Maximising social value through your procurement
In this blog post, Catherine Manning, Membership and Networks Manager, explores how you can take steps to maximise the social value you can create through your procurement.
What is social value?
Social value is the relative importance that people place on economic, environmental and social changes they experience in their lives. Changes in people’s lives are outcomes that are created, both good and bad, through the activities that we do. We can work to increase the good changes and decrease the bad changes.
How can you positively impact social value?
Measuring the impact and changes being made from current activity, through involving the stakeholders experiencing the change, will give you a baseline for your current social value. This information can then be used to look at the most effective ways to make positive changes.
How can you report on social value?
At Social Value UK (SVUK) we advocate a principle based framework to account for social value, with the long-term aim to change the way social value is accounted for in procurement through the principles, practice, people and power model.
Using these principles you can begin to ask the right questions to understand the impact you already have. More importantly for commissioning, they will help you understand the impact that you want to have.
Why include social value in procurement?
Goods and services that affect people’s lives are procured on a daily basis. Resources are allocated to activities that create and destroy social value every day. The aim is to maximise the positive outcomes, whilst minimising the negative outcomes from any procured activity.
How can you change things?
Identify the right outcomes for a framework by asking the right questions, to the right people, at the right time, during the procurement process. It is clearly more difficult to maximise social value the further away you are from the people experiencing the change, because of the separation of the service and impact. But it is not impossible.
Key questions to consider include:
How much social value are you creating already?
It is difficult to know whether it could be higher if you don’t know what you are already creating. Start with a baseline.
Is the value additional, or is it embedded into the service itself?
Crown Commercial Service’s (CCS) offers will already have an impact on amounts of social value delivered, with key elements already built and scope for more to be delivered, depending on your commissioning choices.
Did anyone else contribute to creating the social value?
You should consider this as part of the design process. Suppliers should review it as part of their service delivery.
What would have happened anyway?
It is difficult to maximise your impact if some of what you claim as social value, would have happened anyway. You can monitor overall change by encouraging suppliers to engage their user groups.
What is the relative importance of the outcomes?
Without considering the relative importance to the beneficiary or customer experiencing the change it will be very difficult to design and deliver procurements that maximise social value. You can consider this as part of a needs assessment. Suppliers can use this to improve their services and evidence how they are doing this.
Who answers these questions?
This is key as it is difficult to maximise social value if those affected aren’t involved in telling you what the outcomes are for them.
How can you support suppliers in achieving the outcomes with the most value?
To achieve the desired outcomes, we must all work together. Some actions you can take to support your suppliers include:
Hold pre-market discussions – have open conversations with potential suppliers and CCS to better understand what social value can be provided. Use this to inform your procurement.
- Build social value into your contract registers – supply the right information, and give enough time for planning and creation of partnerships, systems etc.
- Deliver training for local businesses – help them to respond meaningfully. Use local business connections (e.g. Chambers of Commerce) throughout the process.
- Have clear, enforceable criteria with weighting – do your systems and documents include social value? Can you enforce what you’re asking for?
- Ask the right questions – by using the principles model you and your suppliers will have the framework for measuring, managing and maximising the social value you create.
- Encourage innovation – expect your suppliers to change and develop the services they provide, and build this into the service lifecycle. Be careful to avoid stifling innovation through over-specifying how to deliver the contract; getting feedback from users on regular basis will provide opportunities to innovate.
This is a learning process. The point of measuring social value is to understand your current social value and improve your services over time, increasing your net positive social value.
This can only be done through partnership working, collaborating with your suppliers and service users. Use tools and resources that already exist to help you. We are all on a journey to create the most social value for our society; we do not need to do it alone.
This blog was originally published for the Crown Commercial Service.