The British Council. Achieving Impact

Transcription

1 The British Coucil Achievig Impact REPORT BY THE COMPTROLLER AND AUDITOR GENERAL HC 625 Sessio Jue 2008

2 The Natioal Audit Office scrutiises public spedig o behalf of Parliamet. The Comptroller ad Auditor Geeral, Tim Burr, is a Officer of the House of Commos. He is the head of the Natioal Audit Office which employs some 850 staff. He ad the Natioal Audit Office are totally idepedet of Govermet. He certifies the accouts of all Govermet departmets ad a wide rage of other public sector bodies; ad he has statutory authority to report to Parliamet o the ecoomy, efficiecy ad effectiveess with which departmets ad other bodies have used their resources. Our work saves the taxpayer millios of pouds every year: at least 9 for every 1 spet ruig the Office.

3 The British Coucil Achievig Impact LONDON: The Statioery Office Ordered by the House of Commos to be prited o 9 Jue 2008 REPORT BY THE COMPTROLLER AND AUDITOR GENERAL HC 625 Sessio Jue 2008

4 This report has bee prepared uder Sectio 6 of the Natioal Audit Act 1983 for presetatio to the House of Commos i accordace with Sectio 9 of the Act. Tim Burr Comptroller ad Auditor Geeral Natioal Audit Office 29 May 2008 The Natioal Audit Office study team cosisted of: Tim Bafield, Neil Carey, Sascha Kiess, Jaey Sacoto, Leae Sheldo, Kevi Summersgill This report ca be foud o the Natioal Audit Office web site at For further iformatio about the Natioal Audit Office please cotact: Natioal Audit Office Press Office Buckigham Palace Road Victoria Lodo SW1W 9SP Tel: [email protected] Natioal Audit Office 2008

5 contents summary 4 PArT oe Itroductio 7 PArT TWo Deliverig customer-facig activities 10 PArT Three measurig Performace 22 APPeDiCes 1 Detailed recommedatios 30 2 British coucil Resources 34 3 Product areas for Eglish teachig 35 ad exams 4 The British coucil s ew performace 36 measuremet tools 5 Study methodology 37 Photograph o frot cover, cotets ad page 4 courtesy of Goh Seg Chog. Photograph o page 7 courtesy of Matt Wright ad photographs o page 10 ad 22 courtesy of Nick Fraser.

6 SummARy 1 The British Coucil is a Registered Charity, a executive No-Departmetal Public Body ad a Public Corporatio. The Coucil is operatioally idepedet of Govermet ad its aim is to build mutually beeficial relatioships betwee people i the Uited Kigdom ad other coutries, ad to icrease appreciatio of the Uited Kigdom s creative ideas ad achievemets. It has described itself as the UK s iteratioal orgaisatio for educatioal opportuities ad cultural relatios, ad operates i some 110 coutries. I it received some 195 millio from public grats, maily from the Foreig ad Commowealth Office, ad eared a further 350 millio pricipally by teachig Eglish, deliverig examiatios overseas ad maagig cliet fuded cotracts. 2 The role of the British Coucil was cosidered by Lord Carter of Coles i his review of UK Public Diplomacy i 2005 ad agai by the Select Committee for Foreig Affairs i The Select Committee oted that the Carter review did ot have a value-for-moey focus as part of its remit, ad recommeded that the Natioal Audit Office cosider coductig a Value for Moey Report o the Coucil. I their deliberatios, the Committee for 1 Public Diplomacy is defied as Work aimig to iform ad egage idividuals ad orgaisatios overseas, i order to improve uderstadig of ad ifluece for the Uited Kigdom i a maer cosistet with govermetal medium ad log term goals. Review of UK Public Diplomacy by Lord Carter of Coles December Third Report of the Foreig Affairs Select Committee , Public Diplomacy. 4 AcHIEvING ImPAcT

7 summary Foreig Affairs expressed wide-ragig iterest, both i how the Coucil used its resources ad i how it measured its performace. This examiatio cosiders whether the British Coucil uses its resources ecoomically ad efficietly ad adequately measures ad ehaces its impact i meetig public diplomacy objectives. Our examiatio, summarised i Figure 1, icluded the Coucil s key support services, the way it develops ad delivers services to customers, ad its Performace Measuremet systems. Fidigs from our work o the Coucil s support services ad its far reachig programme of chage are published i a separate o lie report. 2 3 Our overall coclusio, based o our work overseas ad i the UK, is that the British Coucil s performace is strog ad valued by its customers ad stakeholders, although it is a challege to secure cosistetly good performace across such a dispersed global etwork. The Coucil is flexibly allocatig its resources to alig with ew UK priorities, ad cotiues to implemet umerous ad extesive chage programmes aimed at icreasig its effectiveess ad efficiecy. Maagig so may simultaeous ad iter depedet projects has preseted challeges. There is a eed for improvemet i support fuctios ad i terms of the maagemet iformatio ad tools that it has i place to ru its busiesses. 4 Sice , the British Coucil has moved from coutry-specific cultural ad educatioal projects to fewer, larger regioal ad global products, maaged uder a cetral commissioig process. Early large scale projects have see icreasig audiece umbers, ad risig customer satisfactio. However, Regios have ot moved to commissioed products i a cosistet way or at similar pace. The Coucil s fiace ad maagemet iformatio systems do ot yet sufficietly support project plaig ad delivery i this ew, more complex, regioal ad global eviromet, where staff located i may coutries eed to work closely together. There has also bee isufficiet project maagemet traiig to support staff. Geeratig support ad fudig from local parters is critical to project success, but sposorship ad parter icome has falle sice I 2007 the Coucil developed a ew strategy to geerate icreased sposorship ad parter icome. 1 The scope of the Natioal Audit Office examiatio (mai features) Key support services ad chage maagemet 1 Customer-facig activities (Part 1) Outcomes (Part 2) Chage Maagemet People Maagemet The Eglish Laguage Teachig ad Examiatios Busiess The curret system to measure the Coucil s activities ad impacts Iformatio Techology Fiacial Maagemet Grat-fuded cultural ad educatioal activities The Coucil s performace as show by its Scorecard Procuremet Estates Maagemet Customer Service Excellece iitiatives ad Customer Relatioship Maagemet systems Chages i progress to improve performace measuremet, (i cojuctio with other UK bodies ivolved i public diplomacy) Source: Natioal Audit Office NOTES 1 Fidigs from our work o the Coucil s support services are published olie at 2 The methodology used to coduct the examiatio is described i Appedix 5. 3 The mai exclusio from the scope of the study was the Coucil s work uder cotract for a rage of UK ad Iteratioal agecies, maily i support of Iteratioal Developmet Programmes. Such work is wo uder competitio ad at least covers its costs overall. Primary resposibility for the value for moey of this work lies with the agecies procurig it. 2 At Achievig Impact 5

8 summary 5 The British Coucil s 181 millio Eglish laguage teachig ad examiatios busiess has a high reputatio i the market ad is fiacially successful, geeratig surpluses i places such as Hog Kog ad Spai which are used i part to support teachig cetres i less established markets, some i the developig world. Its best cetres operate i a maer comparable with good busiess practice i major private sector laguage schools. The teachig ad exams busiess also provides a platform for other activity i support of UK public diplomacy, particularly by helpig overseas govermets expad the teachig of Eglish i their educatio systems. But the busiess has a high cost base, charges premium prices, ad has achieved limited reach outside overseas capital cities, with the umber of teachig cetres reducig rather tha expadig i recet years. 6 The British Coucil s curret systems to measure its performace are well desiged: they provide a good mix of iformatio; pricipally o the scale of its activities, customer satisfactio ad perceptio chages, the perceptios of key UK stakeholders ad of Coucil staff. Some improvemets could be made to the way data is collected ad collated. The Coucil is workig with the Foreig ad Commowealth Office ad the BBC World Service to ehace performace measures for public diplomacy. These improvemets are well-coceived, but i order to be affordable, it is likely that the Coucil will have to implemet these selectively. Coclusios ad Recommedatios Our recommedatios are expaded o i greater detail at Appedix 1 i The Coucil does ot yet fully uderstad the implicatios of its move from local to regioal projects or the savigs geerated through beefits of scale. It iteds to move to eve larger, global projects from April The Coucil should verify whether o average large scale projects have geerated greater outcomes at least i proportio to their greater cost. Measures may iclude direct audiece size per 1,000 spet, customer satisfactio scores ad the ratio of grat to exteral fudig. ii iii iv v vi I movig to regioal projects, Regios have bee able to commissio projects i differet ways ad have achieved differig rates of progress. This, coupled with the challeges of staffig ad coordiatig large multi-coutry projects, has tested the Coucil s overall programme ad project maagemet. I itroducig its ew process to commissio large scale projects, the Coucil should raise the cosistecy of project maagemet i the UK ad across the overseas etwork. Chage should iclude better mechaisms for poolig successful project desigs, tighter cotrols o project fudig ad improved traiig for project maagemet staff. Exteral fudig from parters ad sposors has declied sice 2001 ad there are large variatios betwee coutries; half of the etwork geerates almost all the Coucil s exteral cotributios. The Coucil should cofirm the reasos behid acute variatios i exteral fudig betwee coutries, ad more cosistetly apply its policy o workig with private compaies across its etwork. We recommed a corporate target to at least restore exteral fudig to 2001 levels (equivalet to 16 per cet of total Coucil resources). The Coucil has idetified a umber of ways of expadig the reach of its Eglish teachig ad exams operatios. But it eeds to demostrate more clearly to its stakeholders ad competitors how growth supports the Coucil s missio ad charitable purposes ad that it does ot represet ufair competitio. The Coucil ca draw o methods used by, amogst others, the BBC, to give added assurace o fair competitio. The Coucil is icreasigly recogisig the importace of good customer service, but it is ot yet meetig all of its customer service excellece improvemet targets. The Coucil should develop a agreed specificatio for a commo customer relatioship maagemet tool to eable it to track customer cotacts ad better uderstad its audieces across its etire busiess. The Coucil s published coutry ad regioal performace scorecards ted to cocetrate their reportig o positive customer commets. The Coucil should report a balace of positive ad egative customer commets through its coutry ad regioal scorecard reports, i order to promote trasparecy ad to better idetify areas for improvemet from a wider rage of sources. 6 Achievig Impact

9 PART ONE Itroductio The Status ad Roles of the British Coucil 1.1 The British Coucil was fouded i 1940 through a Royal Charter. For policy ad admiistrative purposes it is classified as a executive No-Departmetal Public Body ad it is registered as a Charity. Its aims are set out i Figure 2 ad a brief overview of the Coucil s mai activities is at Figure 3 overleaf. Whilst workig withi agreed themes ad priorities, the Coucil remais operatioally idepedet of Govermet. I practical terms, this meas that it decides for itself which products ad services to deliver, to which audieces ad usig what methods. 2 The objects of the British coucil eshried i its Royal charter The objects for which the coucil is established ad icorporated are to advace ay purpose which is exclusively charitable ad which shall: promote a wider kowledge of the uited Kigdom; develop a wider kowledge of the Eglish laguage; ecourage cultural, scietific, techological ad other educatioal co-operatio betwee the uited Kigdom ad other coutries; or otherwise promote the advacemet of educatio. Source: Royal Charter 1940, supplemeted The Coucil s icome is derived from a variety of sources, icludig grat-i-aid from the Foreig ad Commowealth Office (FCO), which sets strategic objectives for UK public diplomacy, (Figure 4 o page 9). 3 A fiacial memoradum with the FCO icludes the Coucil s resposibilities for fiacial maagemet ad to achieve value for moey, as well as provisio for the Comptroller ad Auditor Geeral to examie the ecoomy, efficiecy ad effectiveess with which it uses its resources. A Public Diplomacy Board chaired by a Foreig ad Commowealth Office Miister ad icludig the Coucil s Chief Executive coordiates the overall UK Public Diplomacy effort; specifically work udertake maily by the FCO, the Coucil, ad the BBC World Service. 1.3 The British Coucil has o direct iteratioal peers. Probably its closest aalogue is Germay s Goethe Istitut, which promotes Germa culture overseas, ad teaches the Germa laguage i the home coutry (ulike the Coucil) as well as overseas. Frech cultural diplomacy is pursued through a etwork of govermet departmets, agecies ad alliaces. The Uited States pursues public ad cultural diplomacy largely from withi the State Departmet. US authorities commeted to Lord Carter s Review that their public diplomacy has bee less effective tha the UK s, due i part to the lack of strog, idepedet supportig istitutios ad brads, such as the BBC ad the Coucil. 4 Stakeholders i foreig educatioal ad cultural establishmets compare the Coucil favourably to other iteratioal istitutios, ad felt that these istitutios should use the British Coucil as a model. 5 3 Public Diplomacy is defied as work aimig to iform ad egage idividuals ad orgaisatios overseas, i order to improve uderstadig of ad ifluece for the Uited Kigdom i a maer cosistet with govermetal medium ad log term goals. Source: Review of UK Public Diplomacy by Lord Carter of Coles December Source: Lord Carter s Report o UK public diplomacy 2005, Aex E. 5 NAO iterviews with stakeholders durig field visits, ad NAO Commissioed research ito o-users of British Coucil services. AcHIEvING ImPAcT 7

10 part oe Chagig priorities ad approaches 1.4 It is iheretly difficult to maage a orgaisatio dispersed to over 100 coutries worldwide, esurig cosistet global stadards of efficiecy ad effectiveess whilst at the same time givig sufficiet autoomy to i coutry teams to respod flexibly to local circumstaces. Util 2004, the Coucil s approach required each coutry operatio to iteract directly with the corporate cetre i the UK. Though a corporate strategy ad policies were set, idividual Coutry Directors had cosiderable autoomy to determie what services their offices should offer, to what audieces, ad how local support fuctios such as huma resources ad property maagemet would be ru. 1.5 I 2005, the British Coucil embarked o its Strategy 2010, a five year chage programme affectig the whole orgaisatio iteded to deliver high quality products ad services more efficietly to bigger audieces. It has ivolved reorgaisatio ad ratioalisatio i the UK ad overseas, radical chages i product desig ad delivery, ad implemetatio of a major ew resource maagemet system. The chage from 110 coutries to a regioal maagemet structure based o 12 regios, (Appedix 2), has give the Coucil a basis to esure that its activities are more cosistet worldwide. 3 Key Iformatio about the British Coucil Overall Reach Iformatio Services Staff Eglish laguage teachig ad examiatios Worked i 110 coutries/territories, icludig the UK. As a result, the Coucil worked directly with 16.5m people, maily through its large scale projects ad Eglish laguage teachig ad Exams activities. Over 15 millio uique visitors used British Coucil websites, ad viewed 108 millio pages. Olie resources iclude materials for learig the Eglish laguage. Employed 1,100 staff i the UK ad 6,800 overseas. Employed over 2,000 teachers who taught 1.2 millio class hours of Eglish to 300,000 learers i 53 coutries. Delivered 1.3 millio UK exams to 925,000 cadidates worldwide, brigig 25 millio i export earigs for UK exam boards. Work with govermet miistries i most coutries i the Middle East, North Africa ad Cetral Asia, providig teachig traiig for Eglish ad support for moderisatio of the state educatio system. Educatio Lead delivery parter for the Prime Miister s Iitiative ad UK-Idia Educatio ad Research Iitiative. Activities iclude: establishmet of 23 higher educatio parterships likig istitutios i the UK with Idia parters. recruitmet of oe millio iteratioal studets ito UK educatio. Promotig iteratioal school liks betwee the UK ad overseas, reachig 4.7 millio studets. Promotig iteratioal school liks betwee the UK ad overseas, reachig 4.7m studets. Developmet cotracts Arts Examples of other grat-aided activities Implemeted 141 developmet cotracts i more tha 40 coutries worldwide to a value of 51 millio. Cotracts were commissioed by UK govermet departmets ad the EU. Held 1,435 arts evets aroud the world. 63 coutries participated i ZeroCarboCity, the Coucil s climate chage programme. So far 2.5 millio people have directly participated i the programme. Media coverage of the programme has geerated a further audiece of a estimated ie millio people. The Coectig Futures programme, aimed at fosterig uderstadig betwee youg people, was deployed i 44 coutries ad ivolved 30,000 participats. The IterActio leadership programme, operatig across Africa, buildig youg leaders skills i govermet, civil service ad busiess. Developig leadership skills ad cross-cultural awareess amog youg people through sport. The Coucil s Dreams & Teams programme ivolved 424 schools i 43 coutries, ad 280,000 people i their schools ad commuities. Source: British Coucil 8 Achievig Impact

11 part oe 1.6 Liked to these chages, the British Coucil is also movig resources across its etwork to respod to resource limitatios ad to better alig with UK strategic priorities. A key elemet is a relative shift from areas such as Wester ad Cetral Europe, towards the Islamic World ad emergig ecoomic powers such as Idia ad Chia. For example, i Prague the Coucil has reduced its operatio from 23 staff developig ad deliverig bespoke local products ad evets, to a team of ie focused o deliverig global ad regioal products developed elsewhere. Cultural agecies i other coutries express a similar aspiratio, but have struggled to attai it. Officials i the Germa Foreig Miistry felt that Germa public diplomacy efforts were less focused ad less flexible tha the UK efforts, ad that i spite of their desire to focus o Easter Europe, the Middle East ad Asia, it was provig difficult to shift away from more traditioal areas. To illustrate the challege, the Goethe Istitut was said to sped per cet of its resources i Frace ad Italy where much of the fudig is tied up i fixed costs such as buildigs ad salaries. There are seve separate offices i Italy aloe, ad attempts to reduce overheads are felt to be slow, with a target of brigig that figure dow to 20 per cet by Aother factor is that, like Frace, a large proportio of the Foreig Miistry s culture budget (oe third) is devoted to subsidisig their etwork of schools overseas. 6 Progress to date by the British Coucil is summarised i Appedix 2. 4 The British Coucil s mai sources of icome ad areas of expediture Sources of Icome millio Grats (pricipally 188 millio Grat-i-aid from 195 the Foreig ad Commowealth Office) Work uder cotract (for UK Departmets, 122 iteratioal developmet agecies, ad the EU) Fees ad icome from services (maily Eglish 232 laguage teachig & examiatios) ad other sources Iterest eared 2 Total Icome 551 Expediture agaist programme areas Icreasig learig opportuities ad stregtheig 235 educatioal co-operatio Buildig appreciatio of ad stregtheig 71 egagemet with UK creativity Stregtheig good goverace ad huma rights 31 Promotio of Eglish Laguage learig 206 Other costs. Corporate goverace ad 6 otioal cost of capital Total Expediture 549 Mai Assets (at valuatio) Lad ad Buildigs 86 Equipmet (maily IT) 16 Source: British Coucil aual report ad accouts Lord Carter s Report o UK public diplomacy Achievig Impact 9

12 PART TWO Deliverig customerfacig activities 2.1 The British Coucil delivers projects ad services, icludig Eglish laguage teachig ad exams, to customers across five mai busiess sectors; arts, educatio, sciece, goverace, ad Eglish. Part 1 of this report examies the delivery of the Coucil s customer facig activities, as well as the measures i place to maage its customer relatioships. How the British Coucil targets its work 2.2 Workig i may large coutries, the Coucil eeds to target its fiite resources to maximise its ability to meet its corporate objectives. It has to target its work to best effect withi very large ad complex host coutry populatios, ad cocetrate resources o those who have, or i time are likely to have, the ability to ifluece policy or decisio makig i its busiess areas. The Coucil idetifies three mai audiece groups, segmeted by the level or potetial ifluece of the cotact; T1 High-level decisio-makers ad leaders: are people i key positios of ifluece icludig govermet miisters, importat media figures ad commetators, leadig sports or culture persoalities, atioal religious leaders ad UK-based ambassadors of overseas coutries. T2 Key ifluecers: are curret (or potetial) leadig members of orgaisatios, groups ad etworks who develop or deliver policy, or have a sigificat ifluece o the lives ad opiios of others. They ca also be gatekeepers who provide access to T1 cotacts. T3 People with potetial: are far more umerous. They ted to be youger (uder 35) ad idetified by category rather tha beig i key positios. They iclude studets of Eglish or those wishig to study overseas. T1 ad T2 groups are also sub-divided ito geographic locatio ad sector, depedig o the eeds of each specific coutry or activity. Defiig audieces 2.3 Elastic defiitios of target audieces mea that the British Coucil has difficulty i adequately prioritisig resources betwee groups. Historically, the Coucil has placed a high premium o developig persoal relatioships with T1 ad T2 cotacts ad sees them as vital to makig their work a success. For example, securig seior level buy-i from the Chiese Miistry of Sciece ad Techology has bee vital to the success of the Climate Cool Chia project, (page 12). 2.4 Target audieces are ot rigidly defied, ad there ca be disagreemets over whether a particular type of cotact is a T1, T2 or T3. Earlier versios of the target audiece guidace also icluded a T4 category which equated to wider groups of educated people ad the geeral public. The Coucil is icreasigly recogisig the potetial of the T3 audiece, both i terms of its size (Idia aloe has 380 millio people aged betwee 15 ad 34, who could have the potetial to become T3s) ad its potetial to geerate the T1 ad T2s of the future. Segmetig the T3 audiece ad prioritisig key sectors withi it for attetio, is vital to targetig the Coucil s resources. The Coucil has specified factors which should be cosidered whe determiig the target T3 audiece, icludig age, the ability to pay for services, geographical locatio, ad lifestyle. Oce these groups are defied, further research ca be doe o their characteristics, which Coucil activities are most likely to egage them, ad how best to market these. 2.5 All Coucil Regios were due to have completed a market segmetatio ad research audit by July Some Coucil operatios have made good progress. British Coucil Idia ad Chia have both carried out detailed research ito the characteristics of their potetial T3 audiece ad have segmeted these ito groups which are assiged various levels of priority (Figure 5). British Coucil Idia is usig the research to develop its ew Youg Audieces Project aimed at egagig youg, urba, educated Idias i Coucil activities. But other coutries 10 AcHIEvING ImPAcT

13 part two are further behid. By December 2007, three of the 12 regios had ot carried out ay segmetatio work. While corporate guidace o marketig priciples ad a step by step guide to segmetatio is available o the Coucil s Itraet, it is ot cosistetly applied throughout the etwork. Few coutries have reached the stage where the idetificatio of specific audiece groups has bee used i developig specific projects or targetig services. Developig iovative products 2.6 Iovative regioal ad global products are icreasig audiece reach ad impact, but are challegig to deliver cosistetly across the etwork. The British Coucil speds some 95 millio of grat fuds per year o a diverse rage of projects. It geerated a further 23 millio 7 from exteral sources. For example Shell, KPMG, Glaxo Smith Klie, BAE Systems, BP ad Shell are ivolved with the UK Idia Educatio ad Research Iitiative project to improve educatioal liks betwee Idia ad the UK. The Coucil also uses exteral parters to help deliver projects. For example, the Coucil works with Volutary Service Overseas o the Global Xchage project, which supports the developmet of active global citizes through a series of iteratioal voluteerig exchage programmes for youg people. 2.7 Sice , the Coucil has begu to move to a ew approach for desigig ad deliverig its diverse rage of projects. It is shiftig the focus away from locally developed, coutry-specific projects to fewer, larger products at a regioal ad global scale, delivered uder a more formal commissioig process ad champioed by a ewly formed Commissioig ad Iovatio Support Office. Regioal ad global projects will ivolve more people ad have the potetial for greater impact (for example, the Coucil s UK Idia Educatio ad Research Iitiative was aouced by the Prime Miister ad has so far attracted several large corporate sposors), as well as providig opportuities to make savigs based o usig commo project templates across multiple coutries ad regios. At the time of writig most of these larger scale projects are i relatively early stages of delivery, ad it is too early to coclude o the success of the trasitio as a whole. This part of the report examies the Coucil s experieces to date. 2.8 The British Coucil has already developed some iovative ad well-received projects across its rage of activities ad its key busiess sectors: Art, Eglish, Sciece, Goverace ad Educatio. These rage from highly focused coutry-specific projects aimed at a small umber of T1 ad T2 audieces, such as the Idia Naotechology project aimed at developig mutually beeficial relatioships betwee Naoscietists i the UK ad Idia, to Coectig Classrooms, a 5 millio project aimed at reachig over oe millio youg people (T3s) i Africa. 5 British Coucil Idia has idetified six T3 groups to focus their resources o Characteristics Aged 19 24, strog Eglish, low price sesitivity, high iteratioalism ad high aspiratios Aged 25 29, strog Eglish, low price sesitivity, high iteratioalism ad high aspiratios Aged 15 18, strog Eglish, high price sesitivity, high iteratioalism ad high aspiratios Aged 30 34, strog Eglish, low price sesitivity, high iteratioalism ad high aspiratios Aged 15 18, weak Eglish, high price sesitivity, low iteratioalism ad high aspiratios Aged 19 24, weak Eglish, high price sesitivity, high iteratioalism ad high aspiratios Source: British Coucil Idia ad Sri Laka Ivestmet priority High High Medium Medium Low Low Mai reaso for egagemet They are likely to be future opiio formers, are opemided ad have potetial to act as multipliers (positively ifluecig their peers). Ofte early adopters, potetial to act as multipliers, will be gaiig positios of ifluece withi their orgaisatios ad commuities ad are potetially ope to creative ideas from the UK. Potetial to become future opiio formers ad possibly wat to study overseas at some time i the future. Geerally time poor, but i positios of ifluece. Are potetially ope to creative ideas from the UK. Potetial to act as multipliers ad may wat to ivest i gaiig higher level academic qualificatios. They have high aspiratios ad could potetially be ope to UK creative ideas. Their families are willig to ivest i improvig their prospects. They have high aspiratios, are potetially ope to creative ideas from the UK ad are willig to ivest i improvig their prospects. 7 Cash ad o cash doatios, such as free veue use or sposored flights. Achievig Impact 11

14 part two Coectig Classrooms: East ad West Africa ad Souther Africa Regios The Coectig Classrooms project forms partership clusters, each of three schools (oe i the UK ad two i Sub-Sahara Africa). The aim is to promote itercultural dialogue (oe of the British Coucil s three programme areas) ad icrease kowledge ad uderstadig of differet societies. It was approved i February 2006 as oe of the earliest Regioal projects, ad acted as a pilot for a ew dual key project commissioig process ivolvig the Commissioig ad Iovatio Support Office. Durig ad the first two quarters of , the project reached over 232,000 people. As at Jauary 2008, the project was supportig 84 parterships, which icluded 750 schools, ad a total school populatio of aroud 600,000 studets. Climate Cool Chia Climate Cool Chia is a two year programme to raise awareess of ad promote ways to tackle Climate Chage, through a series of programmes such as workshops, UK Chia exchages, exhibitios, competitios ad awardig schemes. It was developed followig the success of British Coucil Chia s Zero Carbo Cities project, which eded i April Scopig work started i Jue 2006, usig a UK-based climate chage commuicatio cosultacy ad the project was formally started i March 2007, although some elemets preceded sig off, for example a Climate Ambassadors programme was ru i late Climate Cool will maily target youg, educated urba professioals aged It will focus o Where the target audiece comes from Urba school childre aged What the target audiece buys the Cosumer idustry Who the target audiece liste to the Commuicatio idustry A Midsummer Night s Dream, Idia ad Sri Laka Regio I 2004, British Coucil Idia refocused its arts programme to better attract ew audieces, icrease co-productio to develop relatioships betwee the UK ad Idia arts sectors, ad support creative etrepreeurship. 2.9 The British Coucil has traditioally delivered sector-specific ad coutry-specific projects, but its ew approach will icrease the umber of projects which spa multiple sectors ad regios. For example, British Coucil Chia s Climate Cool Project ivolved staff from the Sciece ad Educatio teams ad has sice bee exteded to East Asia. The Idia ad Sri Laka regio has merged its sector teams ito cross-disciplie project teams with sector specialists actig as cosultats across projects. The Coucil has some way to go before its projects work ca take full advatage of the large T3 populatio already reached through the Coucils Eglish Laguage Teachig busiess, due to problems capturig cotact iformatio ad prefereces (paragraphs ). The Coucil is curretly reassessig its project portfolio to esure its large scale projects represet the best meas of achievig its revised corporate outcomes (Appedix 4) which may lead to some projects beig discotiued or merged Iitial feedback from customers has bee positive. Early idicatios are that larger Regioal projects are startig to geerate icreased audiece satisfactio scores, though the data set is as yet too icomplete to be statistically coclusive. It is difficult to measure the eormity of the impact made by our Africa visitors The visit made the partership real ad gave it a ew level of importace to all... It allowed for a icrease i the kowledge ad uderstadig of the differet cultures ad helped to break away from stereotypes that people have of each other. UK participat i Atelope partership, Coectig Classrooms, April 2007 Govermet iovatio aloe caot solve social problems. We also eed iovatio from civil society. This (Social Iovatio) coferece will cotribute to the harmoious developmet of Chia, referrig to Chia s recet commitmet to achievig a balace betwee ecoomic growth ad social welfare. Attedee at the British Coucil s Social Iovatio Iteratioal coferece i Beijig i October 2006 I 2006, the British Coucil commissioed a productio of William Shakespeare s A Midsummer Night s Dream by UK director Tim Supple usig actors from across Idia. The productio toured four Idia cities (Delhi, Mumbai, Cheai, Kolkata) ad the performed i the UK, i partership with the Royal Shakespeare Compay. The productio had a total audiece of aroud 10,000, with a estimated further 5 millio people reached idirectly through the media, ad received favourable reviews. Despite the success of the productio, the Coucil ecoutered problems securig sposorship ad had to reduce the tour from eight to four cities. 12 Achievig Impact

15 part two The trasitio to larger scale projects 2.11 Progress i movig to large scale projects is variable betwee Regios, but audiece size ad project scale are already icreasig. I , oly 16 per cet of the Coucil s programme expediture was o large scale (regioal or global) projects ad 84 per cet local (Figure 6). I , this has moved to 45 per cet programme spedig o large scale projects ad 55 per cet o local projects. The Coucil s target is that by 2011, 80 per cet of programme expediture will be o large scale projects. As a result, sigle coutries will be uable to roll out sigificat projects outside their regio s priorities ad the corporate commissioig process, as they will ot have the ecessary budgets. 6 All British Coucil regios are shiftig towards larger scale regioal ad global projects, though at very differet rates Regioal projects as a percetage of total project sped Near East & North Africa Chia & Hog Kog Idia & Sri Laka East Asia Cetral & Souther Asia Lati America South East Europe West Europe & Americas NACE & Russia Middle East East & West Africa 2.12 Although may regioal projects are i the early stages of implemetatio, there has bee a evidet icrease i the scale ad scope of projects; from average aual spedig of aroud 40,000 per project i to 246,000 i , ad a reductio i the umber of projects each regio progresses. I East ad West Africa, the umber of projects has reduced from over 200 to aroud 60 sice The aticipated reach of projects has also icreased: the Coectig Classrooms project has a target audiece of 1.3 millio youg people i 19 coutries across Sub-Sahara Africa The British Coucil must balace its eed to tailor projects to local circumstaces with the advatages of projects delivered i a cosistet way across multiple coutries. Movig away from local projects meas that the Coucil will have to work to maage expectatios ad to maitai relatioships with existig customers. Local projects will remai the resposibility of Coutry Directors ad be based o developig local relatioships. They will be fuded from coutry budgets, so the Coucil will have to balace the ability of local projects to respod rapidly ad flexibly to emergig opportuities i a coutry, with the eed to esure that projects are still plaed, delivered ad evaluated rigorously. At preset, o stadard busiess case or project iitiatio documet is required for local projects ad the quality of project plaig documetatio that the NAO reviewed was variable Smaller coutries have already show that regioalisatio will eable them to roll out projects which they would ot have bee able to do aloe. British Coucil Tazaia is participatig i IterActio, a 4 millio per aum Leadership traiig project coverig over 20 coutries i Sub-Sahara Africa, ad which is ow beig exteded to Pakista. Though a relatively small Coucil office with seve project delivery staff, Coucil Tazaia was able to draw o plaig ad developmet work by other Coucil staff across the Souther Africa Regio ad the UK. However, experiece i rollig out early regioal ad global projects has demostrated the importace of beig able to tailor projects to coutryspecific circumstaces. For example, the Climate Cool Chia project allowed the Coucil Hog Kog to select the right combiatio of project elemets to fit with its wider project portfolio. Souther Africa FY FY Source: British Coucil Achievig Impact 13

16 part two Challeges to project maagemet 2.15 Larger ad more complex regioal projects have posed challeges to good project maagemet. Each regio has maaged its ow trasitio to regioal projects ad has set up its processes as appropriate to feed ito commissioig. This has led to variatios i project developmet ad plaig, ad i the stage at which regios sought approval to proceed. Projects were, i some cases, well ito detailed plaig before beig set for sig-off by the cetral Commissioig ad Iovatio Support Office, makig ay sigificat chages difficult to icorporate, ad projects were seldom rejected at this stage. Moreover, there have bee o cotrols to prevet projects from startig before beig formally approved while budgets have bee held at a regioal or coutry level. For example, the Social Iovatios project i Chia was iitially set for sig off i September 2006; but 78,000 was spet before this, i order to deliver a major coferece i October The dual key sig off was ot completed util August 2007 at which time actual project expediture was 208,000. From April 2008, the Coucil iteds to stregthe Commissioig by releasig fuds at key stages withi the project approval process, to prevet such problems recurrig Larger Coucil operatios have foud that developig regioal projects requirig iput from sector staff across differet coutries has placed more demads o their staff time. As projects become larger ad more complex, the plaig phase icreases i time ad cost, ad more resources are required at a early stage; a typical regioal project will have a plaig phase of six to ie moths, ad some of the largest projects, such as IterActio, ca take twice this. The Coucil does ot yet have a system of time loggig for all staff. This meas that accurate data o staff costs per project is ot available; staff time is apportioed to the project based o the percetage of their work allocated to it i their job descriptio rather tha actual time spet. The Coucil caot yet measure how much effort the ew regioal projects are takig to develop, ad what the overall effect will be of movig to eve larger ad more complex global projects. Uder the ew Commissioig approach, to be itroduced i , the Coucil iteds that the iitial stages of project developmet will be shorter, therefore avoidig large amouts of time ad moey spet o projects which may ot ultimately go ahead Rollig out larger ad more complex projects across atioal ad lie maagemet boudaries also requires more sophisticated project maagemet skills. British Coucil staff who respoded to a NAO olie survey cited that project maagemet traiig was iadequate or ot available. 8 The Coucil has yet to decide o the corporate stadard to adopt for project maagemet traiig. Some regios have arraged their ow traiig to esure that staff are sufficietly skilled to deliver larger projects. For example, Idia commissioed a exteral cosultat to trai its project staff after problems arose i the project maagemet of A Midsummer s Nights Dream (see paragraph 2.20) Maagig ad moitorig regioal projects is also challegig as curret Coucil systems do ot yet fully eable regioal workig. For example the dispersed Coectig Classrooms project team foud that moitorig project expediture was more problematic where participatig coutries use a mix of old ad ew resource maagemet systems. They idetified a eed for more corporate guidace o how to maage project fiacig. The Coucil s curret fiacial plaig system allocates fudig o a coutry basis, accordig to corporate priorities. This ca cause difficulties over how to fud projects which require a regioal source of fiace ad how to match project fudig with coutry, regioal ad corporate priorities. From April 2008, the Coucil iteds to hold programme fuds i a global pot, allocated to the Regios depedig o their project portfolio ad corporate priorities. Project fudig will be released at certai trigger poits so that regios will oly be able to progress a project oce it has bee formally approved. Geeratig exteral fudig 2.19 Geeratig exteral fudig ad resources has had limited success across the etwork. The Coucil has log recogised that a successful strategy to geerate more cotributios from exteral sources ca eable it to deliver programmes ad impacts o a bigger scale. These exteral sources ca be UK-based or foreig private compaies, multiatioals, volutary bodies such as charitable foudatios, or public sector agecies withi host coutries. The cotributios take the form of cash paymets towards Coucil-led projects, or cotributios i kid, such as loaed staff, facilities or publicity. Egagig suitable parters is icreasigly critical to project success, ad ca provide further beefits, such as commercial expertise, local kowledge, or better access ad cotact with the iteded project audiece. 8 The NAO s olie survey of British Coucil staff is published o the NAO website at 14 Achievig Impact

17 part two 2.20 As Figure 7 shows, cash icome from sposorship ad commercial parterships has falle substatially sice 2001; from 16 per cet of the Coucil s total icome to just 4 per cet i the last five years. Whilst the Coucil has ot systematically aalysed the reasos for the fall, we have idetified a umber of cotributory factors: The Coucil has moved away from fudig evets such as prestigious music cocerts or theatre tours uless these have specific purposes cosistet with UK strategic priorities. Traditioally such major arts evets attracted commercial sposorship. Opportuities to raise sposorship were ot always grasped. For example, the 2006 Midsummer Night s Dream tour of Idia, whilst well received by audieces, was almost etirely fuded by public moey (equivalet to some 20 per audiece member), because efforts to raise sposorship did ot firmly commit the mai sposor i good time. Staffig difficulties were a factor. The et cash cost was limited to some 167,000 by reducig the tour to four rather tha eight cities. The Coucil has recogised the lessos ad a follow-up productio i 2008 has raised over half of the estimated 230,000 cash budget from parters, plus a further 10 per cet from box office receipts. The tour is plaed to reach twice as large a live audiece as did the 2006 tour. 9 Maximisig sposorship requires a active partership betwee Coucil staff i the UK ad aroud the world. Major UK compaies ad multiatioals have differet practices but usually major sposorship fuds ad decisios are reserved for corporate headquarters, rather tha budget holders i idividual coutries, which makes it more difficult for coutry ad regioal project teams to geerate major fudig without UK ivolvemet. The Coucil has a small commercial team of five based i Lodo which besides determiig corporate policy ad circulatig guidace ad good practice, has a importat role i brokerig relatioships with major UK corporates. It more tha covers its costs by fud-raisig, attractig some 440,000 i , ad fuds two further commercial posts i Idia The Coucil s success i fud raisig ad commercial parterships has varied greatly from Coutry to Coutry (Figure 8 overleaf). I half of the Coucil s coutry operatios geerated 99 per cet of its total cotributios from the private sector ad 90 per cet of those from public ad volutary bodies. Variatio is ot always explicable by low local ecoomic prosperity, weak private or volutary sectors, or other difficult operatig cotexts. British Coucil Idia has raised substatial cotributios recetly by closely ivolvig major UK compaies i the UK Idia Educatio ad Research Iitiative. I cotrast, i Spai commercial participatio had bee miimal. Globally, variatios reflect: Icosistet applicatio of Coucil policy o workig with compaies; for example to address variable staff perspectives o whether or ot it is acceptable to work with eergy compaies to preset climate chage evets ad products; 7 The British Coucil s icome from sposorship ad commercial parterships has falle steadily sice millio Percetage Cash I Kid Total exterally geerated as a percetage of total Coucil resources Source: Natioal Audit Office aalysis of Coucil data 9 I the 2008 tour, the ivolvemet of a televisio compay also provides distributio to a much larger broadcast audiece. Achievig Impact 15

18 part two The eed for greater clarity about the owership of global or regioal products that will be delivered across more tha oe coutry, ad early decisios durig project desig about whether to pursue sposorship ad participatio at the global, regioal, or local level, or a combiatio of these. The Coucil s ew arragemets for commissioig products requires more specific commitmets o the plaed sources of fudig, though early experiece i usig these has bee mixed. For example for Coectig Classrooms, the Regioal Project Maager ad a exteral cosultat developed a pla to raise 2,484,000 sposorship icome. Despite iitial iterest from potetial fudig parters, this pla was cacelled while awaitig a strategy for the global Coectig Classrooms project. A umber of schools have sice secured fudig or doatios from local parters, for example subsidised air travel to eable Nigeria schools to visit UK parters. The ability ad cofidece of Coucil staff to close partership deals with parters, withi plaed project delivery timescales The Coucil aims to do better i future. A Commercial Director appoited from the private sector i mid-2007 has developed a ew strategy, a key elemet of which is a ew etwork of 40 i-house champios to stimulate activity i each busiess area ad regio. A traiig programme is beig developed, with the first modules curretly beig rolled out. Some coutry operatios have also recruited busiess developmet maagers. It is too early to say how far such iitiatives will help to reverse the adverse tred of the last five years. The British Coucil s Eglish laguage teachig ad exams busiess 2.23 The Coucil teaches Eglish to approximately 300,000 studets i 54 coutries ad admiisters exams to over a millio cadidates i oe hudred coutries. The objectives of the teachig ad exams busiess are to deliver strategic impact by forgig relatioships with the Coucil s idetified target audieces, whilst ruig these services o a full cost recovery basis which at least covers its costs ad delivers surpluses to the corporate cetre. It geerates substatial impact ad icome, but the Coucil recogises the potetial to develop this further ad is lookig to chage the way it operates I , Eglish teachig ad exams geerated 181 millio i icome, a icrease of 27 per cet over the last five years; most of that growth beig derived from admiisterig examiatios (Figure 9). Exteral factors icludig the SARS virus, the Gulf War ad foreig exchage movemets adversely affected the busiess betwee 2003 ad The Eglish ad Exams busiess operates a risk reserve which is either draw o or repleished accordig to swigs i the busiess cycle. 8 Coutry performace i raisig third party cotributios Private sector Public sector (cash ad i kid) (cash ad i kid) Top Five Coucil operatios raked by private sector cotributios Thailad Chia Malaysia Japa UK Commercial Parterships Team 440 N/A Half (57 of 115) Coucil operatios reported private sector cotributios uder 10,000. These icluded Idoesia 0 0 South Africa 0 5 Uited Arab Emirates 0 0 Keya 0 0 Germay 5 47 Source: Natioal Audit Office aalysis of British Coucil Global Fudig Returs 16 Achievig Impact

19 part two Sice 2005 it has recovered ad i it delivered a surplus, (after deductio of all local, corporate ad ivestmet costs directly attributable to the busiess) of 10 millio. The surplus is used to fud idirect overhead costs ad ivestmet projects across the Coucil. This effectively supplemets the FCO s grat-i-aid ad the orgaisatio s grat-aided fuctios. The Coucil does ot report explicitly o this wider beefit i its published report ad accouts. Nor does it collate ad disclose the staff-hours ad fiacial cotributios provided by teachig cetres to grat-aided programmes The surplus geerated i strog Eglish teachig markets such as Europe or the Far East eables the Coucil to offer teachig ad exams i coutries where the market would ot sustai a fully commercial retur. I , Eglish teachig cetres i five cities; Madrid, Sigapore, Hog Kog, Seoul ad Barceloa geerated over a third of total icome ad about half of the gross cotributio for Eglish teachig. Missio critical cetres i 10 coutries, maily i the developig world, sustaied a small overall loss of 0.6 millio. Where coutries make losses, the Coucil is followig two paths. First, sice 2005, the Coucil has closed te cetres which had performed poorly i fiacial terms ad were cosidered ot to have cotributed sigificatly to strategic aims of buildig relatioships with target audieces. I other coutries, the Coucil has refocused its operatios more closely oto the target audiece. For example, over the past five years the Dar Es Salaam teachig cetre i Tazaia had cosistetly sustaied a loss. Difficult local market coditios ad the cost of providig expatriate teachig staff had led to geeral Eglish courses beig offered at a loss. The teachig cetre is movig away from geeral Eglish courses to teachig busiess Eglish as part of a suite of maagemet traiig courses. These courses provide access to Tazaia s future busiess leaders ad geerate a better retur o ivestmet, with the cetre forecast to break eve i A better product offer, based o market research, ca eable a fiacially successful operatio which targets key audieces eve i difficult markets. Applyig good commercial practices 2.26 The teachig ad exams busiess is successful, though good commercial practice could be more cosistetly applied. The Coucil s activities i Eglish teachig ad exams comprise seve mai product areas; adult learers, youg learers, professioal learers, olie cotet, peacekeepig Eglish ad teacher developmet (Appedix 4). I October 2007, the Coucil aalysed across the etwork for the first time the et fiacial cotributios from its differet products. Such aalysis is importat i iformig maagers o how best to chage the products offered to customers locally, ad o where the orgaisatio cetrally should develop ew products. The Coucil s aalysis showed that adult ad youg learer teachig each geerated almost half of the total teachig cotributio, with adult teachig geeratig the highest cotributio per studet, ad youg learer teachig geeratig a higher cotributio per teacher hour due to larger class sizes. The two mai examiatios offered each represeted a third of busiess, but oe geerated much higher cotributios per exam. 9 Eglish Teachig ad Exams: Growth i turover ad surpluses has come maily from the examiatios busiess millio Fiacial Year Teachig Icome Exams Icome Source: British Coucil Achievig Impact 17

20 part two 2.27 Idividual teachig cetres are required to aalyse ad report to the corporate cetre oly gross icome ad busiess volumes i respect of most products ad have had discretio over how far to aalyse profitability. Util the Coucil s ew Fiace ad Busiess system, curretly beig itroduced, maagers have ot had tools to aalyse profit margis easily, though this more powerful system will require accurate apportiomet of costs if it is to support soud decisios. Of the cetres we visited, oly the large cetre i Hog Kog already demostrated robust ad active maagemet of product profitability. Its busiess maagers use margi aalysis of each timetabled class to iform decisios o premium pricig, the commissioig or de-commissioig of courses or the developmet of ew products. We foud much less evidece i other cetres of detailed margi aalysis, for example to vary pricig to ecourage off peak tuitio. We also foud that, eve though the Coucil charges premium prices for Eglish teachig, the cetres were oversubscribed with waitig lists at peak times. This strogly suggests that the market is there to expad profitable product lies if the Coucil ca adopt other suitable busiess models ad practices There is little evidece globally that the Coucil has a systematic ad documeted approach for market testig ad opeig ew cetres. Guidace exists o how to research a area i order to establish if it would sustai a Coucil teachig cetre, but awareess ad applicatio of this was limited i the cetres we visited. Dedicatig sufficiet skilled resource to busiess developmet is vital i icreasigly competitive eviromets for both teachig ad exams. I 2002, the Australia compay IDP decided to offer examiatios i the Iteratioal Eglish Laguage Testig System (IELTS) qualificatio i Idia, i competitio with the Coucil s ow offerig. 10 IDP etered ito a partership with a local busiess, which adopted iovatios such as easy olie registratio ad targetig the most profitable States with aggressive marketig. By 2007 the Coucil had lost two thirds of its market share for IELTS i Idia, ad it has respoded with the appoitmet of a marketig maager to try to reverse the tred. The Coucil s stadard busiess model for Eglish Teachig 2.29 Historically, the British Coucil has adopted a stadard busiess model which limits its ability to maximise its fiacial performace ad its audiece reach. The Coucil s stadard busiess model for Eglish Teachig has bee deliberately positioed i the market as a high cost /high quality/high price oe, drive maily by the relatively high cost of its premises (paragraphs ) ad its teachers ( ) I most coutries teachig cetres are co-located with the Coucil s grat-aided operatios. Some 49 of the 70 cetres are i capital cities, usually i promiet busiess or admiistrative districts chose primarily to help the Coucil iteract successfully with key decisio takers ad ifluecers. Co-locatio was reaffirmed i the Coucil s Strategy But the Coucil also recogises that operatig a teachig busiess out of such locatios ca be a costrait, i terms of accessibility to potetial customers ad the relatively high premises ad capital costs it ca impose. High corporate stadards of fit-out have also bee applied to meet perceived expectatios of a British Coucil operatio. The Eglish teachig busiess has to compete with other Coucil programmes for capital resources to ivest i remodellig or expadig the etwork, to better reach potetial customers who live outside the catchmet areas of its curret cetres. 11 Recet research coducted by the Coucil suggests that existig ad potetial customers place less value o a promiet ad attractive buildig tha was previously perceived to be the case, ad place great value o quality teachig ad a locatio coveiet to their homes or workplaces Aother factor i the Coucil s busiess model, which teds to drive up course prices is that daytime utilisatio of classrooms i most cetres is low, with demad for teachig higher i the eveigs ad at weekeds, as most studets are either i full time educatio or employed. Off-peak markets ofte pursued by private sector schools, such as mothers ad youg childre, require particularly coveiet locatios which the Coucil is ofte ot i the right place to provide. Such markets ted ot to be corporate priorities for the Coucil, but they ca make a major cotributio to esurig fiacial viability ad to broadeig the reach ad capabilities of the teachig busiess where there is spare capacity. The cosequeces of poor fiacial performace ca be closures: i 2005 the Coucil s Czech operatio closed its cetres i the cities of Pilse ad Bro, havig foud that these markets had become more price-sesitive tha Prague. 10 IDP is a co-ower of the IELTS test, with the British Coucil ad the Cambridge ESOL exams provider. 11 Capital Ivestmet i the teachig busiess was 1.3 millio i Achievig Impact

21 part two 2.32 I all eight teachig cetres we visited, maagers idetified the availability of suitable teachig staff as the key costrait i their coutries o expadig operatios withi existig cetres or ito outside capital cities. 12 A Coucil survey, carried out i 2007, showed that 46 per cet of cetres reported it was always or ofte difficult to recruit teachers based o curret levels of busiess. Utilisatio of full time teachig staff i the cetres we visited was high, with extra capacity eedig to be created for peak times i eveigs ad at weekeds through recruitig part time staff. A high proportio of teachers are recruited i the Uited Kigdom ad periodically rotate aroud the etwork, though some are recruited locally, ofte from expatriate commuities. The UK-recruited etwork teachers are sigificatly more expesive tha local recruits, due to their terms ad coditios ad expese of their relocatio. They are also a prime professioal resource, updatig ad refreshig stadards aroud the etwork The Coucil faces a key decisio i decidig how best to expad its teacher capacity. Historically it has braded itself o the basis that it employs qualified teachers for whom Eglish is their first laguage; ad i 2007 some 96 per cet of teachers met this criterio. I practice, the Coucil caot meet demad everywhere through this source aloe ad already employs teachers for whom Eglish is their secod laguage i some coutries. There is also evidece to suggest that secodlaguage speakers may be more suitable to teachig Eglish i some markets or studet groups. 13 Other providers of quality Eglish teachig, such as Iteratioal House ad Bell, also employ secod-laguage speakers as teachers. The Coucil ackowledges the case for chage ad i February 2008 declared a ew corporate policy for systematic use of such teachers. O the other had its ow research suggests resistace i some markets to tuitio from secod-laguage speakers whe premium prices are charged. Idetifyig more flexible busiess models 2.34 The British Coucil has idetified more flexible ways to deliver Eglish teachig across the etwork ad is developig the meas to do so. There are variats of the Coucil s stadard model, used successfully i parts of the etwork, which idicate the potetial to expad the busiess through partership. The Coucil s oversubscribed Madrid cetre has arragemets i place to deliver teachig i premises of local authorities, schools ad uiversities. I respose to a waitig list for youg learer Eglish, staff aalysed the home addresses of existig ad prospective studets ad cofirmed the viability of settig up a teachig cetre i a coveiet locatio, freeig capacity i the mai school. The teachig takes place i classrooms reted from schools, which though providig fewer facilities tha the Coucil s ow youg learer cetre, has bee readily accepted by the market. Similarly, the success of the Coucil s exams operatio i Chia is i part attributable to the Coucil s partership with the local examiatios authority ad the immediate access this gives to a pool of orgaisatios which provide local kowledge, premises, staff ad marketig Sice Jauary 2007, the Coucil have bee workig with exteral cosultats, KPMG, to idetify more flexible, lower-cost busiess models which could facilitate expasio i priority markets such as Idia ad Chia. The work has established a rage of optios which iclude operatig a tradig arm, affiliates, frachisig, parterships ad joit vetures. The Coucil is i the process of choosig which approaches to apply to particular markets. It is too soo to say if the ew models of teachig will be successful, but the approaches beig cosidered are similar to some demostrated to work by other successful competitors such as Iteratioal House or Bell The Coucil is developig ehaced commercial skills through recruitmet, traiig ad cosultacy support. The recruitmet of specialists i fiacial aalysis has improved the ability to cetrally perform margi aalysis of key products. 15 The Coucil has also iitiated a programme of traiig for teachig cetre staff to better idetify ad exploit marketig opportuities. Durig the work with KPMG, the Coucil placed key idividuals with the cosultats i order to develop better busiess aalysis skills. 12 We visited teachig cetres i New Delhi, Madrid (Adults), Madrid (Youg Learers), Hog Kog, Tripoli, Dubai, Dar Es Salaam ad Prague. These cetres accout for approximately 19 per cet of British Coucil studets ad 23 per cet of teachig icome. 13 The Coucil commissioed Eglish Next by David Graddol (2006), a expert i socio-liguistics. 14 The Examiatios operatio i Chia has 30 test cetres, deliverig over 100,000 exams. 15 Margi aalysis is a stadard busiess maagemet techique used to establish the relative profitability of a product. Typically this is doe by establishig the total icome from a particular product ad subtractig ay associated additioal costs. The techique helps maagers to uderstad the amout of reveue the product will cotribute to the fixed costs of operatig the busiess. This iformatio is used to iform decisios about whether to add or subtract a product, the umber of products eeded to be sold, or how to price a product or service. Achievig Impact 19

22 part two Competig fairly i the teachig market 2.37 The British Coucil aims to esure that it does ot compete ufairly, but there is scope for greater trasparecy to allay competitors cocers. Its Eglish laguage teachig operatio has high brad recogitio ad is widely perceived as a first port of call for prospective studets i may areas of the world, icludig i less developed coutries where major commercial competitors such as Iteratioal House ad Bell are ot preset. It also derives a real, if itagible, competitive advatage from beig associated with the Coucil s overall profile, derived i part from its grat-aided activities. This syergy acts both ways: grat-aided activities also beefit from the profile of the teachig operatio. I most coutries the laguage school ad grat-aided busiesses share premises Competitors have expressed cocers that the Coucil may be competig ufairly, ad that it exacerbates this perceptio through lack of trasparecy. Usually the Coucil prices at the top of local markets ad so does ot udercut competitors o price aloe. But areas where UK-based competitors expressed particular cocers to us were: How far the Coucil derives a cost advatage i particular coutries through its diplomatic ad charitable status, ad might use this to offer better terms ad coditios to attract good teachers ad cetre maagers, ad studets. Whether the Coucil s laguage busiesses pay a reasoable market rate for the premises they occupy. That the Coucil does ot discuss its itetios to ope or close cetres i particular coutries ad so eable the UK idustry to pla ratioally. Competitors felt that such discussio could be a pragmatic way to best promote the UK Eglish Laguage teachig idustry as a whole. The Coucil has told us that it is ameable to this if the dialogue ca be geuiely reciprocal. That some Coucil teachig cetres market to studets of competitors whe studets atted Coucil-ru examiatios, which i some coutries is a Coucil moopoly. The Coucil told us that it had received o complaits from competitors that idicated a problem i this area Competitors cocers over the Coucil s tax status should be addressed over time by a cotiuig programme to regularise its tax ad status i differet coutries. 16 The use of shared premises by teachig cetres comprises two mai issues. The Coucil has mechaisms to esure that the teachig cetres pay a fair share of premises costs, ad i cetres the NAO visited the attributio of costs appeared realistic. The Foreig ad Commowealth Office derives assurace from the cost attributio that public fuds are ot diverted to fee-chargig activities. The secod issue is that certai premises occupied by the Coucil are retaied o cocessioary terms, some o lad gifted by host govermets. The Coucil applies depreciatio costs to reflect its past capital ivestmet i premises, such as fit-out or coversio costs. But it does ot apply charges i lieu of market ret to occupiers, to reflect the market value of such properties The eed for publicly fuded bodies to demostrate that they do ot compete ufairly with commercial competitors is ot limited to the British Coucil. Like the Coucil, the BBC operates commercial as well as grat-fuded activities ad has to provide assurace that public moey ad licece fee icome are ot diverted to commercial purposes. The BBC World Service, also fuded by the Foreig ad Commowealth Office to promote UK public diplomacy, complies with the BBC s arragemets, which are more complex ad structured tha those withi the Coucil. The mai features are: detailed supplier agreemets to esure that those parts of the BBC that supply services, facilities or programmig to etworks such as the World Service charge appropriately; traiig of staff o fair tradig priciples; ad a goverace structure for fair tradig matters oversee by a Board sub-committee; separate accoutig for commercial activities, with a certificate by the Exteral Auditor that there is o material cross-subsidy of commercial activities out of public fuds; ad provisio to receive complaits ad appeals by competitors claimig a grievace. 16 I the separate Olie report o support services, paragraphs at 20 Achievig Impact

23 part two 2.41 A key part of the ratioale for the Coucil beig i the laguage teachig busiess is that it eables it to make a stroger cotributio to developig the teachig of Eglish i primary, secodary ad higher educatio, ad so fosterig liks betwee the UK ad academic istitutios i each coutry. The Coucil has may examples of this syergy, which is clearly highly valued by foreig govermets ad authorities, ad ca yield high impact (Figure 10 provides a example from Spai). If better publicised, ad more widely replicated, such examples could defuse some of the cocers of stakeholders ad competitors. 10 Case study, Developig bi-ligual schools i Spai The British Coucil i Spai has sice 1940 operated a fee payig school i Madrid, which curretly has some 1900 maily Spaish studets o roll, aged from 3 to 18, ad is heavily oversubscribed. Durig the Fraco era the school provided educatio of a ethos ot available i the state sector. Its alumi iclude key figures i moder Spaish society. It is self-fiacig, ad makes a cotributio to Coucil cetral fuds. I the late 1990s the educatio miister of the federal Spaish Govermet requested the Coucil s help i adaptig the school s model of biligual ad bi-cultural Eglish ad Spaish educatio to some 46 state primary ad secodary schools i Madrid. The iitiative has sice grow to ecompass some 100 Miistry schools with 26,000 pupils, ad a further 180 schools ru by the devolved govermet of the Madrid regio. Due i part to strog paretal demad for tuitio i Eglish, it has proved robust to chages of political admiistratio. Other regioal admiistratios across Spai are at varyig stages of implemetatio. The first studets to joi the origial Madrid programme i primary school have ow progressed to the third year of their secodary schools, ad iitial evaluatio of studet attaimet idicates above average results. The Coucil s mai cotributio has bee through: Iput to the desig of the curriculum ad teachig methods. Teacher traiig, especially to improve Eglish, usig the Coucil teachig cetre. Recruitig i the UK some 500 teachers a year, (shortage of teachers beig the mai costrait o expasio). Settig up parterig arragemets betwee the UK ad Spaish schools. Costs to the Coucil have bee 465,000, additioal ivestmet i the schools by the Spaish authorities is estimated at over 33 millio. Source: Natioal Audit Office Achievig Impact 21

24 PART THREE Measurig Performace 3.1 This part of the report examies the desig of the British Coucil s curret performace measuremet system, how it operates i practice, ad the Coucil s plas to ehace it further i partership with its parters i UK public diplomacy. It also looks at how the Coucil ca better maximise its impact ad target its services (discussed i Part 1) through stroger mechaisms for maagig its relatioships ad iteractios with its customers. The Coucil has a strog culture of performace measuremet, ad is evolvig how it measures its impact. Measurig the impact of public diplomacy 3.2 Measurig the impact of public diplomacy activity is difficult ad complex. The iteded outcomes, such as icreased uderstadig ad stregtheed relatioships may oly emerge after may years. The British Coucil s measuremet system must rely o the assumptio that if it performs well i its observable, measurable activities, such as its Eglish laguage teachig ad its cultural ad scietific evets, the there will be a positive impact o public diplomacy i the loger term. Public diplomacy ca be iflueced by may exteral political, social ad ecoomic factors, ad the Coucil works alogside other UK agecies such as the Foreig ad Commowealth Office ad the BBC World Service, which also ifluece foreig perceptios of the UK. To demostrate its ow impact, the Coucil s measuremet system eeds to separate its ow actios from these various exteral factors. For the performace measuremet system to be useful there eeds to be a logical coectio betwee the activities beig carried out ad the iteded outcomes. 3.3 The British Coucil s existig performace measuremet system is a bechmark for the Foreig ad Commowealth Office ad for its iteratioal equivalets. It has draw o a wide variety of performace measuremet expertise, both iteral ad exteral, to develop a sophisticated ad comprehesive measuremet system. It is based o a two-stage approach to measuremet which reflects the iheret difficulties of measurig public diplomacy. It measures the immediate volumes, impact ad customer satisfactio of its idividual services ad activities, which are reported iterally through quarterly scorecards (see Figure 11). Ad it supplemets these measures i most coutries with periodic i-depth iterviews of existig customers, kow as Evaluatios of Log Term Outcomes. The Foreig ad Commowealth Office has draw o the Coucil s experiece ad kowledge to develop its ow approach to measuremet, while the Coucil s iteratioal equivalets such as Germay s Goethe Istitut ackowledges the Coucil as leadig i this field. 3.4 Performace data features promietly i the Coucil s Aual Report ad other accoutability documets. 17 The curret system for measurig impact represets a sigificat ivestmet of resources, ad is primarily based o questioaires to the Coucil s customers. I aroud 215,000 resposes were collected ad processed. Because the Coucil does ot routiely record staff time, there is o accurate figure for the extet of this commitmet, but we estimate that supportig ad maagig the system globally requires i the order of full time equivalet staff, equivalet to about oe per cet of complemet, across the busiess. Natioal Audit Office iterviews of staff i the coutries it visited idicated a rage betwee half of oe full time equivalet i small coutries ad, up to 1.5 equivalets i a large coutry operatio to collect, collate ad aalyse this data. 17 Improvemets i the Coucil s Aual Report for were welcomed by the Foreig Affairs Select Committee: It is apparet that a real effort has bee made this year to explai the methodologies ad mechaisms the British Coucil uses for measurig performace: this has bee doe throughout the report very clearly. Eighth Report, Foreig Affairs Select Committee, Sessio AcHIEvING ImPAcT

25 part three The British Coucil s corporate scorecard 3.5 The Coucil s performace scorecard for shows positive results across most aspects of activity, icludig audiece sizes, customer satisfactio scores, ad the perceptios of stakeholders ad parters, (Figure 12 o pages 24 ad 25). Most measures show a upward tred compared to the previous year. Highlights icluded the doublig of the idirect/website audiece, maily through egagemet with parter websites i Chia. Other key positive results icluded impact ad perceptio scores cosistetly i the rage, meaig that o average customers agreed that the Coucil was makig a differece. UK Ambassadors ad High Commissioers expressed similarly positive views of the Coucil s cotributio i their coutries. There are some egatives: otably customer service scores, though up o the previous year, are lower tha the Coucil would like them to be (see paragraphs o Customer Service Excellece). The scope of the curret measuremet system 3.6 The British Coucil s system esures that it is measurig all the key elemets of its work. The Scorecard applies a commo approach to each of the British Coucil s mai busiesses, icludig its reveuegeeratig teachig ad examiatios work ad its grat-fuded cultural, scietific ad goverace projects. The system uses a appropriate rage of measures to assess performace across five high level perspectives: impact; reputatio ad satisfactio; audiece size; maagemet results; ad leadership (see Figure 12). This eables maagemet to take a broad view of performace. Stability of measures is valuable i eablig performace over time to be iterpreted. The overall compositio of the Coucil s Scorecard has remaied relatively stable i recet years, though staff co-ordiatig coutry-level scorecards express cocers over cotiued chages to how idividual measures are defied ad operated, such as o media coverage of Coucil activity ad the coutig of idirect T3 audieces. 3.7 The Coucil also uses qualitative data, i the form of quotes from customer iterviews, to supplemet its quatified customer survey results. These iterviews are udertake by idepedet reviewers, though i practice Coucil staff have a role i selectig iterviewees ad sometimes also atted the iterviews. Iterview reports are a mix of maily positive but also some egative feedback. It is positive material that teds to be reflected i coutry ad regioal performace scorecards, reported to the corporate cetre ad used i published documets. The Coucil s Aual Report refers to particular Public Diplomacy challeges, ad performace scores that are below target, though qualitative citatios oly ted to reflect positive customer experieces. 11 The Coucil s system traslates customer resposes to a rage of questios about impact ad customer satisfactio ito quatified scores Category example questios ad statemets example scores 1 Impact a Takig part i this programme has broadeed my kowledge of Strogly agree = 100 other coutries ad cultures. b The UK values its relatios with your coutry. Neither agree or disagree = 50 Average impact score a + b 75 Customer satisfactio c How would you rate the quality of service you received? Good = 75 d Whether customers perceive the British Coucil as creative, up-to-date, Disagree = 25 a leader i its fields, ad forward-lookig. Average customer satisfactio score c + d 50 Source: Natioal Audit Office NOTE 1 The respose for each questio is coverted ito a score usig a five-poit scale of: 0, 25, 50, 75 or 100 ragig from strogly egative to strogly positive. The fial scores for impact ad customer satisfactio that are reported through the scorecard ad Aual Report are the average score for all the questios i each category, aggregated from all customer resposes. Achievig Impact 23

26 part three 12 Overview of mai elemets of the British Coucil s Performace scorecard Perspectives Impact Reputatio ad satisfactio Headlie Outcomes Idex of those who felt the Coucil had stregtheed their ties with the UK (74) [Where100 meas very sigificat beeficial chage ad 75 meas sigificat beeficial chage] 75 per cet of FCO Heads of Post strogly agree that BC provided good value for moey 54 per cet believe Coucil very effective i makig a impact 1 Idex of UK stakeholder satisfactio (77 i ) [Where 100 meas very satisfied ad 50 is either satisfied or dissatisfied] Corporate Outputs Idex results were all betwee 75 ad 80: (where100 meas perceptios of the UK much improved ad 75 meas improved (Figure 11) Overall customer satisfactio idex of 80 i [where100 is maximum very satisfied ad 50 is either satisfied or dissatisfied] Data sources Evaluatios of log term outcomes 1,204 detailed iterviews Aual Survey 2007 Resposes from 76 FCO heads of missio Iterviews with UK Stakeholders Questioaires to customers of projects ad services Source: Natioal Audit Office NOTES 1 A further 38 per cet of FCO respodets cosidered the Coucil effective. 2 The leadership idex is a composite of coutry/uk departmet level scores for three questios: The maagemet team ruig my coutry commuicate a clear visio of where the British Coucil is goig: 52 The maagemet team ruig my coutry perform effectively: 60 The maagemet team ruig my coutry will deliver a successful log-term future for the British Coucil: Achievig Impact

27 part three Balaced Scorecard Audieces Maagemet Results Leadership Audiece i direct cotact with Coucil 16.5 millio (15.1 millio i ) ad remote audiece (via website/broadcast etc), 86 millio Expediture i was maaged to withi 99.9 per cet of grat-i-aid Idex of staff views of leadership i the Coucil 56 i [where 100 meas very effective ad 50 is either effective or ieffective] 2 Coucil audiece statistics compiled from evets ad services Audited Fiacial Statemets ad systems British Coucil Aual Staff survey 2 Achievig Impact 25

28 part three 3.8 The Scorecard system is applied i all 110 coutries where the Coucil operates. Regioalisatio has provided a stroger basis for aalysis, as the 12 regios ca review ad compare regioal performace i greater detail tha the Corporate cetre could previously for the etire etwork. Whe combied with the improved reportig capabilities of the ew Fiace ad Busiess System, this has allowed the Coucil to move from aual to quarterly performace reviews, thus eablig maagemet to react faster to treds. The scorecard is gradually becomig a more effective decisio-makig tool at coutry ad regioal level. As staff i coutry ad regioal offices become more familiar with the performace measures ad what they mea, they are better able to use the iformatio to focus their efforts ad maximise impact. Some maagers, such as those i the East ad West Africa regio, have used the scorecard extesively. 3.9 Iterpretig regioal ad coutry-level comparisos of performace ca still be problematic due to differet operatig cotexts. Eve withi Idia, the Coucil has foud differig levels of customer approval towards the same product delivered i the same way, reflectig the differet busiess cultures ad social behaviours i orther ad souther regios. I this cotext, aalysig treds i scores over time becomes more importat. Data collectio ad aalysis 3.10 The system s data collectio ad aalysis processes make the curret performace idicators for customer satisfactio ad impact less clearly robust. The Coucil s key performace measures for customer satisfactio ad for assessig impact, (how far its services have made a differece to its audieces), are derived from customer questioaires. 18 Local staff are ecouraged to esure they receive sufficiet completed questioaires to support valid results, but i practice respose rates are highly variable. Each questioaire respose couts equally, ad low respose rates from large evets or audieces are ot give additioal weightig to reflect the evets greater size or importace. For example, i Idia, the results from the Coucil s largest customer base, Eglish examiees, were far outweighed i the scorecard by feedback from the similarly umerous library users. I Spai Arts evets attracted much lower respose rates tha from attedees of Arts evets i other coutries, ad from customers of laguage teachig i Spai. Typically up to half the evets or services for which the Coucil records a audiece do ot have questioaires issued, where local staff cosider that these do ot led themselves to feedback through such methods. 19 There are istaces i parts of the etwork where coutry staff have iovated to mitigate this problem, for example i Libya with the use of a more user-friedly credit-card sized feedback form, writte i Arabic. It is difficult to coclude how much the results would be chaged by higher respose rates ad by weightig to reflect audiece size. Customer results ted to be fairly cosistet betwee evets, so overall corporate scores for the etire Coucil might be expected to remai similar, though there may be more volatility at coutry or service level Approaches to custody of customer feedback data vary. Normally, retured questioaires are collected by the orgaizer or maager of the relevat Coucil evet. Ad i some coutries the results are collated by them too, prior to reportig the results for icorporatio i the Coutry scorecard. I Libya, the Coucil ow takes additioal steps to esure the itegrity of the data through use of a locked ballot box, opeed oly by staff uivolved i the delivery of the evet or service. It is difficult to coclude how far improvemets i the separatio of duties i collatig customer data would result i differet scores util this is more widely applied across the Coucil etwork. Developig ew measures 3.12 New arragemets curretly beig developed should help the British Coucil ad its Public Diplomacy parters to better measure the impact of their activities. I his 2005 report, Lord Carter of Coles idetified the eed to measure UK Public Diplomacy as a coheret whole, ad recommeded that the Foreig ad Commowealth Office, British Coucil ad BBC World Service work together to develop a stadard approach to measurig Public Diplomacy activities. 20 I 2006, cosultats workig for the Foreig ad Commowealth Office aalysed each parter s existig measuremet arragemets ad idetified the ecessary chages to better alig them. 18 I this cotext, customer refers to ay idividual with whom the Coucil has iteracted directly, through its project ad evets work as well as its Eglish ad examiatios busiess. 19 Commo reasos advaced for o-use of questioaires iclude short duratio evets or performaces, difficulty i issuig questioaires at public gatherigs, or usuitability of such formats for evets ivolvig very seior people. 20 Para 8.1, Public Diplomacy Review, Lord Carter of Coles, 13 December At preset, there is o stadardised system for moitorig ad evaluatig the success of public diplomacy as a whole, which makes it difficult to determie whether collective efforts are deliverig value for moey, or whether overarchig public diplomacy objectives have bee met. While acceptig the limitatios of wider public research o assessig log-term behavioural chage, it was felt that more could be doe i this area. 26 Achievig Impact

29 part three 3.13 The British Coucil has developed the cosultats proposals through a revised system which stregthes the lik betwee Coucil activities ad outcomes, ad the UK s iteratioal strategic priorities (see Figure 13). It has already used this facility to halt projects it cosidered would ot cotribute sufficietly. For example, i 2007 the Coucil iitiated a project etitled Coversatios iteded to facilitate dialogue betwee ext geeratio leaders i Europe o various issues aroud Islam, migratio ad security. It was termiated i 2008 because it could ot demostrate how it would cotribute to the Coucil s iteded outcomes, ad to value for moey A summary of chages i the ew system, ad their ratioale, is at Appedix 4. The British Coucil ad the Foreig ad Commowealth Office bega pilotig the ew system o ie Public Diplomacy projects across eight coutries i April 2007 ad are due to complete the pilot process i March The Coucil has committed a total of 3 millio to the pilots which icludes the operatioal costs of the projects as well as the costs of the ew measuremet tools with the associated costs shared evely betwee the two parters. The Coucil is cosiderig the costs ad beefits of rollig out the ew system. The costs of the ew measuremet tools were iteded to be offset by removal of the old oes. However, pilotig has show some of the tools to be cosiderably more expesive. The cost of the Ifluecer Tracker, which requires a specialist, locally egaged cosultacy to coduct iterviews with key stakeholders, has varied from 15,000 i Pakista to 30,000 i Caada. The Media Tracker, which uses a locally appoited cosultacy to moitor how themes idetified i the Coucil s strategy are reported i the media, is quoted as costig aroud 40,000 durig the pilot phase, i which it is trackig three themes across oly eight coutries. The Coucil realises it would ot be cost-effective to employ each of these tools for every programme or service it offers. Aother factor is that the Foreig ad Commowealth Office Embassies ad High Commissios are ot staffed i all coutries at a level that would eable them to participate actively i joit workig o public diplomacy with the Coucil. 13 The ew system allows the British Coucil to better demostrate how its iputs ad activities cotribute towards iteratioal strategic priorities Old system New system UK iteratioal priorities British Coucil purpose UK iteratioal priorities British Coucil purpose Programme areas Corporate outputs Corporate outcomes Itermediate outcomes Outputs Outputs Iputs Iputs Source: Natioal Audit Office aalysis of the British Coucil s revised system 21 Brazil, Caada, Chia, Idia, Jorda, Nigeria, Pakista ad Turkey. Achievig Impact 27

30 part three Customer Relatioship Maagemet 3.15 The British Coucil caot best target its services ad maximise its impact without stroger mechaisms for maagig customer relatioships. The British Coucil curretly holds over five millio cotact records i more tha 60 disparate techical systems throughout the orgaisatio. Microsoft Outlook is the mai system used by the overseas etwork to maage customer cotacts, although sector teams ofte hold their ow cotact details i various Excel databases, busiess card catalogues or other systems. We foud that coutry cotact databases cotaied outdated iformatio, duplicate cotacts ad had icosistet levels of detail. Some coutries are goig through a data-cleasig exercise to update their customer records, though this depeds o local priorities The variety of Customer Relatioship Maagemet systems i place throughout the etwork meas that the Coucil curretly caot cosistetly: accurately cout the umber ad types of relatioships it has with its customers; moitor how well it maages ad develops those relatioships; track its customer cotacts over time or see whe ad who last had cotact with idividuals; aalyse its relatioships to set targets; use the data to target marketig materials at the most appropriate cotacts; ad measure its performace i cultivatig, maitaiig ad developig those relatioships, icludig cross-sellig betwee its teachig operatio ad other services. The Coucil s ability to make best use of its customer kowledge i all its offices is therefore costraied Work to develop the British Coucil s approach to Customer Relatioship Maagemet is i its early stages. Without a global system, the British Coucil caot always idetify gaps ad opportuities i its reach ad product offers ad could be missig opportuities to expad the busiess. To address these weakesses the Coucil bega a Customer Relatioship Maagemet scopig project i Jue The aim of the project is to develop a orgaisatio-wide relatioship maagemet approach to improve the customer experiece; ehace the Coucil s uderstadig of their customers; ad to save resources by timely ad targeted marketig ad commuicatios. The Coucil has so far spet 300,000 but has ot yet idetified a clear solutio, although useful tools have bee desiged, ad successfully piloted i South East Europe, Wester Europe ad North America A proof of cocept pilot is curretly uderway i the Coucil s Chia Regio. The pilot is based o regioal requiremets for profilig ad trackig T3 audieces, but its experiece will iform the corporate way forward. It is curretly ruig some 14 moths behid schedule, with the build, migrate ad test phase expected to be completed i A pilot T1 ad T2 relatioship maagemet iitiative has also bee prioritised i the UK ad West Europe for If adopted as the global solutio, these pilots could allow Coucil operatios to more easily share ad search customers iteractio histories importat whe projects icreasigly cut across atioal boudaries. The mai risks to the project are that user take-up may be slow ad the completeess ad quality of iformatio fed ito it. There is also the risk that if the Coucil does ot soo defie a corporate solutio, Regios will develop their ow ad hoc itermediate solutios, which could prove difficult to itegrate ad would duplicate developmet effort. Customer Service stadards 3.19 A British Coucil-commissioed study i July 2007 foud that the most importat driver of customer perceptio of the UK is service delivery, whether its customers are fee-payig Eglish laguage studets ad exam cadidates, or audieces for grat-fuded cultural ad educatioal activities. Patchy Customer Service stadards are beig addressed. The Coucil has idetified its performace i customer services as a area it eeds to improve: Mystery shoppig research carried out i 2004 o the Coucil s telephoe ad equiry hadlig i all regios, icludig the UK showed high levels of icosistecy i quality of service both betwee ad withi coutries ad regios. Performace scorecard data showed a sigificat declie i overall levels of satisfactio i , but have sice partly recovered to a idex score of 80, (where 75 is good ). A baselie study of the Coucil carried out by Machester Busiess School i 2005 idetified a overall lack of stadards ad guidelies for customer service, ad that over 65 per cet of Coucil staff felt that they did ot have ay customers. The Coucil has sice itroduced a set of stadards ad guidace o its dedicated Customer Service itraet pages ad has implemeted a series of iitiatives to give rise to a more customer-focused culture. For example the Coucil ra a series of evets to promote good customer service durig , ad there is ow a global etwork of customer service champios with 275 members. 28 Achievig Impact

31 part three Research i 2006 showed a sigificat declie i customer service stadards across all Regios except Chia. I 2004 the Coucil had failed to respod to over 500,000 telephoe or equiries, which, by 2006 had rise to over 1.5 millio equiries. I 2007, the Coucil started to place additioal emphasis o marketig ad customer service, which became oe of the geeric skills agaist which staff are assessed ad recruited The Coucil itroduced a corporate Customer Service Excellece project i The overall objectives of the project were to icrease: customer satisfactio levels; the umbers of customers served ad relatioships built; the validatio of the Coucil s work through exteral quality assurace; ad both reveue ad impact through efficiet maagemet of relatioships ad resources. The project was iitially budgeted at 2.5 millio, excludig overseas staff costs. It was scheduled for completio by the ed of March Expediture up to March 2008 was 1.2 millio, ad the projected completio date is ow March Some coutries ad regios have bee puttig i place Customer Service Excellece projects as part of their Regioal Chage Programmes. Progress has bee variable ad half of the twelve regios had ot produced a project pla by December This was largely due to competig priorities, such as the eed to focus o other chage programmes ad the implemetatio of the ew FABS resource maagemet system. 14 East ad West Africa Regio: Tazaia Customer Service Excellece Project The East ad West Africa regio had the worst mystery shoppig results from the Coucil etwork (results were ot broke dow by coutry); Research foud that over 100,000 equiries per year were lost or ot resolved. I February 2006, the Regio made Customer Service Excellece oe of its six Regioal Key Challeges. By October 2007, British Coucil Tazaia had implemeted; a sigle equiry poit for customers; a separate phoe poit; a drive to get better FAQ scripts i place; ad a sigle maager for the frot desk. It also itroduced more discussios with staff about the Coucil s purposes ad stadards, so that all staff uderstad the busiess eeds ad equiry poit staff ca be rotated. A Customer Service Excellece health-check, carried out i September 2007 ad based o a template drafted i Idia, idetified that Tazaia was meetig 14 out of 18 good practice criteria for frotlie services ad 4 out of 7 for telephoe cotact. Three poits of excellece were idetified. However, Tazaia did ot meet ay of the te criteria for geeral customer care. Results of the 2008 Mystery Shoppig Exercise show that East ad West Africa has see sigificat icreases i customer satisfactio o 2006; however satisfactio is ot yet back to 2004 levels, ad it raks 11th out of 12 British Coucil Regios for satisfactio i call hadlig. Source: Natioal Audit Office 3.22 There are early idicatios of improvemet i satisfactio with customer service sice the Coucil s iitiatives bega. The Coucil s aual staff surveys have show a gradual icrease i the umber of staff who feel that they are regularly ecouraged to look for ew ways of improvig services to customers ad cliets from 66 per cet i 2005 to 72 per cet i There have also bee some successes i the regios (Figure 14). However, the Coucil is ot o track to meet the project s origial service improvemet targets. Istead, the project s target to achieve 95 per cet customer satisfactio ratigs has bee replaced by a performace scorecard target of per cet. Moreover, while the project s target is based o high volume geeral equiries ad iteractios relatig to specific services (usually with T3 cotacts), the corporate performace scorecard target for customer satisfactio also icludes feedback from participats at specific Coucil evets (ofte T2 cotacts). Global Mystery Shoppig exercises are ow coducted aually. From April 2008, the results will be icluded i quarterly Scorecard returs which will allow the Coucil to systematically assess corporate ad regioal treds ad to measure the success of the project so far. Achievig Impact 29

32 Appedix Oe Detailed recommedatios Curret positio The Coucil does ot yet fully uderstad the implicatios of its move from local to regioal projects, or the savigs geerated through beefits of scale. It ow iteds to move to eve larger, global projects from April Detailed Recommedatio The Coucil should verify whether, o average, large scale projects have geerated greater outcomes at least i proportio to their greater cost. Measures may iclude direct audiece size per 1,000 spet, customer satisfactio scores ad the ratio of grat to exteral fudig. Parameters for evaluatio should iclude; staff time ad cost, ad the elapsed time for project delivery; the balace of iteral ad exteral fudig; variatio i customer impact ad satisfactio scores; actual audiece reached versus the audiece expected; ratios betwee the audiece size achieved ad the Coucil s ivestmet. Expected beefits A deeper uderstadig of the effects of the move to regioal projects will allow the Coucil to better implemet the ext trasitio to global projects. With fewer, larger projects across the etwork, pickig the right global products will be essetial. I the trasitio to large scale projects, Coucil regios have bee able to commissio projects i differet ways ad have achieved differet rates of progress. This, coupled with the challeges of staffig ad coordiatig large multi-coutry projects, has tested the Coucil s overall programme ad project maagemet. The corporate commissioig process has ot bee fully itegrated ito project iitiatio i all regios. This has weakeed cetral oversight of the programme, ad made it harder to share good practice. Iteratioal workig, withi ad betwee regios ad betwee regios ad the UK, is far more complex tha the previous local approach, ad has raised ew challeges of staffig ad co-ordiatio. I itroducig its ew process to commissio large scale projects, the Coucil should raise the cosistecy of project maagemet i the UK ad across the overseas etwork. Chage should iclude better mechaisms for poolig successful project desigs, tighter cotrols o project fudig ad improved traiig for project maagemet staff. The ew process should; set clearer criteria as to what project plas ad moitorig iformatio project teams should submit at each stage i the project lifecycle; defie clearer lies of resposibility ad accoutability, for example settig out roles for the project ower, project maager ad coutry project teams, especially regardig resposibility for idetifyig parters ad securig exteral fudig; itroduce a global staff plaig tool to balace projects demad for project maagers, developers ad deliverers with their availability; esure that fudig is ot released oto regioal budgets util the Commissioig Office has reviewed the proposal, ad the project has bee formally approved; roll out cosistet project maagemet traiig for all key persoel ivolved i large scale projects; ad itroduce a slimmed dow project plaig process for local projects which esures adherece to good project maagemet practice ad corporate priorities, but maitais flexibility to rapidly deliver projects tailored to local eeds. More cosistet stadards of project maagemet, withi a cosistetly applied commissioig process, will eable quicker ad more efficiet roll out of large scale projects. Clearer oversight of all large scale projects by the Commissioig Support Office will eable successful projects to be more easily idetified ad project templates developed which ca be rolled out to more tha oe regio. 30 achievig impact

33 appedix oe Curret positio cotiued Detailed Recommedatio cotiued Expected beefits cotiued The Coucil icreasigly depeds o cotributios from exteral parters ad commercial sposors to help it expad its activities ad broade its impacts. Exteral fudig from parters ad sposors has declied sice 2001 ad there are large variatios betwee coutries; half of the etwork geerates almost all the Coucil s exteral cotributios. The Coucil has ot yet tapped the full potetial of corporate sposorship from the UK Headquarters of UK Multiatioals, where most marketig resources ted to be retaied. The Coucil should cofirm the reasos behid acute variatios i exteral fudig betwee coutries, ad more cosistetly apply its policy o workig with private compaies across its etwork. We recommed a corporate target to at least restore exteral fudig to 2001 levels (equivalet to 16 per cet of total Coucil resources). The Coucil should apply clear guidelies o workig with the private sector; for example the pre-coditios for workig with eergy compaies o climate chage iitiatives. Clarifyig project owership as part of a revised Commissioig process (above) will assist project teams make early decisios o whether to pursue sposorship ad participatio at the global, regioal, or local level, or a combiatio of these. Coutry operatios with very high sposorship rates are usig iovative ad proactive practices to icrease sposorship which could be applied elsewhere. Scope to exted egagemet globally with compaies that are suitable parters or sposors. A expasio of the Coucil s small Lodo-based Commercial Busiess Parterships team, tied to a miimum 4:1 earigs to costs target, should pay divideds. The Coucil does ot cosistetly aalyse the profitability of its teachig cetres ad products i sufficiet detail, holdig back its ability to desig ad deliver products that better reach target audieces ad fit market demad. The Coucil should more cosistetly embed the applicatio of commercial skills ad behaviours, for example margi aalysis ad price sesitivity, across its Eglish ad Exams busiess ad better use these to develop its offer; Exploit the compatibilities of FABS to carry out aalysis o profitability at a cetral level, ad for idividual teachig cetres to support decisios o commissioig ad decommissioig products. For example, through margi aalysis ad cotributio per studet/product. Eable better targeted product offer ad provide more detailed explaatio for variaces across the etwork. Allow the Coucil to better demostrate the fiacial ad o-fiacial beefits of its Eglish laguage teachig operatios. at local level, margi aalysis should be used to develop a better product offer fitted to the local market, based o local demad ascertaied through better market research, ad ew products developed where ecessary; at a UK Corporate level, a better uderstadig of market demad ad relative profitability should be used to help UK staff commissio the developmet of products which better reach target audieces; Recogise that o-target audieces should be pursued where they use surplus teacher or classroom capacity ad do ot displace priority activities, but still geerate a fiacial cotributio. achievig impact 31

34 appedix oe Curret positio cotiued Detailed Recommedatio cotiued Expected beefits cotiued The Coucil delivers high quality services i Eglish laguage teachig, but premium pricig, teachig cetre locatios ad capital costraits severely limit its reach. More flexible models of delivery have bee developed, but have ot yet bee applied across the Coucil s etwork, e.g. the use of parter premises to meet the demad of oversubscribed cetres i Madrid. The Coucil should pursue a target of deliverig a substatial proportio, (provisioally at least oe third) of its direct Eglish tuitio, i parter premises. The Coucil should roll out its pla for Idia ad Chia as soo as practical, ad cotiue to develop the ew models approach i existig markets such as East Asia ad Wester Europe. The Coucil should broade its o-lie offer to icrease the amout of iteractio with customers. Icrease the diversity of its teachig staff beyod First Laguage Eglish speakers to meet demad ad eable the Coucil to recruit locally. Examie more flexible models for locatig Eglish teachig cetres. Icrease its ability to develop ew busiess opportuities i existig operatios through traiig ad additioal staff capacity, especially i key markets. The Coucil has idetified a umber of ways of expadig the reach of its Eglish teachig ad exams operatios. But it eeds to demostrate more clearly to its stakeholders ad competitors how growth supports the Coucil s missio ad charitable purposes ad that it does ot represet ufair competitio. The Coucil ca draw o methods used by, amogst others, the BBC, to give added assurace o fair competitio. The Coucil should cosider fair competitio mechaisms of the type used by the BBC, ad adapt these for its ow circumstaces. Also The Coucil should track ad report explicitly o how it deploys its surplus geerated by its Eglish teachig ad exams cetres to cotribute to its wider objectives. By better makig the case for expasio, the Coucil should mitigate iteral ad exteral oppositio ad so better implemet its strategy. It should also highlight cases where its teachig cetres support grat-fuded projects. The Coucil should develop a more ope dialogue with private sector UK orgaisatios ad explore ways to co-operate i developig overseas markets. This will also require geuie reciprocatio from the private sector. The Coucil could make use of otioal rets to improve decisio makig i teachig cetres where premises costs are below market rets. The stadard of customer service by the Coucil is a key driver affectig perceptio of the UK. The Coucil is icreasigly recogisig the importace of good customer service. However it has ot yet met all of its Customer Service Excellece improvemet targets. Its lack of a corporate Customer Relatioship maagemet tool meas that the Coucil caot make best use of its extesive cotact etwork. Across its etwork it has made variable progress i defiig ad aalysig its audieces i order to best target its fiite resources. The Coucil eeds to build o its growig customerfocused culture I particular, the Coucil should develop a agreed specificatio for a commo customer relatioship maagemet tool, to eable it to track customer cotacts ad better uderstad its audieces across its etire busiess. Emphasis should be placed o; makig sure that all staff kow who their customers are ad develop a customer service ethos; extedig its use of audiece segmetatio ad market research to better target its products ad services across its worldwide etwork; developig a corporate solutio to maage customer cotacts, drawig o lessos leared i Chia ad other pilot coutries. At a miimum, a CRM system should allow the Coucil to: a Record the umber ad types of relatioships it has with its customers; By improvig the iformatio it holds o its customers ad better defiig its audiece groups, the Coucil could maximise the use of its resources ad desig its products ad services based o customer eeds. A more sophisticated customer cotact database is also essetial for the Coucil to cross-sell differet products, to market them, ad to track log term impacts. 32 achievig impact

35 appedix oe Curret positio cotiued Detailed Recommedatio cotiued Expected beefits cotiued b c d e f g h Moitor how well it maages ad develops those relatioships; Track its customer cotacts over time; Aalyse its relatioships to set targets; Use the data to target marketig materials at the most appropriate cotacts; Measure its performace i cultivatig, maitaiig ad developig those relatioships; Lik i with Teachig cetre resources to capture T3s; Readily exchage data with UK parters i coutry, pricipally FCO, DFID ad UKTI; makig best use of ew IT techology to deliver customer focused services, such as through Web 2.0 chaels ad wider availability of olie studet registratio ad paymet. The Coucil s coutry ad regioal performace scorecards provide a comprehesive overview of the orgaisatio s performace. However, the Coucil teds to cocetrate its reportig o positive customer commets, despite feedback from customers usually revealig a mix of maily positive but also some egative experieces. The Coucil ca improve the way it collects ad collates data o how its customers perceive its performace, through relatively simple chages to its processes: The Coucil should report a balace of positive ad egative customer commets i its coutry ad regioal scorecard reports, i order to promote trasparecy ad to better idetify areas for improvemet from a wider rage of sources. Recogise i the calculatios the relative size ad importace of differet audiece groups whe reportig customer satisfactio ad impact results. [Where this is likely to have a sigificat effect o the results]. More cosistet questioig of Coutry teams reasos for il or low customer respose to questioaires. This should feed ito guidace to teams o what evets should or should ot be recorded, ad o techiques to raise respose rates. Demostratig through secure custody of customer questioaires that feedback is hadled i a idepedet fashio to prevet coflicts of iterest. The Coucil s curret performace measuremet tools already make up a sophisticated system. However improvig the collectio of data would give the performace idicators more credibility ad authority i decisio makig. The Coucil is movig to a ew performace measuremet system to better measure the impact of its work o meetig public diplomacy objectives. Its pilot of the system has demostrated that it is more costly tha the old system, ad it is ulikely to be cost effective to apply all of its elemets worldwide. The Coucil ad the Foreig ad Commowealth Office should implemet lessos from their pilots i a clearly defied ew system which applies some measures globally ad others oly i selected projects ad regios. Highlightig the beefits of the ew tools, as experieced i the pilot coutries, to get buy-i from the relevat staff i the remaiig coutries. Usig the iformatio more cosistetly i all coutries to target projects at the poorest performig areas, where they ca have the greatest impact. Uderstadig the costs of the ew system, ad the aticipated beefits, will help the Coucil to get the best value for moey from its performace measuremet system. achievig impact 33

36 Appedix two British Coucil Resources 15 The chagig geographical allocatio of British Coucil resources British Coucil Regios et movemet m m m m West Europe & Americas North & Cetral Europe East Asia Russia Lati America South East Europe Chia & Hog Kog Idia & Sri Laka Souther Africa East & West Africa Middle East Near East & North Africa Cetral & Souther Asia Total Source: British Coucil 34 achievig impact

37 Appedix three Product areas for Eglish teachig ad exams Adult Learers Geeral Eglish laguage teachig from begier level to advaced. Course material varies, but is based o core textbooks, also used by other providers The mai exams product is IELTS, a examiatio typically sat by cadidates to idicate their level of Eglish whe applyig for uiversity. IELTS is joitly owed by the Coucil, Cambridge Exams ad IDP, the Australia equivalet of the British Coucil i terms of educatio promotio ad Eglish testig. Joit owership has resulted i the Coucil gaiig a higher proportio of icome for each IELTS exam sat tha its other products. As importat, IELTS is thought to be crucial i gaiig access to oe of the Coucil s key T3 audieces ad helps facilitate overseas studets studyig at higher educatio istitutios i the Uited Kigdom. Adult learers also sit Cambridge Eglish laguage proficiecy exams. Youg Learers Geeral Eglish courses from very youg learers to secodary school age. Course material varies, but is based o core textbooks, also used by other providers. The mai exams offered are Cambridge Eglish laguage proficiecy exams ad GCE exams; for example Iteratioal GCSE/A level or equivalets. Professioal Learers Busiess Eglish courses for corporate cliets ad the admiistratio of exams o behalf of professioal bodies such as accoutacy qualificatios. The Coucil feels offerig these services gives access to a key target audiece who may well rise to positios of ifluece. Teacher developmet Courses to teachers of Eglish as a foreig laguage employed by the educatio departmets of overseas Govermets. This could iclude improvig Eglish levels or givig traiig i teachig methodologies (Figure 12 Madrid Bi-ligual schools). I partership with Iteratioal House UK, the Coucil also helps provide traiig to private teachers of Eglish, ad ideed the Coucil s ow teachig staff, by offerig a distace DELTA qualificatio. The Coucil admiisters the HORNBY scholarship scheme, a fully parter fuded scheme where o-uited Kigdom teachers are brought to the UK for traiig ad developmet. Peacekeepig Eglish Eglish laguage teachig for peacekeepers, this activity is fuded by Departmet for Iteratioal Developmet, Foreig ad Commowealth Office ad Miistry of Defece. Curretly ogoig i 25 coutries. Eglish Laguage Quality Services I partership with Educatio UK, the Coucil is resposible for admiisterig a OFSTED approved accreditatio scheme for Eglish laguage teachig istitutios i the Uited Kigdom. While icome from this scheme is egligible, its importace is set to icrease uder ew immigratio legislatio where oly accredited istitutios will be able to sposor studets visas. Eglish websites Free o-lie resources, curretly through te pricipal websites for teachers ad studets of Eglish. Over a millio visitors per moth view over 3 millio pages. Over 1.6 millio lesso plas are dowloaded by Eglish teachers ad used i classrooms aroud the world by approximately 48 millio learers every year. achievig impact 35

38 Appedix four The British Coucil s ew performace measuremet tools The British Coucil ad Foreig ad Commowealth Office are curretly pilotig a umber of ew performace measuremet tools. Tool Ifluecer tracker Cocrete chages tracker Media tracker Descriptio This is a successor to the Evaluatio of Log Term Outcomes. It ivolves i-depth iterviews with the ifluecer commuities idetified i the strategies. This is a ew tool for capturig the verifiable chages that have occurred, through systematic arrative feedback. This will track shifts i the way that themes (programme areas) idetified i project strategies are reported i the media. This tracks outcomes at a very high level, ad will operate i additio to the curret media moitorig which is coducted to assess the impact of idividual projects. Added beefit It assesses the opiios of all the key ifluecers, ot just those directly egaged by the Coucil. These ifluecers are selected i advace of each project by a expert committee, ad so esure a more objective sample of iterviewees. As well as measurig success i achievig itermediate outcomes, it should help the Coucil to demostrate its impacts more readily to its stakeholders. Because the media plays a key role i directig as well as reflectig public opiio, this will provide valuable data o how successful the Coucil has bee, ad where more work eeds to be doe at a strategic, rather tha just a operatioal, level. The measuremet system is desiged to alig with the Coucil s Corporate Outcomes. Iter-cultural dialogue Stregthe uderstadig ad levels of trust betwee people i the UK ad other societies Stregthe the cosesus for rejectig extremism i all its forms Icrease the ability of idividuals ad orgaisatios to cotribute to positive social chage ad the stregtheig of civil society Icrease the use of Eglish as a tool for iteratioal commuicatio ad itercultural uderstadig UK creative ad kowledge ecoomy Icrease the value to the UK of its share of the market for iteratioal educatio Ehace the UK s reputatio as a source of expertise ad a parter for skills developmet, icludig i the teachig ad learig of Eglish Stregthe the iteratioal profile ad egagemet of the UK s creative sector Icrease the UK s cotributio to iteratioal co-operatio i research ad iovatio Esure that every teacher ad learer of Eglish worldwide has access to quality laguage services from the UK Climate chage Icrease uderstadig of the case for tacklig climate chage Icrease support for the achievemet ad implemetatio of iteratioal agreemets that address the threats of climate chage Stregthe relatioships ad etworks which lead to actio o climate chage mitigatio ad adaptatio 36 achievig impact

39 Appedix five Study Methodology The study was desiged to address the key questio whether the British Coucil uses its resources ecoomically ad efficietly, ad adequately measures ad ehaces its impact i meetig public diplomacy objectives. 16 Overview of Methodology used for the study Key Support Services Customer-facig Activities (Part 1) Outcomes (Part 2) Chage Maagemet People Maagemet The Commercial Laguage Teachig ad Examiatios Busiess The curret system to measure the Coucil s activities ad impacts Iformatio Techology Fiacial Maagemet Procuremet Estates Maagemet Grat-fuded cultural ad educatioal activities Customer Service Excellece iitiatives ad Customer Relatioship Maagemet systems The Coucil s performace as show by its Scorecard Chages i progress to improve performace measuremet, (i cojuctio with other UK bodies ivolved i public diplomacy) Templates applyig performace criteria for Support Services, sourced maily from the Public Audit Forum. Semi-structured iterviews with support staff i coutry. O-lie cesus of Coucil staff as users of support services. Questioaires to the Coucil s most direct peers i Frace ad Germay. Validatio of results by NAO fiacial audit team for the Coucil. Iput from specialist private sector laguage teachig adviser. Semi-structured iterviews with teachig busiess staff i coutry, ad review of busiess data. Structured iterviews with key UK corporate stakeholders. Semi-structured iterviews with project delivery staff i coutry, ad review of project documetatio. Review of progress of customer service/ customer relatioship iitiatives. Mapped Coucil processes for opeig ad closig its cetres. Qualitative aalysis of o-users of Coucil services i Spai (IPSOS MORI). Questioaires to the Coucil s most direct peers i Frace ad Germay. Specialist expertise from the NAO s cross-govermet performace measuremet team. Use of the authoritative FABRIC criteria to assess Coucil performace measuremet & maagemet systems. Semi-structured iterviews with scorecard staff ad data users i coutry. Mapped mai i-coutry processes for collectig ad collatig scorecard data. Review of FCO/Coucil public diplomacy pilots i two coutries. Source: Natioal Audit Office achievig impact 37

40 appedix five Scopig To coduct a comprehesive examiatio of a complete orgaisatio s ecoomy, efficiecy ad effectiveess is a uusual ad exactig challege for ay Natioal Audit Office study. To refie the uusually broad scope, we applied the NAO s Efficiecy Toolkit model (Figure 17) to idetify areas of the Coucil s busiess to help target our work to best effect. The toolkit provided the overall coceptual framework, to balace the study betwee eabler services, customer facig systems ad fuctios, ad outcomes. Study scopig ad plaig also took ito accout the ature of parliametary ad public iterest i the Coucil, fiacial materiality, areas of corporate risk ad chage, ad issues emergig from two prelimiary visits to Coucil operatios i the Czech Republic ad the Uited Arab Emirates. Durig these visits, we met with a variety of Coucil staff from across their busiess sectors, icludig Eglish ad Exams, Arts, Sciece, Educatio, Goverace, Corporate Services, ad projects teams. We also met with key stakeholders, both from other UK Departmets ad represetatives from cultural ad govermet istitutios of the host coutry. 17 The Natioal Audit Office Efficiecy Model Study Methods The pricipal study methods were as follows. Visits to Coucil offices The study team visited Coucil operatios i eight coutries coverig seve of the 12 Regios, as well as visits to the Lodo ad Machester offices. The offices visited, ad the Regio they fall ito, are listed i Figure 18 below. Together they represeted 14 per cet of Coucil grat i aid expediture ad 39 per cet of teachig ad exams turover. Source: Natioal Audit Office 18 Offices ad Regios visited durig the fieldwork (prelimiary visits i italics) British Coucil Offices regio Visits were selected takig ito accout the followig mai criteria: Busiess performace, i terms of high or low customer scores or fiacial results. Operatios experiecig, or which had just udergoe, chage for example i terms of icreased or decreased resources, or implemetatio of ew systems or methods. Coverage of the Coucil s mai programme areas; itercultural dialogue, kowledge ad creative ecoomy, ad climate chage. Beijig, Chia Dar Es Salaam, Tazaia Dubai, Uited Arab Emirates Hog Kog Madrid, Spai New Delhi, Idia Prague, Czech Republic Tripoli, Libya Source: Natioal Audit Office chia (Regioal Office Beijig) East ad West Africa Middle East chia West Europe ad North America Idia ad Sri Laka (Regioal Office New Delhi) North ad Cetral Europe Near East ad North Africa 38 achievig impact

41 appedix five O-lie cesus ad self-assessmet template o Support Services We coducted a o-lie cesus of Coucil staff to gather their views o the performace of the support services (IT, Fiace ad Resource Maagemet, Huma Resources, Procuremet ad Estates) i eablig them to do their job. The cesus questios were based o value for moey idicators for each support service, developed by the Public Audit Forum, but tailored to best fit the Coucil s cotext. 22 The cesus was available o the Coucil s Itraet site durig October It received 1,245 resposes, some 16 per cet of the Coucil s total staff populatio. Detailed results are available olie at the NAO website together with the o-lie questioaire used. I additio to collatio of quatified results, the team also classified ad extracted valuable material from the free-text fields of cesus resposes. Where relevat, results were cross-referred to the results of the Coucil s ow staff surveys. The NAO also developed a assessmet template for each support service usig criteria draw from Public Audit Forum models, the NAO Efficiecy toolkit ad other sources. Templates were completed by the Coucil s Corporate teams for each support service, ad we used the fidigs to direct their future discussios ad equiries. The NAO team resposible for the fiacial audit of the Coucil also cotributed a validatio of the questioaire resposes drawig o their log-stadig kowledge of the orgaisatio. Semi-structured iterviews with UK stakeholders Semi-structured iterviews were udertake with the Coucil s stakeholders ad busiess parters i the UK. The Coucil s stakeholders were defied as: a b c Etities which provide grat-i-aid to the Coucil or otherwise support its core activities: broadly aki to shareholders. (e.g., the Foreig ad Commowealth Office). Key UK parters who ivest their participatio ad itellectual property rather tha their moey i the Coucil (e.g. The Examiatio boards with qualificatios i Eglish). Sposors who wat to elist the British Coucil s resources to meet their ow objectives, (e.g. UK Trade ad Idustry, the Arts Coucil, UK Sport). Qualitative aalysis of o-users of British Coucil services i Spai The Coucil measures the satisfactio ad perceptios of its active customers i over 100 coutries, however much less is kow about the attitudes ad perceptios withi the majority of its target audieces who have ot participated i its iitiatives or atteded its evets. We egaged IPSOS MORI to carry out closely targeted qualitative research o this group, focusig o o participats i the Coucil s grat-aided activities. For reasos of cost it was ot possible to udertake work i more tha oe coutry. IPSOS MORI carried out 12 i depth iterviews with seior represetatives from the Arts, Educatio, Sports, Sciece ad Busiess sectors i Spai. Spai was selected, i cosultatio with the Coucil, as a large ad importat operatio which delivered products across most of the Coucil s themes. For IPSOS MORI s full report, see the NAO website (Qualitative Research Amog No-Users i Spai) Examiatio of commercial practice ad outcomes i the British Coucil s Eglish laguage teachig ad examiatios busiess Richard Rosser, a former CEO of Bell Laguage Schools ad curretly Chief Executive of the Europea Associatio for Quality Laguage Services, advised our team o the detailed desig of our work ad helped us to iterpret our fidigs o the Coucil s laguage traiig busiess. We also deployed to this part of the study a NAO staff member who had i a previous career ru, ad taught i, private sector laguage schools i the Far East. Workig with Richard we developed a issue aalysis to provide a assessmet framework for the fiacial ad o-fiacial aspects of the busiess. The high level desig of the framework is at Figure 19 overleaf. Iteratioal Comparisos Our prelimiary work cofirmed that the British Coucil, due to its uusually wide remit, has few close comparators worldwide. Germay s Goethe Istitut ad the Alliace Fracaise are closest i terms of remit ad scale. Questios were put to these bodies o the scale of their operatios, the use or o-use of particular maagemet approaches, ad how they measure the success of their activities. Resposes were reflected i our work maily through triagulatio with British Coucil practices. Where relevat, results were cross-referred to the results of the Coucil s ow stakeholder surveys. 22 Value for Moey i Public Sector Corporate Services, Public Audit Forum, May achievig impact 39

42 appedix five 19 Key questios relatig to the British Coucil s Eglish ad Exams busiess Key Questio 1 Is the Eglish ad Exams busiess achievig its full commercial potetial? Sub questio level 1 Is the E&E busiess deliverig maximum surplus? Sub questio level 2 Is the Coucil able to operate wheever it is commercially advatageous? Does the Coucil have sufficiet strog kowledge of the local market to idetify ad seize opportuities? Does the Coucil utilise its existig resources to best effect? Does the Coucil uderstad the key drivers of each reveue stream ad associated costs? Does the Coucil maage ad protect the quality of the British Coucil brad? Does the Coucil perform regular quality assurace exercises o its products, teachig ad exams? Does the Coucil coduct regular aalysis o the icidece of repeat users of its products? Does the Coucil perform regular ad comprehesive aalysis o the quality ad success of competitors? 2 Is the Eglish ad Exams busiess maximisig its o-commercial impact? Does the Coucil maximise reach of its o-commercial audieces through E&E activities? Does the Coucil effectively target ad sustai relatioships with its T3 audieces through teachig activities? Is the Coucil effectively accessig, ifluecig ad sustaiig relatioships with its T1/2s? Does the Coucil maximise the cross-sellig potetial of Eglish ad Exams by icreasig target groups exposure to other UK (ot just British Coucil) products? Is the Coucil maximisig audiece exposure to its grat i aid activities? Is the Coucil maximisig exposure to other UK iterests/ stakeholders (e.g. higher educatio courses)? Source: Natioal Audit Office Mappig Key busiess decisio processes We carried out iterviews with staff i the Coucil s recetly established Commissioig ad Iovatio Support Office ad with project delivery staff from the overseas etwork. We also reviewed project documetatio to map the process for developig ad implemetig customer-facig projects. We also mapped the decisio makig process for opeig ad closig coutry offices ad teachig cetres. Use of the FABRIC framework to assess the British Coucil s performace measuremet ad maagemet systems The FABRIC framework is a methodology to assess the stregths ad weakesses of a performace iformatio system. It was produced joitly i the UK by the Natioal Audit Office, Audit Commissio, Office for Natioal Statistics, HM Treasury, ad the Cabiet Office. The acroym stads for Focused, Appropriate, Balaced, Robust, Itegrated ad Cost Effective. Detailed guidace ca be foud at documets/public_spedig_reportig/public_service_ performace/psp_fabric_checklist.cfm We also reviewed progress of the use of the ew Public Diplomacy measuremet system i two of the eight Public Diplomacy pilot coutries (Idia ad Chia). Status Review of the British Coucil s chage programmes Aalysis of the Project Iitiatio Documets, plus budgets, timetables ad status updates to map progress agaist the Coucil s Chage Programmes, icludig compoet projects uder the Overseas Chage Programme, for example Customer Service Excellece ad Customer Relatioship Maagemet. Prited i the UK for the Statioery Office Limited o behalf of the Cotroller of Her Majesty s Statioery Office / achievig impact

43 Desig ad Productio by NAO Marketig & Commuicatios Team DP Ref: 8351VE This report has bee prited o Cosort Royal Silk ad is produced from a combiatio of ECF (Elemetal Chlorie Free) ad TCF (Totally Chlorie Free) wood pulp that is fully recyclable ad sourced from carefully maaged ad reewed commercial forests. The rage is maufactured withi a mill which is registered uder the BS EN ISO 9001 accreditatio, which provides the highest stadard of quality assurace.

44 Published by TSO (The Statioery Office) ad available from: Olie Mail, Telephoe, Fax & TSO PO Box 29, Norwich, NR3 1GN Telephoe orders/geeral equiries: Order through the Parliametary Hotlie Lo-call Fax orders: [email protected] Textphoe TSO Shops 16 Arthur Street, Belfast BT1 4GD Fax Lothia Road, Ediburgh EH3 9AZ Fax The Parliametary Bookshop 12 Bridge Street, Parliamet Square, Lodo SW1A 2JX Telephoe orders/geeral equiries Fax Orders [email protected] Iteret bookshop.parliamet.uk ISBN TSO@Blackwell ad other Accredited Agets Achievig Impact A report by the Comptroller ad Auditor Geeral The Statioery Office