Development of a Competency Framework for …

1 FINAL REPORT Development of a Competency Framework for Business Resource Efficiency A study to develop and test, using qualitative surveys, a Competency model for Business Resource Efficiency (BRE) and prepare a BRE Competency Framework relevant to SMEs Project code: FRA0035-094 Research date: Oct 2010-Mar 2011 Date: 21 March 2011 WRAP s vision is a world without waste, where resources are used sustainably. We work with businesses, individuals and communities to help them reap the benefits of reducing waste, developing sustainable products and using resources in an efficient way. Find out more at Document reference: [ WRAP, 2006, Report Name (WRAP Project TYR009-19. Report prepared , WRAP] Written by: Jayne Cox, Anthea Hawke, Keith Lawton, Daren Luscombe While we have tried to make sure this report is accurate, we cannot accept responsibility or be held legally responsible for any loss or damage arising out of or in connection with this information being inaccurate, incomplete or misleading.)

2 This material is copyrighted. You can copy it free of charge as long as the material is accurate and not used in a misleading context. You must identify the source of the material and acknowledge our copyright. You must not use material to endorse or suggest we have endorsed a commercial product or service. For more details please see our terms and conditions on our website at Development of a Competency Framework for Business Resource Efficiency 1 Executive summary Research overview WRAP has been tasked by Defra to deliver Business Resource Efficiency (BRE) by supporting resource efficiency amongst Small and Medium-sized Enterprises (SMEs). This research complements WRAP s existing knowledge and experience of working with SMEs and aims to help WRAP better understand the sectors and/or types of SME that will be more willing to act than others; to better understand SMEs generally; and to understand how different types of intervention will be more appropriate to different types of business.

3 The objectives for this work were to: Consider the types of resource efficient behaviours WRAP should seek to influence during their next business plan, and to establish a Framework of key competencies to benchmark progress. Develop a Competency Framework for resource efficiency for SMEs in the UK by parameters that may include sector, size and use of resources. Better understand the motivations and barriers for SMEs to act in a resource efficient way and in particular their levels of competence in respect of agreed resource efficient forms of behaviour. Develop a repeatable method of measuring behaviour change in SMEs (related to BRE) that includes, where possible, understanding of the links between behaviours and outcomes.

4 Entec and Brook Lyndhurst carried out the following primary and secondary research from October 2010 to March 2011 to meet these objectives: A review of secondary evidence sources; Development of an outline Competency model for resource efficiency for SMEs; Original primary research (in depth interviews in two phases) to test the initial Framework and to cognitively test questions; and Producing a finalised Competency Framework . The initial research plan included an optional quantitative survey with approximately 2,000 SMEs, subject to the findings of the qualitative research. A second phase of in-depth interviews was proposed as a better alternative, as few of the businesses in the first phase of in depth interviews demonstrated higher levels of BRE capability that would enable segmentation through quantitative analysis.

5 Developing a Competency model A focused literature review was carried out to identify the characteristics, skills, resources, and other factors that may influence resource efficiency in SMEs. A conceptual Framework was developed to help frame the many different types of factors considered, these being grouped into four different types; ethos; governance; skills and resources; and fixed characteristics such as size and location. The evidence review identified a long list of characteristics and competencies that may be important for BRE, from which a core set of BRE competencies were defined. This Competency model and SMEs wider understanding of BRE - was tested through in-depth interviews with 43 SMEs, across a range of sizes and sectors.

6 Development of a Competency Framework for Business Resource Efficiency 2 The extent to which SMEs displayed different BRE competencies was assessed using a qualitative scoring system. This scoring had some significant limitations, but some interesting trends and differences within the sample of SMEs were found. The three main groups of competencies that emerged were those that were: Found across the majority of businesses, regardless of their overall level of competence; Only demonstrated by businesses with higher overall levels of competence; and Not demonstrated by the SMEs interviewed, or were only shown by a very small number of businesses. The Competency Framework is shown below, using the following key to summarise these three groups: Bold text - commonly found entry level competencies Normal text - advanced level competencies found in SMEs with higher BRE capability Greyed text - competencies shown by few or no SMEs Figure 1.

7 SME resource efficiency Competency Framework Behaviour change dimension Organisational norms (acceptance of importance) Commitment (willingness to change) Action (ability to change) Know-how (self-efficacy/capability) Ethos Governance Practice Skills & resources Headline Competency Recognises environmental impacts of business Has an operational business strategy with defined accountabilities Integrates BRE into business strategy Has awareness of gaps in knowledge regarding BRE Supporting Competency Recognises the importance of individual action on BRE Encourages and empowers staff to improve BRE performance Links BRE with business performance Has a system in place for managing business activities (E,H&S) Uses BRE information to support decision-making Works with supply-chain to identify and implement opportunities for BRE Measures & monitors use of resources Has in-house expertise on BRE Collateral Competency Has a participatory management structure Has values and attitudes that consider the environment to be important Staff roles, responsibilities & accountability relating to or influencing BRE are clearly defined and regularly reviewed Actively seeks feedback on performance from supply-chain BRE and/or env t considerations integrated into procurement processes Has means of accessing external information.

8 Know-how & support Organisation understands how to optimise process and/or equipment performance Staff appropriately trained in BRE The research suggests that the size, age and sector of a SME influences its overall BRE competence, although this is based only on the small sample of SMEs interviewed for this research. For non-service based SMEs in manufacturing, construction, printing and utilities, SMEs with over 50 staff became increasingly competent, although this pattern was not found for SMEs in the service sector, where increasing size did not affect overall levels of Development of a Competency Framework for Business Resource Efficiency 3 Competency . Non-service based SMEs, such as manufacturing and construction, which had been in operation for less than 20 years were much more likely to have low BRE capability.

9 Almost all of the service- based SMEs interviewed were less than 20 years old, and there was no trend linking age and BRE capability. The trends identified in this research suggest that engaging younger manufacturers, those that have been in operation for less than 20 years, could have high potential for improving BRE. Green investment loans, or other start up finance or Development loans could include requirements for BRE activities. Key findings How SMEs think about BRE There isn t a tangible area that BRE covers; rather it is a set of distributed skills and practices that are covered by different areas of business management. SMEs did not tend to think about BRE issues as a distinct area to be managed, but instead framed them in one or more of the following ways, as either: Being integrated with health and safety issues.

10 Common sense and part of an overall internal or wider societal culture and way of doing things rather than business practice. Integrated into process efficiency, and making best use of resources through efficient work scheduling, processes and product design. Different types of SMEs tended to conceptualise BRE in different ways. SMEs don t need to be environmental leaders or even very interested in the environment to do BRE. They are waste watchers not positive greens . SMEs are generally committed to using resources well, but this is not usually driven by environmental concerns and the two are often thought of separately. Resource management is often linked to cost saving rather than environmental impact, and even businesses that have an ethical view that saving resources is important may not necessarily hold pro-environmental values.