Why supporting SMEs is more than just a requirement for frameworks – it’s our duty to the community
MD Victoria Brambini discusses why framework providers should be supporting SMEs.
Businesses that have growth strategies connected to deeper values, not just commercial ones, are likely to experience greater levels of success; their people have an increased sense of connection to their business their teams work smarter and it’s highly likely that customers experience a better service.
It’s therefore no surprise that many public authorities want to see an increase in SME involvement in their built environment projects given that SMEs have a deep-rooted sense of purpose; living, learning and working in their communities.
Better opportunities for SMEs
Many authorities look to use local suppliers but, due to constraints around pre-qualification criteria and tendering timescales in procurement regulations, it can be difficult for them, so SMEs can miss out.
While the marketplace can sometimes seem to be challenging for SMEs when looking to win business with public authorities, there are ways to engage through frameworks that offer access to many and bigger opportunities.
Public sector organisations often have excellent existing relationships with local businesses and want to continue to work with them. However, they are often unable to appoint them directly for projects due to the need to meet certain criteria, primarily due to procurement regulations.
Time-consuming, costly and sometimes complex aspects of tendering can put SMEs off engaging with the public sector. It can involve drawing key staff away from project delivery and bidding for work comes with no guarantee of securing the project.
Integrating teams: the role of framework providers
The government aims to have 33% of its procurement spend going to SMEs by 2022. With this in mind, it is essential that suppliers to the public sector act now to develop their supply chain spend and facilitate increased opportunities for local businesses.
Frameworks can offer direct opportunity to public sector projects, major suppliers on frameworks must build relationships with SMEs and shape integrated project teams. They can build a network of local suppliers and make greater contributions to the government target, helping regions achieve their Local Industrial Strategies, while meeting client preferences for using local teams.
At Perfect Circle, we are striving to improve our level of supply chain engagement and aim to spend more than £70m by the end of 2020, integrating our network of suppliers.
Supporting our SMEs
Framework providers have a duty to support their supply chain partners with fair and faster payment terms and support them in contributing and reporting on social value.
By connecting the experience of larger organisations with the expertise and local knowledge of wide-ranging supply chain networks, framework providers are able to bring together the strongest collaborative teams. They can ensure true value for money and enable authorities to maximise local spend, while delivering high-quality projects that contribute substantially to social value.
Responsible procurement can create increased social value
There is no exhaustive list that definitively describes how social value can be added. Instead, we can draw contributions from within some value-add categories that influence our behaviours to embed social value into everything we do.
Similarly, there is no definitive set of priorities across public sector organisations; the contributions to social value must be considered in the context of local needs and the priorities will vary across communities.
What is clearly apparent is a shift in procurement practices to increase the importance of evaluation criteria weighted towards quality and inclusive value, and not a race to the bottom line of lowest price.
The importance of social value as a key element of value for money is growing. Some may say it’s long overdue some seven years since the Social Value Act required public authorities to have regards to economic social and environmental wellbeing in connection with their contracts.
We are now seeing clients demanding up to 20% social value add on their contracts, now realising the partnership contributions that the private sector can offer them. Our industry has long been including social value overlays into our businesses, but we can now achieve much more with a steer from clients on priorities and by working collaboratively in defining detailed deliverables and calculating contributions.
Developing trusted partnerships with long term relationships is the smart way of contracting to bring bigger benefits for both business and communities. Businesses that have growth strategies connected to deeper values, not just commercial drivers, are likely to experience greater levels of success: people have an increased sense of connection to their business and the community they work in, social value contributions are deeply embedded and more naturally occurring. Organisations with purpose will have strategies to achieve more for their clients and score higher in procurement choices.
Perfect Circle offer the public sector the broadest range of consultancy services via the Scape Group National Built Environment Consultancy Services (BECS) framework. Open to all public authorities, the framework generates social value on every project through collaborating with stakeholders to determine priorities and embed a way of working into teams that values communities.
As well as using local supply chain, we will work with third sector organisations, use our knowledge economy to offer pro bono support, have staff volunteering within their communities and make social value informed employment choices.
To date, we have provided more than 8,100 hours of community engagement, offered 203 work experience opportunities, dedicated over 5,500 hours to local charity volunteering and spent 6,248 hours engaging with local schools. We have recruited almost 500 graduates and sponsored 3,044 university or college students.