The words “love” + “procurement” aren’t often seen together, but here at Procurious we’re hard at work changing the face of procurement.
As part of a Valentine’s Day special, our founder, Tania Seary (who has a long-standing love affair with all things procurement), is exploring ways that procurement professionals can ensure everyone they touch can “feel the love”.
At Procurious, we’re very social (both on and off the field). You usually hear us talking about the benefits of social media, but this time we’re talking about the benefits of getting involved in social procurement… that is – using your corporate spend power to award contracts, to social enterprises and local businesses to generate social benefits beyond the products and services required.
Feel the power
There is enormous untapped potential for social procurement to act an agent for social change – our profession can make a huge impact!
Social procurement creates jobs and opportunities for people who may have struggled to find work and can also reinvigorate depressed or marginalised communities.
Not only are we helping our communities “feel the love”- but we’re also helping our own company. Spending money with community groups and social enterprises improves our own company’s staff engagement, brand equity and enables us to do something that is truly socially good without compromising financial return to shareholders.
So now it’s not only the corporate sponsorships and social responsibility teams who get to help those in need – procurement can also make a huge contribution to the community.
Choose your weapon
Embedding social procurement into your existing procurement framework will require some changes. And, as we know, change isn’t always easy, so you’ll need to be both creative and patient. According to Dr Ingrid Burkett from the Centre for Social Impact in Sydney, you have four options (“weapons”) for initiating social procurement within your organisation:
- Contract – The most obvious approach is to incorporate social impact requirements into tenders, new or existing contracts, or evaluation criteria.
- Policy – You may choose to use policy to ensure you meet your social procurement objectives – these can include requirements such as percentage of spend for social impact, meeting statutory or regulatory requirements and local supplier spend commitments. For example, many mining companies use a policy approach that mandates each of its mines must have a documented strategy for local procurement that is endorsed by the senior leadership team.
- Supplier – Directly engaging with suppliers who have a mission to deliver social value is one of the most common approaches to social procurement. Many social enterprises have independently integrated themselves into corporate supply chains by winning tenders without specific consideration to social value. In fact, without being deliberate about it – you are probably already procuring from social enterprises.
- Market (supplier) development – If you want to work with social enterprises but there are none operating in the category required, you will need to innovate. For example, in planning the establishment of the Diavik Mine in Canada, Rio Tinto developed local suppliers capable of meeting their expected future business requirements through training, local employment initiatives and by stimulating contracts for these businesses.
Be credible and creative
Once you have worked out the “how”, the next step is obviously to choose the most credible social procurement options to suit your company’s business objectives, profile and culture. Try to be creative about the “best fit” for your organization. The best example I have heard of was a major retailer, who sponsored a bike maintenance service at their national headquarters. Unemployed youths were engaged to learn how to fix bikes and earned their way to a trade certificate, while employees were encouraged to get fit and ride to work and help reduce carbon emissions! How many boxes can be ticked with one initiative?
Get your CEO into the picture
Literally… if the category and social enterprise you have selected ticks all the boxes for your organization (strategy, mission, other initiatives etc.), then use your marketing nous to convince your corporate affairs and media executives that the CEO should do a site visit and understand the company’s commitment to the selected social enterprise. Make sure there’s a photographer there (mind you, I’m sure your company’s PR gurus will have this covered) as this is exactly the type of material that gets featured in annual reports. Perfect.
Social procurement is not “business as usual” – it presents unique challenges and opportunities for both the buyer and the seller. Successfully introducing anything new into a large organization is difficult. The greatest challenges to introducing social procurement is having enough people and time, identifying appropriate categories of spend and gaining organizational commitment.
For social procurement to be effective there needs to be a truly enabling environment: this includes senior management support, the right tools and infrastructure to support it, establishment of effective supplier networks and increased community and government recognition of its importance.
So, do you know how to “show the love” to your communities? What’s your story?