the programme of tourism-specific service quality training courses e.g. Welcome Host, Scotland s Best with over 70,000 participants to date. Promoting uptake by tourism businesses of Investors in People. Around 260 tourism businesses (c. 7% of the total) have IiP recognition. Many tourism businesses have gained a great deal of benefit from IiP which reinforces the critical link between skills and overall business objectives. Support for Modern Apprenticeships. MAs can help tackle skills shortages and find young people jobs in good tourism businesses. In Glasgow, for example, support is being provided to MA programmes in the hotel and restaurant sectors with good progress to date. There is scope for wider uptake of MAs in tourism building on best practice such as that in Glasgow. SE and HIE support for Tourism People the industry-led body set up to promote effective recruitment and development practices, in particular the link between skills development and meeting the needs of customers. It is still at an early stage in its development but will have an important role in taking skills messages and best practice out to industry and creating co-operative industry solutions. the establishment of the tourism recruitment web-site currently being piloted in Edinburgh. initiatives to match people to tourism job opportunities e.g. the Edinburgh Tourism Recruitment Initiative and efforts to help local people take up job opportunities in projects such as Loch Lomond Shores. Support through SE and HIE for the Springboard Scotland tourism careers organisation. In recent years Springboard has put in place a substantial effort to promote career opportunities in the tourism industry. SE welcomes the proposal for a Sector Skills Council for the tourism and hospitality sectors. This will be important in building on the work of the tourism-related NTOs on skills needs, the labour market, and links with the educational sector. These will, however, be UK-wide organisations and we hope that there will be a strong Scottish dimension to SSC proposed for tourism and hospitality. Transport In addition to tourism-specific activity the Network also addresses the transport needs of the tourism industry within broader efforts to encourage the development of transport services to and within Scotland. SE was instrumental in attracting the new Superfast Ferries Rosyth-Zeebrugge service the first daily direct service linking Scotland to the European continent. SE is also providing support to Forth Ports with the new passenger ferry terminal at Rosyth due for completion shortly. 4
5 Scottish Enterprise is active in promoting and encouraging the development of European and transatlantic air services. Along with VisitScotland, Scottish Executive and HIE we are exploring the possibility of developing a 5-10 year route development strategy. This will include an assessment of establishing a route development fund. Route development in Scotland will form part of the Government s review into "The Future Development of Air Transport in the United Kingdom" which is presently out for consultation. This will help form the basis of a UK White Paper in Spring SE Network tourism spend SE Network spend on tourism varies from year to year as it is affected by the incidence of spend on major capital projects e.g. Loch Lomond Shores. Estimated spend by the SE Network on tourism-specific projects in the current year 2002/2003 is 14.5m. This only includes spend on tourism projects where this can be separately identified. Many SE business and skills support programmes are cross-sectoral and it is not possible to separate out spend on tourism. This is split across the main areas of activity as follows: Innovation 5,721k (39%) Infrastructure 7,392k (51%) Skills 1,394k (10%) SE believes that this level of spend is justified in helping to secure the long-term competitiveness of this major industry. SE focuses on businesses, infrastructure and helping to ensure that the quality of the product on the ground matches the expectations of an increasingly sophisticated market. This, in turn, is important in getting value from the VisitScotland and ATB spend on marketing Scotland as a tourist destination. Without the right quality of experience to back the marketing promise, the effects of marketing activity will not be sustainable. Joint working with HIE, VisitScotland and the ATBs SE has a long-standing tradition of co-operation with HIE on skills initiatives and there is an extensive range of existing joint initiatives across SE, HIE and VisitScotland e.g. Support for product development initiatives: Golf Tourism strategy, Tourism and Environment Forum (also with SNH), Genealogy, Whisky and Tourism, Natural Cooking of Scotland Support for industry bodies and initiatives: Tourism People skills group, Tourism Innovation Group, Scotland United annual tourism conference The tourism industry web-site Standing arrangements for SE International Operations and VisitScotland staff to meet to co-ordinate overseas marketing strategies and activities. At a local level there is joint working across LECs, ATBs, Local Authorities and industry on area tourism strategies, visitor surveys, product development and industry forums. There are, however, areas where collaboration across the Enterprise networks and VisitScotland and the ATBs can be improved. New joint working arrangements are currently being put in place with an initial focus on the areas of product development and integration of business support services. In this latter respect, proposals emerging from the Local Economic Forums offer an important opportunity to remove duplication and improve signposting to help tourism businesses access the full range of support services (tourism-specific and generic) through local support organisations. 5
6 Conclusions The poor performance of the industry overall, even pre FMD and 9/11, made it clear that a different approach was required in many aspects of tourism. The lessons in terms of what needs to be done differently are clear from international best practice. There are promising signs in the best practice which exists across the industry in Scotland and in forward looking initiatives such as the new Tourism Innovation Group, the establishment of Tourism People, and an interest in exploring new linkages with related industries such as food, whisky and sport. We believe the approach that is required is adequately encapsulated in the Tourism Framework for Action and the task now is to build a critical mass of activity at all levels that reflects the kinds of behaviours which are now required. The changes we are trying to promote are challenging and there must be commitment on the part of industry leaders and government to see this through. Scottish Enterprise September
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