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Back in November 2020, the Construction Innovation Hub released the Market Enablers Interim Report, a summary of the findings from the Market Response Workstream of the Value Toolkit. Through 12 structured online workshops, held in partnership with industry bodies and associations (involving 131 participants from 93 organisations), a dialogue was established to understand the benefits and perceived barriers of value-based decision making across the sector.
Continuing this dialogue was key as we entered the new year and subsequently the second round of engagement activities, which spanned 12 in-depth workshops with 90 participants, from 66 organisations across the supply chain. This round of workshops involved organisations and individuals we had previously engaged with, as well those new to the Value Toolkit.
There was broad agreement with the initial findings and a clear desire to have the views and requirements of the supply chain reflected to support the Value Toolkit development. Our engagement confirms that the sector is highly supportive of current policy drivers towards value-based decision making. But without clear alignment in practice – particularly around terminology and language – we could risk seeing the Toolkit unable to achieve the level of change required.
Those we engaged with see genuine opportunity in the Value Toolkit and the opportunities it will create for businesses to become more customer focussed. However, the workshops uncovered critical areas of support required to help business models adapt to value-based approaches.
Here are the 5 top takeaways from our second round of engagement activities:
Industry strongly backs both value-based delivery and the implementation of the Value Toolkit. The potential is clear to see, however, confidence in its delivery can waver. Many have tried and failed to implement similar plans in the past, so there is a need to commit to the recommendations of the Market Enablers Report, ensuring the views of the supply chain are reflected in the final Toolkit.
Participants in the second round of workshops agreed that the report represented their views on key topics that need to be addressed in the final stages of the Toolkit’s development. Many comments referred to previous key findings, such as old biases towards cost, and ensuring that clear language and terms are used across the Toolkit.
There is a need for the clear realisation that, if in the final stages of development of the Toolkit, the needs of the supply chain fail to be met, then the response to any value-based procurement will be weak.
The supply chain perceives the Toolkit as a significant venture that can unify and build on the initiatives and policy that have already been established to drive value-based decision making. Providing common language and theory hold significant value, even if this requires adopting the work of others and not creating a new spin or set of terms. This was reflected in the 63% of participants who felt that establishing common themes throughout key industry drivers would have the biggest impact on the industry.
With this in mind, the supply chain is keen for consistent language to be used in both the metrics and models, drawing from already understood, pre-existing terms. Providing guidance on how the Toolkit is used, with the new key legislation around Brexit and policy such as the Playbook and Social Value procurement guidance (PPN 06), will however make a significant difference.
There is a call for common themes and language to be mapped, along with recommendations, to ensure that they are aligned and replicated throughout the Value Toolkit. Where this is not achievable or desirable, it should be made clear as to why this is the case, and where common themes currently do not exist, we must be able to signpost people to the reasons why they don’t.
The supply chain recognises the strong opportunities that value-based procurement presents, both from the perspective of their own culture and procurement activity, but also from their ability to create market advantage and add value to their own clients.
Industry should recognise that change is a constant for the supply chain. As key issues have been brought into focus over the years – from health & safety, to digital adoption and carbon reduction – the supply chain have continuously innovated solutions and spearheaded the response by taking ownership, adapting and delivering many small steps to create big outcomes.
Training, guidance, and development for the supply chain is key to the success of the Value Toolkit rollout. Helping individuals feel confident in what they are delivering and what they are being asked to respond to will increase engagement and retention within organisations, which will in turn boost capability, adoption and productivity across value-based decision making.
Employee training and development can also create additional benefits for employers. If developed and delivered in the right way, training opportunities around value will help to attract a new generation into the industry and strengthen employer brand.
Many organisations are data rich but knowledge poor, or rather they are unsure of how they turn the information they have into a meaningful response to the value drivers of a client. The manufacturers who took part in our workshops demonstrated how they are already using data to innovate within the industry. We need to transfer this knowledge and share it across the wider supply chain.
There is a considerable amount of data that is either not collected or exists in a fragmented manner. If we are to successfully unlock value-based decision making across the whole supply chain, then the industry requires support to understand data and its potential value to both them and their customers.
Continuing the conversation
Overall, the participants in our second round of engagement activities confirmed that the Value Toolkit has great potential in helping the supply chain understand the true value it can bring to customers and end-users. It’s clear, however, that training and support will be required to help business models adapt to the environs of value-based decision making.
Going forward, further engagement will take place in the form of more targeted workshops. These will enable participants to understand the key touchpoints for the supply chain and support for businesses in the supply chain that are getting ready to respond to clients with a more value-driven approach.
Blog post written by John Handscomb. John is a Founding Partner of Akerlof and supports the delivery of the Value Toolkit’s Market Enabler workstream.
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