Why the Co-op opted for SRM over tenders for social value

Will Green is news editor of Supply Management
9 June 2021

The Co-op opted to start with supplier relationships rather than contract terms when it came to embedding social value.

Claire Costello, CPO at the Co-op, said an organisation’s biggest spend was often tied into long-term contracts, so it made sense for the Co-op to start its social value journey with strategic and critical suppliers.

Speaking at the CIPS Global Conference, she said the public sector had begun by adding social value clauses into contracts.

“We flipped it round. We did it through the relationship first and then moved into the tenders,” she said.

“You’re only tendering your big spend every so often. Most of these contracts are multi year, which means you’re not going to get after some of those bigger partnerships for quite a period of time if you wait for it to come up for its next renewal.

“We felt, let’s go after those partnerships first where they’re much more aligned and do it through the relationship, then go for the tender afterwards. There isn’t a right or wrong, it really needs to be how can you fit it into the capability and capacity of your team.”

Costello said social value – the Co-op uses the term “shared value” – involved a new set of questions, analytics, and training for procurement teams.

“It starts with a conversation with your team. The first thing we had to do was make sure the buyers understood what we mean by social (shared) value.”

Costello said outcomes from the Co-op’s social value programme included a community space built next to a new store at the request of a parish council and its sponsorship of schools in the north of England through the Co-op Academies Trust.

However, she accepted it was a challenge to measure the results of social value activities.

“The reality is you want to see it measured and put a metric against it. We’ve got a long way to go before I would be happy with where we are on that,” she said.

“We capture and report against the projects we’re working on, but more from a storytelling perspective so we’re not putting the economic value to it today. We’re doing a lot of work to be able to do that in the near future but today we’re not able to do that.”

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