2.0 Skills for Enterprise Development

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The Enterprise Strategy Group (ESG) envisaged a knowledge economy for Ireland’s future, focused on high value-added products and internationally traded services, and which relied on innovation as the primary engine of growth. In order to realise this vision, Irish enterprise needs to focus on developing two key capabilities:

These capabilities are inextricably linked, as innovation in products and services will only result in market success if they meet customers’ genuine needs. Sophisticated sales and marketing skills will thus be at a premium, not only to develop market intelligence, but also to communicate this knowledge effectively to the R&D function of the business.

The ESG also identified management capability as an essential ingredient for sustainable enterprises. It called on development agencies and enterprise firms to actively promote management development. Forfás and the Expert Group subsequently carried out more in-depth studies to understand the skills needs in these areas, each of which is summarised below.

2.0.1 Management Development

The Management Development study by the Expert Group focused on management development in the small-to-medium enterprise (SME) sector. It concluded that management development was a critical policy issue for Ireland, in particular in the non-internationally-traded sector for Ireland’s future development. The direct benefit of management development in the impetus it provides for the training of other employees has much wider consequential upskilling implications.

A central recommendation of this report was the establishment of an SME management development co-ordination committee or forum to maintain an on-going focus on the issue of management development in SMEs and to ensure coherence and coordination of all activity in the area36. This recommendation was subsequently endorsed by the Report of the Small Business Forum37.

2.0.2 Innovation, Marketing and Sales

Another report by the Expert Group highlighted the collective importance of innovation, marketing and sales capabilities for the future success of Irish exporting SMEs38. In particular, it stressed the importance of the interrelationship between these three business functions. Successful innovation will hinge on the ability of firms to utilise customer and market knowledge in the development of products and services which meet genuine customer needs.

The report identified an acute problem in relation to sales staff in SMEs recruited from technical backgrounds, who have inadequate, if any, formal training in sales. The report advocated greater provision of tailored (sector-specific and highly targeted) programmes by the training providers. The need for Higher Education Institutes to align their marketing and sales curricula closely to the needs of SMEs was also highlighted.

2.0.3 Languages for Enterprise

The Expert Group has also reported on the link between foreign language skills and enterprise development, and has highlighted the importance of foreign language skills for exporting indigenous firms and foreign-owned firms engaged in international service activities39.

International business relationships will be crucial to indigenous enterprise in the future. Success in marketing and selling Irish goods and services will be contingent on the ability of the indigenous sector to establish and maintain close relationships with customers in global markets. An exporter that can interact with potential customers in their native tongue will automatically have a competitive edge over one that cannot. This is crucial given that 75 percent of the world’s population do not speak any English and 94 percent do not speak it as their mother tongue.

Service transactions generally involve a high level of human interaction and therefore require sophisticated communication skills. The availability of an internal supply of foreign language skills will enhance the attractiveness of Ireland for foreign multi-nationals wishing to establish such activities here.

In its report the EGFSN also highlights the fact that the current profile of languages being studied in the public education system, which is dominated by French at post-primary level, has arisen in an ad hoc manner and owes more to historical factors than any analysis of the needs of learners and the State.

A key recommendation of the report was that a National Languages Policy should be formulated by the Department of Education & Science, in collaboration with the National Council for Curriculum and Assessment (NCCA), to provide an integrated and coherent approach to language education. The report also suggested that future policy on languages should take account of patterns of migration into Ireland. The pool of foreign language capability created by immigration should be recognised and utilised as a resource.

2.0.4 Building Research and Development Capability

In 2004, the Expert Group set out its findings in relation to the human capital requirements to support R&D in Ireland40. The projections in that report were considered as part of the development of the Strategy for Science, Technology and Innovation (2006) launched by the Government in June 200641. The Expert Group notes the key actions set out in the Strategy to build the human capital required to underpin world class research. These actions include:

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[36] Which would operate under the auspices of DETE and to include other relevant government departments and State agencies, representatives of SMEsand major providers of management development in Ireland.

[37] Report of the Small Business Forum, Small Business is Big Business, May 2006

[38] EGFSN, Innovate Market Sell, 2004

[39] EGFSN, Languages and Enterprise, 2005

[40] A Model to Predict the Supply and Demand for Researchers and Research Personnel in Line with Ireland’s Strategy for Contributing to the European Research Area 3% Initiative (September 2004)

[41] Strategy for Science, Technology and Innovation 2006-2013