Futures Group Corporate Strategy Unlimited Possibilities

Transcription

1 Futures Group Corporate Strategy Unlimited Possibilities

2 Mission Unlocking potential in people of all ages. Future thinking, focused on leading change in careers, advice, skills and training. We exist to make a positive difference to people s lives by enabling them to realise their full potential in employment, education and training through increased confidence, awareness and skills. This builds on our strong history of twenty years as a social enterprise. Our name - Futures - represents both the prospects of the beneficiaries that we support and the nature of the activity that we deliver, with our approaches leading change in our sector. Vision To be a financially resilient social enterprise, defined by the exceptional quality of our people and our results, which change lives. We exist to make a positive difference to people s lives but need sustainable sources of income to achieve this goal as well as to be able to extend our support to over 100,000 people and businesses a year by This diverse range of income streams across the Group will enable investment in quality approaches in every area of our activity. We will invest in our people, our processes and systems to ensure that they enable the delivery of outstanding services. We will combine the strong focus on care for our beneficiaries with professionalism and efficiency. Values Our values have been shaped as guiding principles for our colleagues and align to our mission and vision. They are critical to our success and outline the approach that we will take with beneficiaries, clients, funders, partners and colleagues. They represent the organisation that we are currently but also the organisation that we want and need to become as well. They are: Passion and pride to make a difference the bedrock of our existence. We have high expectations of ourselves and the people that we support Learning culture we want to not only promote a learning culture amongst our beneficiaries but embrace this as an organisation and support our colleagues to learn and develop. We learn from others and our own experiences and share good practice. Visionary and innovative We influence others, plan for the future, create opportunities and use our skills and knowledge to grow the business. Our mission to lead change requires us to be outward looking, to innovate and try new approaches, this also requires us to be: Open to challenge, change and improvement a value that we want to exhibit both organisationally and individually. We recognise the potential in change, rise to challenge and seek opportunities to improve both individually and as an organisation. Supporting talent and developing potential both in the individual beneficiaries of our work and our colleagues. We will recognise and value talent within the organisation. Leading by example we are honest and behave in ways that inspire others internally and externally.

3 Strategic Objectives The four most significant objectives that will drive our activity over the next three years are as follows: To provide consistently high quality services. We can only make the difference to people s lives that we want to if our quality is outstanding. Our ground-breaking Ofsted rating for our National Careers Service delivery in the East Midlands, in 2017, is a proxy of this ambition and has established the benchmark for all other services, whether they are inspected by Ofsted or not. Where we are operating within an inspection framework, we require all services to be judged as either Good or Outstanding. Where we are not subject to inspection, we will benchmark our quality indicators against others to ensure that we are in the upper quartile of national performance. High quality delivery will go hand-in-hand with the focus on performance against targets set. To have a diverse and balanced portfolio of income streams, with no more than a third delivered through any single contract by The National Careers Service contracts that we hold currently account for just over half of our total income and this represents a risk to business. Through our target operating model and Group structure, we will build new services and income streams that align to the current delivery arrangements but which provide greater diversification and less reliance on a small number of major contracts. To enable this quality to be delivered and to achieve our diversification target, we need to have a scale of operations across the Group structure. Our target is to have grown to achieve positively affect the lives of 100,000 beneficiaries a year, with a 20m turnover by 2020/2021, from a position in 2018/19 of 16m. We will achieve this growth across the Group through a combination of successful contract awards, organic growth in Futures for Business driven primarily through sales activity, the development of charitable income streams and via appropriate acquisitions. To have pioneering, future-proof operating models of delivery. Whilst still relying heavily on the quality of our people to deliver services over the next three years, we will develop a broader range of delivery models during this time, ten percent of which will be digitally focused. We will need to invest in research and development to achieve this as well as in partnerships with a range of specialist organisations.

4 Target Operating Model Our target operating model outlines the approach that we have to business development and provides clarity over our intentions for the type and location of our delivery. We will deliver a range of services, supporting a spectrum of different beneficiaries. For the purpose of clarity in this target operating model, this continuum of needs has been divided into three different groups: Supporting vulnerable people with multiple and complex needs Engaging individuals for work Providing skills for work and employer support Our support for the most vulnerable people in society individuals with multiple and complex needs that require significant assistance is the starting point for this range of activity. These needs could be the result of a range of situations, including physical, mental and societal factors. Our work here will still be focused on employment and training outcomes but will recognise the range of issues that individuals encounter and the broad range of solutions required, with colleagues delivering these outcomes being trained accordingly. Our work in this area is likely to often be partnership based and undertaken in geographical areas where we have had a strong existing presence, particularly Nottingham and Nottinghamshire. We will grow areas of specialism within the general area of support for vulnerable people, notably in the connection between work and health (with a focus on learning disabilities, common mental health barriers and muscular-skeletal disorders), where our delivery will extend beyond these geographical borders. We will also develop our specialism in supporting young people with special educational needs and their families. We will build on the multi-agency family support activity that we undertake in partnership with Nottinghamshire County Council, supporting multiple and complex families of 8-18 year olds and explore such approaches with other councils as part of an extension of local authority based activity. We will further explore how we can support vulnerable people with a broader range of advice services, including support for financial inclusion activity. Our work for vulnerable people is likely to be funded through a combination of grants, contracts and social impact bonds. We will grow our social impact bond (SIB) income over the next three years to be the major education, skills and employment provider securing SIBs at a national level. Whilst most of our provision in this area will fall under the Futures for You brand, some of the Nottingham and Nottinghamshire based activity will also be delivered through the charity arm that we will have established by Over our twenty-year history, our strength as an organisation is primarily in the area of supporting individuals of all ages to make the right decisions about their career paths engaging individuals for work. Whether this relates to choices for young people in schools about their education and training options as part of our NEET reduction activity, or supporting adults into employment through our National Careers Service delivery; our model of employing highly skilled staff supported by a strong performance-management culture and enabled by labour market intelligence, meant that this work is a key strength. This was reflected in our ground-breaking Ofsted rating of Outstanding for National Careers Service delivery in We want to build upon these strong foundations by growing this delivery nationally. We plan to deliver Teckal based services to a further two local authorities by 2021, in addition to those already delivered to our owner councils in Nottingham and Nottinghamshire, and will cultivate relationships over the next two years to reach this position.

5 We will secure European Social Funding (and its successor fund, following Brexit) in areas where we have existing provision through the National Careers Service, primarily the East Midlands and East of England. We will also have started to develop provision to engage individuals for work in at least one major city (London, Birmingham or Manchester) by 2021, as a clear demonstration of our national intent. Our schools engagement strategy will be focused on the East Midlands and link with both our NEET provision as well as our growth in schools-based Apprenticeship delivery. We will be clearly recognised by all stakeholders within the sector as a leading organisation for our quality and level of innovation, with Futures for You as the predominant brand. The third strand within our continuum of support is the skills for work and employer support offer. This will be delivered through Futures for Business and will see the further expansion of our Apprenticeship offer, to the level where it will be a mid-sized training provider, generating 5m of income per year by We will offer Apprenticeship Standards in ten occupational areas and at levels ranging from 2 to 6. Our specialisms will centre on education and professional services and will be available to large and small employers. We will have strengthened our position through a small number of targeted acquisitions, focused on complementary sectors and the development of a commercial (non-public funded) offer as well as a greater focus on a digital offer. The majority of our delivery will be in the East Midlands although we will have areas of Apprenticeship provision also aligned to other delivery arrangements and will be starting to develop our schools offer on a national basis. We will be judged as being Good or Outstanding by Ofsted for this delivery and will have a reputation amongst our target employers as a values-led, high-quality provider. We will continue to operate our apprenticeship training agency, directly employing around one hundred apprentices on behalf of a range of host employers and will explore how this can also lead to the development of an employment agency style development. We will grow our Adult Education Budget provision to one of the largest allocations (for any independent training provider) in the East Midlands, also starting to operate in the East of England as well. The connection between the three strands of activity is an important facet of our target operating model. Whilst delivery activity may reside in different parts of the overall Group structure, the approach to both internal referrals and business development more generally will not sit within silos. Our aim is to have a strong, high quality offer that enables individuals to progress from being at the edge of work to enter work and then progress through the acquisition of new skills. This does not compromise the importance of impartial advice at every stage. We want to think about how we support individuals holistically in this way and also want to consider whole families too. The support that we offer to young people should be appropriately extended to their parents / carers, and vice versa. Inter-Group collaboration is a foundation for the success of the whole organisation in achieving our mission and we will invest considerable time and effort in pursuing it accordingly.

6 Brand positioning Our target audience is made up of three distinct groups. Commercial (funders): They are results driven and want to invest in an organisation that delivers tangible results (often locally). Commercial (clients and partner businesses): Looking to develop the skills and potential of their employees. Individual: They are determined, but need support in finding work and developing their true potential. They are looking for an organisation that can provide them with both professional and emotional support. For our commercial audience, the sector is in a difficult transition; now more than ever, people are looking for thought leaders to challenge and help them prepare for what is coming. For the individual, the job market is confusing, and with so much uncertainty, they are looking for someone who really cares to turn to for clear advice and guidance. Our unique selling proposition is that we are a future thinking careers, advice, skills and training organisation that helps people to challenge themselves and achieve more from life. Our straightforward, honest advice sets us apart from our competitors. Corporate Structure and Governance Our existing corporate structure has been founded on the needs of a single-mission, locally focused organisation that benefitted from secure annual funding. This situation has changed considerably over recent years and our corporate structure needs to reflect the reality of our current and future operating context, whilst recognising the critical role that our two owner councils (Nottinghamshire County Council and Nottingham City Council) play. The objectives for the development of our governance arrangements are: Maintaining current ownership by both councils and preserving Teckal status, enabling them to deliver services through Futures without the need for procurement, when appropriate. To formally separate impartial careers advice from skills delivery and the apprenticeship training agency. This is a statutory requirement of the apprenticeship training agency and good practice for the careers advice function to protect its impartiality. To insulate different structures within the Group from pressures and risks in others. Examples of potential issues could include those relating to quality and the historic pension deficit that sits with the existing Futures Company. To create an aligned charitable structure that is able to bid for a range of income unavailable to the rest of the Group structure. The proposed structure to affect this change and meet these objectives is outlined below. Recruitment of directors to these structures will take place during 2018/19.

7 Futures Group Holding Company Council owned, Ltd. By G tee Charitable Structure Futures Group Management Company Ltd. by shares Impact Apprenticeships ATA Ltd. by shares Futures for Business Training and skills delivery Ltd. by shares Futures Advice Existing company with contracts and liabilities Ltd. By G tee Nottingham and Nottinghamshire Youth Support Teckal Company Ltd. By G tee Branded as: Futures for Business Branded as: Futures for You

8 People Strategy The achievement of our mission and vision depends significantly on our people captured through the strapline of our associated strategy: we release the potential in our people to release the potential in others. The strategy sets out a plan of action over the next three years to meet the following objectives: Improve our leadership and management development, enabling our leaders to be coached and supported to grow in their roles and effectively manage their teams. Create a culture of organisational and people development throughout the company, with the right pipelines and arrangements in place to support succession planning across the Group. To develop an HR system and associated management information to enable us to track essential information in a compliant and intuitive way whilst managing our data in one place. To construct a reward policy that attracts and retains colleagues to enable us to have the right people in the right roles, with the right skills. To construct better people related processes, with well developed, modern policies, processes and tools that provide simpler working practices for managers. Colleagues will be employed in one of three of the companies outlined in the corporate structure chart above. Those staff involved in cross-company activity, including senior executives, finance, human resources, marketing, IT and management information, will be employed at the Futures Group management company level. Colleagues involved in delivering services to individuals, including the National Careers Service and NEET reduction activity, will be employed in Futures Advice. Colleagues delivering Apprenticeships, Adult Education Budget and other skills provision will be employed within Futures for Business.

9 Financial Strategy The financial objectives of the organisation are aligned to our wider business objectives over the next three years. These are as follows: Turnover targets Year Futures for You Futures for Business Charity Total 2018/19 14m 2m 0 16m 2019/20 14m 3.5m 0.3m 17.8m 2020/21 14m 5m 1m 20m Futures for You income will be static to take account of reducing income from both National Careers Service and local authority income sources. New business will have to be secured to remain static. Futures for Business revenue will increase in line with the projections in its business plan and will be derived through organic growth in Apprenticeship, Adult Education Budget and Apprenticeship Training Agency delivery. Whilst strategic acquisitions are a consideration as part of this strategic plan, the turnover that they will bring to the Group is not factored in at this stage. Charitable income will follow the creation of the charity structure in 2019/20. Surpluses and Contribution Levels The consolidated target for the Group is a net, pre-tax trading surplus of 3% per annum. This enables between 0.4m and 0.6m of working capital to be retained by the Group each year for the next three years, bolstering the reserves, further strengthening the liquidity of the organisation and providing some contingency. Contribution levels from subsidiaries to the management company will be set at 11% to cover all centrally apportioned overheads. Retention of surpluses within each subsidiary for reinvestment in product development will be agreed at the start of each business year between the management company and the leadership of each organisation.

10 No dividends will be paid from the Group to any external organisation, reflecting the limited by guarantee position. The return to both owner councils will continue to be made in the form of continued levels of efficiency and subsidy for local authority commissioned activity. Further returns for Nottingham and Nottinghamshire will also be generated through external funding applications centred on both local authority geographies, leveraging increased investment to the area. Pension treatment The target levels of net trading surplus will be insufficient to meet the predicted levels of annual adjustment (under IAS19 accounting practices) that are made for pension costs in the company s statutory accounts to derive a bottom-line surplus. To achieve such a figure would require annual surplus levels to be closer to 10% of the overall planned turnover. As this is unachievable and the pension deficit does not affect the Group s overall liquidity, it is accepted that the statutory accounts will show a loss for the next three years. The historic balance sheet liability that the company has as a result of its membership of the Nottinghamshire Local Government Pension Scheme (c 20m in 2018) is an issue that will remain for a considerable period of time and sits outside management control. This will be consolidated from Futures Advice to the Group Company but it is intended to enable Futures for Business to sit outside the admission agreement and therefore be insulated from the balance sheet liability as a stand-alone company. Treasury management The company/group reserves are held in a number of bank accounts, protecting the exposure to any significant risk with any single institution. Over the next three years the reserves are planned to grow by c 1m to 6m by 2020/21. This will represent a very high current ratio (current reserves to current liabilities) of 5:1, above the minimum level set of 3:1. It therefore affords the opportunity to be more ambitious in our treasury management approach, including investments. We will explore a range of options for this, including arrangements with both owner councils and will seek further advice and approval accordingly. Pay and conditions We have a clear aspiration, as part of our People Plan, to ensure that we appropriately reward, attract and retain colleagues. This is likely to increase our cost base over the next three years to be able to implement a combination of pay harmonisation (for TUPE transferred staff into Futures on lower salaries), cost of living increases and introduction of appropriate bonus arrangements. This will be considered for affordability on an annual basis, in line with the financial targets established in this plan being met. Capital expenditure Futures has comparatively little capital infrastructure compared to organisations of a similar size in other sectors but the purchase of our Maid Marian Way premises in 2018 has signalled an intent to support improvements to our physical environment, which we see continuing over the next three years. We also plan to increase our capital outlay on IT systems and infrastructure to support both our resilience and our ability to meet objective four of our plan.