Social Return on Investment (SROI) for Contract Tendering
The UK Government has pledged to open up the delivery of public services to private sector outsourcers and voluntary groups, in the long delayed Open Public Service white paper which they unveiled earlier this month. Outsourcing to the private sector and voluntary sector is not new, organisations in both these sectors have been delivering public sector contracts for the Department of Work and Pensions, the Department of Health, Local Authorities and others for years. However, when few voluntary groups were awarded contracts in the recent tendering round for The Work Programme, the question now is how can voluntary groups take advantage of new opportunities, when their competition is large private sector companies, able to use economies of scale and run 'loss-leaders' in order to secure a government contract.
At Charity Fundraising Ltd, we come across many organisations that are doing fantastic work, achieving impact within their communities and yet shy away from public service tender opportunities. With traditional funding through grants and donations becoming ever more difficult to achieve, we believe that the organisations that will thrive in difficult economic times are those that can innovate, diversify their income and embrace new funding opportunities.
Anyone who has participated in a tendering round, will know that it is not easy. Making yourself stand out from the crowd, particularly one that may be dominated by much larger organisations is difficult. This is why at Charity Fundraising Ltd, we are developing a new programme around helping voluntary organisations tender effectively.
One of the key elements of this programme is helping organisations understand and develop Social Return on Investment (SROI) systems. If you haven't come across SROI before, it is a means by which organisations can “evidence the monetary value of the social, economic and environmental outcomes achieved by a project or on-going activity”1. For example, examining how a befriending service results in reduced visits to local GP’s. In a climate of financial austerity, governmental commissioners are looking for value for money – being able to show a commissioner in real terms how your work will help them make savings elsewhere, could be the tipping point between a tender which succeeds and which is rejected.
If you haven't undertaken an SROI evaluation yet, it is well worth considering the benefits. A good SROI evaluator will help you not only evaluate your work now, but also help you develop the monitoring and evidence collection systems that will assist with further SROI evaluation in the future. Both the evaluation and the on-going monitoring will likely prove invaluable for your tenders and discussions with commissioners, and investing now may help you to remain ahead of the game in the future.
1 The SROI Network
