Is the use of SME’s the best way to maximise social value?

This is clearly correct, but does the use of smaller organisations reduce the ability to deliver large scale, integrated offers on issues such as training and community engagement? Can smaller suppliers really compete with the scale, infrastructure and corporate investment that is accessible and readily rolled out by larger supply chain partners? Do procurers need to choose whether their projects should set a social value agenda that seeks to deliver opportunity and benefit to local business or one that delivers personal opportunity and greater cohesion through greater “grass roots” intervention?

Through Scape Group’s Built Environment Consultancy Services (BECS) framework, the Perfect Circle joint venture, working with a number of local authorities such as Milton Keynes Council, has developed an alternative model on regeneration and house building programmes that suggests a “best of both” alternative.

Taking regeneration as an example, there are a myriad of delivery activities – refurbishment, external works, new build housing on infill sites or on a larger scale. Many of these lend themselves to smaller works packages that can be delivered by local contractors and design professionals. Whilst this contracting strategy could alone be deemed to meet obligations, it doesn’t necessarily deliver investment in apprenticeships, skills centres and community events as the economies of a more fragmented delivery strategy do not sustain this. By creating a social value function at programme level (in effect replicating the internal social value coordination team of a large supplier) this fragmentation can be resolved – delivery partners can still make contributions commensurate with their involvement but instead of “doing what you can” with these in isolation, the programme team instead collect these up and use them to deliver an outcome where the sum is undoubtedly greater than the parts. Through such an approach you can:

• Fund more significant investments such as training academies that the entire supply chain use and support, having a contribution mechanism from each delivery partner that reflects the scale and value of their activity that can then be pooled and applied
• Develop sufficient work scale and content to support apprenticeship programmes across multiple providers. Where appropriate, there are now a number of charities that will employ the apprentices to provide into such programmes
• Pool consultation and community engagement strategies and events. These will not only reduce the burden on individual suppliers, but allow communities a better opportunity to understand the whole picture
• Create shared supply chains and buying clubs to make sure that any local buying that would have occurred under a national contractor still happens

This model will not suit all circumstances, but where it is used, the meeting presence of this dedicated social value function as part of the project office serves to shine a light more fully on social value strategy and outcomes. This serves to ensure an SME supply chain can deliver the ‘big ticket’ benefits as well as benefit from the opportunities of their local projects.