This month’s issue of Supply Management featured a question from a reader who wanted advice on measuring the outcomes from community benefit clauses in contracts.
Here’s some more expert guidance on the topic:
Sue Moffatt, director, National Procurement Service for Wales
Community benefits is a key principle of the Wales Procurement Policy Statement (WPPS).
The policy is well established across Welsh public sector procurement, and is underpinned by a community benefits measurement tool that enables organisations to measure and report outcomes in a consistent manner. This has been key to embedding the approach.
The focus for community benefits in Wales is tackling poverty and this is reflected in our measurement tool. Developed collaboratively with our key stakeholders, the measures are specific to Wales and capture our policy’s contribution to social, economic and environmental priorities, including employment opportunities for unemployed persons, training weeks provided and spend with SMEs.
I strongly advise against thinking one set of measures will be equally applicable for every procurement. Our policy approach and measurement tool helps procuring organisations consider the scope for delivery of community benefits and to properly understand the priorities that are specific to them which can be supported by the procurement in question.
Clare Tetlow, senior procurement manager, on behalf of Re:allies
Community benefit measures and related performance indicators that are used to judge success should be derived from the fundamental purpose and core values of a business.
The clauses must be capable of creating a tangible benefit that can be measured and validated, ideally using primary sources of information that are directly controlled.
Reliance on third party data to support measurement is often unavoidable but it’s crucial the nature and reliability of this is well regulated. The greater the distance from primary source data, the less reliable the result will be, which is demonstrated when using many of the ‘Social Return on Investment’ models promoted by various consultants with an interest in such matters.
Return on investment metrics can widen the performance indicators to include factors outside the control and influence of the organisation, making them impossible for independent validation. Moreover, this approach could result in the inclusion of factors that do not serve the interest of the desired outcome and create the basis for unnecessary discussion which increases cost to a business.
The ultimate aim when deploying these clauses should be to ensure the measurement process results in clear information which generates robust insights, tracks progress in real time and enables decisions to be made that provide the basis for organisational growth as well as local regeneration.