techUK is the trade association that brings together digital tech firms and people, particularly to work with government in terms of regulation, policy and effective practice around technology. Clearly, public procurement features heavily in the agenda given the many, many billions spent every year by the public sector in this area.
The organisation has just published a very worthwhile and interesting report, titled Improving social value in technology procurement. The background is this - “techUK's Public Services Board, consisting of senior executives from a diverse range of tech suppliers, commissioned Henham Strategy to undertake both quantitative and qualitative analysis of over 100 techUK members active in the public sector market”.
The report is supportive of the aims of social value and indeed a “Social Value Committee” has been formed recently, including techUK members and relevant Cabinet Office colleagues in a working group. However, the report does raise criticisms of how social value is currently applied in UK public sector procurement, particularly in central government.
As it says, “With nearly three years of the social value model being delivered in practice, there is a consensus from techUK members that social value is not being delivered in the way it should, nor in the way it was intended”.
That is strong stuff from a group that wants to stay on the right side of government! The five bullet points in the report’s “Introduction” give a decent summary of the key issues.
· Communication from government needs to improve – before, during and after contracts are awarded.
· There needs to be a more strategic discussion with the sector to improve how social value is delivered.
· There is a lack of consistency in social value approach within Whitehall, and there is a lack of capability amongst those responsible for delivering social value.
· There is no clear or available data on how much the technology sector spends in delivering social value requirements, nor any published assessment of the impact of suppliers’ social value commitments.
· Scrutiny of social value is difficult, at best
The recommendations range from the obvious (removing Covid-19 recovery as a key theme in social value considerations) to the reasonable but a little nebulous (“Enhancing industry stakeholder engagement through more consistent and collaborative interactions”) and then some suggestions that are sensible but require some commitment and work from the government side. Those ideas include a full National Audit Office evaluation of the social value model, an annual report from every government organisation on social value achievements, and a social value “playbook” to be developed by government and industry. (That could follow other well-received Commercial Playbooks we have seen from Cabinet Office, for example covering sourcing, construction and digital).
It is also clear from the report that smaller firms are unsurprisingly struggling more than larger to understand what they should be doing and to put together convincing social value proposals. It’s been a fear of mine for years now that we might accidentally make life harder for the very firms we want to encourage as suppliers – small, young, innovative, maybe minority owned – because of the very sustainability and purpose objectives that we want to follow. We must make sure we aren’t just building more barriers to entry that the IBMs and Capitas can hurdle easily whilst start-ups stumble.
The report also includes an interesting analysis of how firms look at social value requirements in tenders. Are they adapting their CSR strategies to simply to ‘tick a box’ when responding to opportunities? Or are they responding to the policy and aligning their CSR efforts positively, to deliver societal benefits, as an active strategic choice. Or are businesses, and particularly SMEs, responding to opportunities on a bid by bid basis simply to get through the procurement process, but without making any real change to their overall CSR strategy? That is a fundamental question in terms of the long-term effectiveness of the whole social value approach.
There are also some brief international comparisons in the report, along with a useful checklist aimed at tech buyers. All in all, the report is well worth a read and actually is also relevant for private sector firms that are applying sustainability / purpose factors in supplier selection and evaluation processes. Many of the issues facing government buyers are also present in the private sector, including that point about barriers to entry, so private sector buyers should also have a look at this.