Maximising social impact in the public sector

Whilst speaking with our customers and their suppliers, we’re having more conversations around social value – especially in the public sector.

But what does ‘social value’ truly mean and how can organisations build this into their procurement processes? This article offers a brief introduction.

What is social value?

“Social value is a broader understanding of value. It moves beyond using money as the main indicator of value, instead putting the emphasis on engaging people to understand the impact of decisions on their lives. The people’s perspective is critical.”  – Social Value UK

Social value is important because it recognises that there are wider benefits to society that go beyond financial impact and aims to create a positive impact for all stakeholders. It puts a focus on three key aspects:

1. Economic: employment opportunities, opening up apprenticeships and training.
2. Social: improving the health and well-being for local residents, addressing social exclusion and building stronger communities.
3. Environmental: reducing carbon emissions, focusing on climate change, increasing sustainability and promoting biodiversity.

Why is social value important for public sector organisations?

Public sector organisations have a responsibility to use public funds responsibly and social value is an important part of this responsibility. By creating social value within contracts, public sector organisations can ensure that their projects deliver wider benefits to society, rather than simply achieving the project’s objectives.

Secondly, organisations are accountable to the communities that they serve, and creating social value can help to increase community engagement and trust. A poll run by YouGov[1] found that 77% of people would like to see more business set up with a priority on using their profits and business operations to make a positive impact on the wider community.  With this in mind, if public sector organisations show they are creating social value, they are more likely to increase the buy-in from their residents.

With the introduction of the Social Value Act, organisations in the public sector are under increasing pressure to demonstrate the social impact of their project. The Procurement Policy Note (PPN) 06/20 issued by the government stated that public sector contracts must have a 10% weighting to the delivery of social value. Therefore, by requesting, measuring and reporting on social value, public sector organisations can demonstrate the wider benefits that their projects are delivering and can ensure that public funds are being used effectively.

The Social Value Model and how it helps public sector procurement teams

As public sector procurement teams are responsible for sourcing goods and services, focusing on social value provides them with a way of delivering better value for money by taking into account the wider social, economic and environmental benefits that suppliers can deliver. It can also help to create more collaborative and creative relationships with suppliers.

In December 2020, the government published the Social Value Model – a tool that can help procurement teams measure and maximise the social value of their projects. It helps public sector buyers shift their mindsets to ‘account for’ rather than ‘consider’ social value during the tendering process.

The Social Value Model provides a structured framework for procurement teams to think about how they can secure – and measure – wider social, economic and environmental benefits across the full procurement lifecycle.

More simply, the Model takes a four-stage approach to measuring and maximising the social value of their tenders:

1. Identify.
   This involves engaging with stakeholders and understanding their needs and priorities. The guide provides a useful framework across five key themes:
   ‣ COVID-19 recovery
   ‣ Tackling economic inequality
   ‣ Fighting climate change
   ‣ Equal opportunity
   ‣ Well-being
2. Plan.
   The guide offers a template to develop your social value plan, which includes sections on your priorities, the activities you will undertake to deliver them and the outcomes that are expected to be achieved.
3. Deliver.
   This involves working with stakeholders to deliver the activities outlined in the plan and monitoring progress against expected outcomes. The guide provides some useful tips for delivering social value, such as engaging with local suppliers and businesses, creating employment opportunities for local people and reducing carbon emissions.
4. Evaluate.
   The Social Value Model offers a framework that helps you to define, measure, value and report so you can analyse what has been achieved and assess whether the social value that was intended has been delivered.

How can eXceeding support public sector organisations to widen their social value impact?

eXceeding has a team of public sector procurement experts who can support you to deliver social value. In our experience, most public sector organisations focus on tackling economic inequality and fighting climate change, as these tend to be the easiest ones to measure and report back on. Our procurement experts can work with you to widen your social value impact, help you to identify the best suppliers for your needs and develop meaningful reporting tools to provide feedback to your stakeholders.

We recently held a series of short webinars dedicated to delivering social value through procurement, covering key themes such as:

• How to interpret the Social Value Model for your organisation;
• Considering social value during pre-procurement planning;
• Market engagement & selection of routes to market;
• Social value evaluation questions;
• Awarding and managing contracts to measure social value objectives.

Visit our webinars and events page to watch our recorded sessions.

Alternatively, if you’d like a more focused conversation about your specific needs, arrange a call with one of our public sector procurement experts.

[1] YouGov, Polling for Social Enterprise UK, 2019