Along with ‘purpose driven’, ‘social value’ has become a buzzword in recent years. As a result, consumers demand more of the companies they buy from, and more public sector procurers include social value clauses in their tenders.
From the outside, social value can seem complicated and expensive. A quick search online reveals ‘social value’ being tossed around in many contexts, from a box to tick to an aspiration – there isn’t even an agreed definition. In truth, social value primarily depends on what your organisation is good at, your goals, and the specific circumstances in which you operate.
Without exception, every one of the companies we’ve worked with has seen multiple benefits. From improved staff retention to an increase in new business won, from working to maximise the social value of their activities. So why don’t more companies do it? Mainly because it takes time and it’s not easy. Too many people think they can rush in, tick a box, and move back to ‘business (more or less) as usual.
Social value may soon be the path that keeps the economy and companies healthy. But doing social value well isn’t as straightforward as it sounds. It requires a new way of looking at how you do things in your business. And the way different parts of your organisation work together.
If done correctly, it can enhance the commercial value of your company. But, on the other hand, it can be a costly, damaging exercise that can blow up in your face. So how do you do it properly?
Here are six tips for creating social value in a way which will generate tangible benefits for society, as well as building commercial value for your business:
Social value must lead from the top. It must be strategically positioned within the operations function of your business. If it is the purview of the communications or marketing team, it will be treated as an add-on and something you are only doing to look good. That never ends well.
It would help if you had people understand how your business operates and its financial drivers. Who have good communication skills; and can engage with your stakeholders and find out what they need. They also need to be senior enough in your organisation to have an impact and understand how the third sector and local communities work. That’s a unique skill set, but it’s vital if you can join the dots and make the connections you need to do social value well.
The most meaningful approaches to social value are when businesses use the same approach to creating social value that policymakers take to make policy. So, spend some time working out what the essential people want you to do, and then find ways that work for you.
If you’re creating social value for a public sector bid, align your offer with the strategic priorities of the organisation you are bidding to work with. Every public sector procurer publishes annual strategic plans. Please read them.
If you create it to enhance your commercial offer, talk to your stakeholders and conduct a socio-economic study. For example, determine your industry, sector or local community’s challenges.
Then talk to the public, community and third sector organisations working to address these issues. And ask them what they need and (more importantly) what you could do to contribute to the solution.
Here is a helpful article that lists the UK’s leading think tanks.
The UK Government also conducts a lot of public consultations. It produces many policy documents, which you can read here.
For example, many of these ideas for practical ways businesses can contribute towards efforts to address climate change are based on opinions found in publicly available policy papers.
You won’t be able to do everything, nor should you be aiming to, but small changes often make the most difference and have an open mind. For example, if you’re a heating supplier, could you support a local charity that helps people struggling with fuel poverty? If logistics is your business, could you incorporate more social enterprises into your supply chain? For example, could food manufacturers work with organisations to combat obesity? And recruitment agencies partner with organisations helping to tackle unemployment and improve the skills gap amongst the most disadvantaged.
The help they need varies widely and, more often than not, doesn’t have to be expensive. If you redirect some of your staff’s volunteer days more strategically, that costs you practically nothing. Most third-sector organisations and community groups would value professional help with their back-office support functions such as HR, Finance, IT or Marketing. If you show you mean it, they would love the opportunity to engage with your business and influence your activity. You might be surprised by what you learn when you look at things differently and listen to their suggestions.
The key to success is to ensure that you generate maximum value for your business and the community you are trying to benefit.
For an organisation considering creating social value, find suitable investment projects. Then deliver what you promise, and report back on the benefits. Many social impact measurement experts like Social Value Lab or Social Value Portal can help with this.
Telling your stakeholders about it is crucial. Just because you aren’t treating this as a PR exercise doesn’t mean you shouldn’t talk about what you are doing. Just make sure you tell them after you’ve done it.
You might have to resist the demands of your PR people on this, but if you do it right and invest in your relationship with them, you might find they tell people for you.
Getting your social value offer right will inevitably require investment – but the payback in winning contracts, credibility and positive public perception is potentially huge.
The reverse is also true – businesses that fail to embrace social value risk damaging their reputation and losing out to competitors. Especially in a world where news is instant, people who have no intention of ever buying your products can significantly impact your organisation.
Suppose businesses as a group can work together to take on this mantle. In that case, another big win is avoiding costly legislation when governments inevitably wade in to tackle problems by force. Think the sugar tax, minimum alcohol pricing and the landfill tax (to name just a few).
