Last week, we broke down the basics of what to expect from the upcoming changes to the government’s procurement process. With the new year will come an even more targeted, socially valuable, inclusive approach to the awarding of government contracts.
With social value weighting to be set at a minimum of 10% of a supplier’s final score, the hope is that this shifted perspective will become a key differentiating factor in determining who wins public contracts. On a larger scale, the changes exist to encourage diversity in the suppliers chosen, while prioritising social good as highly as value for money and quality of work.
So, now you know what changes are on the horizon, how can you start to prepare? We have put together our top tips for both procurement teams looking to integrate the new guidelines seamlessly into their existing processes and for businesses looking to hit the ground running when it comes to competing for upcoming contracts.
Whether you are a procurement team for a local authority or a supplier looking to compete, our biggest piece of advice is to start preparations for the changes early.
In terms of procurement teams…
Procurement teams should be looking to streamline their procurement process prior to January 1st. Creating a professional, reliable process now means you are ready once the guidelines are live.
The changes hope to open government projects up to even more businesses, levelling the playing field between SMEs, social enterprises, and larger organisations. The expectation is there will be a marked increase in the number of bids made for each project, and you need to be prepared for this rise.
As well as this, the changes encourage suppliers to take their social value more seriously. And, as such, we should expect more sophisticated and ambitious social value commitments from all suppliers moving forward. So take the time to anticipate any problems you might encounter should the measuring and comparing of social value commitments demand more complexity and nuance from your process.
Consider all the ins and outs of what these changes mean for your procurement processes. This way, new priorities and systems can be embedded into the entire process come January 1st.
In terms of suppliers…
As we have mentioned, these changing regulations seek to level the playing field for all businesses, encouraging businesses of all sizes to compete for the £49bn spent on public contracts each year.
As a supplier, it will pay to gather the full picture of your social value as it is right now. Knowing where you are starting from will prove imperative for developing and growing your impact alongside the changes.
Figure out how you can display all your current initiatives in tender responses and recognise the most efficient and effective areas of development. Look for the places where you can go one step further in generating social value in one of the core themes set out by the government’s PPN 06/20.
For smaller businesses looking to take advantage of the 10% weighting given to social value, the more you can do now to prepare initiatives, strategies, and explore the resources at your disposal, the quicker you can start competing for contracts once the changes are in place.
Another change to the procurement process will be a requirement for suppliers to prove they are paying their own suppliers on time. All businesses competing for contracts will have to “demonstrate they have paid their own suppliers in accordance with contractual terms and also that they are paying 95% of invoices within 60 days”.
Communication, communication, communication
This advice works both ways; for procurement teams and suppliers alike. If procurement teams start consulting with their supplier base early on – for example, now – everyone can get on the same page quicker. Come the new year, government procurement can seamlessly transition alongside the new regulations.
Consulting every step of the way starting before procurement actually begins, enables procurement teams to lay out all their expectations and share what measures and values suppliers will be compared against. On the part of suppliers, this valuable consulting time provides them the insight and opportunity to strengthen their social value offering, tailoring their initiatives and strategies to better suit all the new expectations and requirements.
Communication, communication, communication
Existing procurement processes can be arduous. As a procurement team, while you probably have an existing procurement management system, the social value aspect largely still consists of text boxes, manual processes, and spreadsheets.
As it is, extracting information from text boxes misses out on the ability to compare pledges in any standardised way. And it tends to focus exclusively on the quantity of value commitments, as opposed to quality.
Luckily, there are tools out there that provide you with a simple, standardised approach to measuring, evaluating, and comparing the social value commitments or bidders. Tools that feed back into your wider procurement system and can work alongside whichever frameworks or measurement standards you already use.
By doing your research early, you can source an efficient system that works best for you and ensure your team is comfortable and confident using it. You don’t want to be rushing around looking for a tool, while also trying to come to terms with the new regulations, when January rolls around.
The right tools can put social value measurement on autopilot. Not only speeding up your current processes, but making adapting to the upcoming changes a seamless transition.
Hopefully, between last week’s introduction to the changes and this week’s advice, you are feeling more prepared and confident. Next week, we will be back to explore why accountability and tracking social value throughout an entire project life cycle will help procurement teams maximise the social value of every project.
Impact lets project and procurement teams maximise social value from every project and tender. Working alongside your existing procurement systems, we make it simple to visualise, measure, and compare bidders’ suitability in terms of social value. If you are interested in finding out more, get in touch today on 0161 532 4752.