I would like to add my welcome to that of Peter’s. It great to be in this magnificent venue with an equally magnificent audience!
For Interserve and SEUK this is our third Social Value outing together and we are delighted to have added another member to the band. The opportunities presented by being a trio are much greater than as a two piece and I look forward to seeing what we come up with today.
The third social value summit could feel a bit like that “difficult third album”.
I was challenged in planning this event as to my choice of music. My initial response would not have been suitable for this event but after a few seconds the obvious answer was Led Zeppelin, sorry, I am a man of a certain age.
So in third album terms Led Zep III has a lot in common with this social value summit. With tracks like Celebration Day, Friends and That’s The Way. [Out on the Tiles]…..[Hats off to Roy Harper]
- We should celebrate the Social Value Act: it has had a far reaching impact across much of UK life and I am told is now reaching further into Europe, the Middle East, North America and the Caribbean.
- We have developed many new friendships along the way, not just with SEUK and Business In The Community, but with other like-minded organisations (both large and small) like Groundwork Trust, Bounce Back and We Do Print.
- We have found new ways to deliver services with partners from across all sectors such as those in working with our Justice team, Purple Futures, as we seek to play our part in reducing reoffending. Yvonne Thomas is with us and will be speaking later on so I will not steal her thunder from here.
If not directly causal, because we were pursuing a big agenda of our own anyway, the Social Value Act has certainly benefitted my own business. We developed our SustainAbilities Plan at the same time as the Act was being passed, which has proved serendipitous in terms of a mutual agenda for us and many of our key clients.
For a business that directly employees 85,000 people around the world and has been involved in community and public service for over 100 years, you will not be surprised that Social Value is woven across all five of the outcomes that we are pursuing in our Plan:
- Places that benefit people
- Public services in the public interest
- More Skills, More Opportunities
- Positive Environmental Impact
- Sustainable Growth
None of these outcomes can be successfully delivered if we do not pursue social value and track the impacts that we are having.
I will come back to that last point about tracking progress in a moment, because we’ve made a lot of headway in the last twelve months.
But actually I don’t want to use my time focusing solely on the exciting work going on at Interserve, nor to simply review what we have done since the last Social Value Summit and Lord Young’s review of the act. I would also like to look to the future and to issue a call to action for commissioners, providers and the wider community to expand the understanding and use of social value. We need to be courageous and we need to work together to create this change.
In very simple terms, we in this room all know that good business means caring about a lot more than just money. We all get it. But we could all do a lot more if asked and we should all be doing a lot more to promote the behaviors that underpin that broader definition of good business.
This idea is well-established: we understand what social value is and how we can deliver not only the core technical requirements for a contract but also the valuable social benefits that can flow from the way buildings and infrastructure are created, operated and maintained. We also recognize that business processes and public services touch not only those at whom they are directly targeted but also many more who are indirectly impacted by what we do.
We understand these processes, we understand the skills needed to deliver them, we have the ability and desire to invest to makes these things happen.
But, personally, I am disappointed that we are not being asked to do these things more often; and that we are rarely judged and measured on our ability to deliver Social as well as financial Value.
A typical tender document will, and I generalise here, start by our prospective customer saying “we presently do X and it costs Y and we employ this many people to deliver it.”
“We would like you to do all of that but cheaper.”
And, sometimes, as a coda, “Oh and by the way if you can also make us look good while you are doing it that would be great”.
That is a gross simplification of what can often be a very complex, time consuming and costly process for all parties. But what is beyond dispute is that the price-point of a service is at the core of the majority of decisions around winning and losing sales in my industry.
We very rarely see potential clients asking us what we “can” or “could” do to re-imagine their service, to create systems and processes that are agile and adaptable, and therefore future proof. Nor do we see many contracts cogently using the traditional measurements – cost, quality, reliability etc – as just one part of assessing effectiveness in the contract’s real purpose, which to my mind is to enhance the lives of the people it serves.
Challenging as that broader lexicon is, we’d love to have the chance to answer the question: “I have £x….what’s the most you can give me for that, how can you make things better”….allowing us to sell value, sell our imagination, not simply compete on cost and in a race to the bottom.
And it gets all of us to raise our line of sight to why and how we’re doing what we are doing rather than just how much and at what price.
Most of the contracts we have run for at least 3 years, many will be for 5, some for 10 and a few 25 or more. Many of the relationships we have with clients are much longer, 10, 20 30 even 40 years.
Lasting relationships are founded on trust, adaptability and a real understanding of what each of us wants and can offer the other. So, for social value to become even more embedded in business life, we need to start asking better questions. And, as service providers, we need to raise our game in anticipating and responding to them.
The sort of questions I’m thinking of are those which embrace the inevitability of change, that allow partnership to be developed, solutions to be found and problems to be solved: for ultimately the problems of operating in a world with scarce natural resources, scarce skills and insight and in which we seek better community cohesion and quality of life are problems we all share and all need to see answered well and sustainably.
So, there’s a whole host of reasons for upping our collective game and positively differentiating ourselves that might make us take social value seriously.
For me, though, there’s another set of reasons too why as providers we need to be much better at demonstrating and articulating our social value proposition….existential necessity. That’s a big phrase, but not, I think, an over-dramatised one. Put simply, our world of outsourced service provision is evolving, and if service providers don’t evolve with it, we will die – maybe swiftly through some sort of reputational disaster or slowly of irrelevance and obsolescence. If I think forward, I find it hard to imagine that any business which doesn’t stand for something about its role in society will survive. Of course, creating shareholder value is a central purpose of any enterprise, but I don’t think it’s credible, let alone moral, to think of shareholder value in a vacuum without thinking too around the impact that generating such value has on the communities and stakeholders affected by our activity.
So, whether because we believe in the positives/opportunities or in the negatives/risk (and by the way, I believe in both), I think we need to push the bar ever upwards on what’s expected and permitted in the way services are designed, commissioned, bought, sold, delivered and evaluated.
As a market stimulus, the much broader definition of what good looks like that the Social Value Act gives us, enables greater competition and challenges each of us in the relationship to be creative, innovative, agile and imaginative. It promotes services and structures that evolve with the people who use them and pay for them. It gives creative social entrepreneurs the opportunity to compete with established “conventional” business or indeed to collaborate with them, each playing to their strengths.
Despite what I said a few moments ago, I can’t resist the temptation to say a few words about my own company, Interserve, in this context. We were recently part of the winning team in the Big Society Capital, Business Impact Challenge along with our partners Catch 22 and Club Finance. Our idea is The Public Services Lab.
Our experience of the past few years is that there is a gap between the political ambition behind public sector commissioning and, the capacity of the social business sector to respond. Therefore the requirements of public procurement need to be de-risked to enable social enterprises to participate more fully. The Lab will support voluntary, charitable and social Enterprises to build the skills and access the finance to meet the more challenging questions we expect to be asked in winning business and achieving growth.
In a similar vein, but on a smaller scale, we are also looking to build the capacity of social enterprises in Yorkshire. In partnership with ASDA, we are leading BitC’s arc programme, seeking to create 1,000 jobs and generate significant social value from the partnership of large and small businesses tackling local community and social needs.
Are we, in these ways growing our own future competitors…maybe…or are we using what we’ve got to help others at no cost – indeed with many benefits – to ourselves….I’d like to think so.
Anyway, we’re doing these things, because we believe in the social value that will be created.
So well done us, but these are relatively small first steps.
We want to be asked to do more and we want to help those asking and answering the questions. To see better questions we must have an uplifting of industry (traditional and social) to respond. This in turn must increase the confidence of commissioners to ask bigger, longer, deeper questions and to be prepared and permitted to make their choices on a balanced scorecard.
I promised to come back to tracking impact. Our SustainAbilities Plan is built around trackable performance. I deliberately use the phrase “Trackable” as it’s about understanding the impact we have not just measuring it.
At last year’s summit we published our proof of concept design document for Social Value Mapping. I promised we would update this summit on progress. We have been working hard on this methodology of understanding our social impact. It’s been a great success: we have now entered the “production” phase and will start reporting on our social value impact later on this year. We’ll do it contract by contract so individual customers can understand how our work with them impacts the communities we both serve. And I hope we’ll be able to aggregate our reporting as well. So, watch this space….
We can do more if asked.
We want to and, I think, have to.
We at Interserve are helping to build capacity across sectors to answer and deliver on the social value agenda and we are looking at the best vehicles through which to deliver this.
The outcomes, I believe, are that we are building flexible and agile partnerships that can achieve enduring success in a fast-changing world, and my hope is that we are building trust as with trust comes greater social value.
But we can’t do it by ourselves, which is where you, here, today, can step up too.