A Strategic Approach to Procurement

Procurement as a strategic function 

The social housing sector currently spends billions of pounds each year on repairs, maintenance, new builds, components and services. This means procurement has a real impact on the outcomes of the sector, the health of the housing portfolios and the overall social impact that is created. But are organisations using procurement in the best manner or are they treating it as a process that has to be followed, a way to purchase goods, services and works rather than as a strategic tool that can help deliver lasting value. 

We are seeing a shift in mindset.  More housing providers are rethinking procurement, recognising it not as a simple transaction but rather as a strategic tool for compliance, community investment and long-term organisational resilience. 

Looking beyond the lowest price 

In challenging financial times, there is understandable pressure to focus on price. But the cheapest option does not always represent the best value. While a lower-cost choice may look attractive in the short term, true value should be assessed over the full life of an asset. Effective procurement decisions should therefore be guided by data, lifecycle analysis and a clear understanding of residents lived experience, translating these priorities into measurable contract outcomes. 

In a period of tight budgets, this may seem counterintuitive, but it is about securing value for money. The regulator’s Value for Money Standard calls on organisations to make the best use of their assets and resources. This supports procurement models that deliver long-term contracts based on performance outcomes rather than simply activity. Taking a longer-term view also helps housing providers plan investment cycles more effectively and reduce reactive spending. 

Putting residents at the heart of value 

The best way to judge whether this approach is working is to look at the experience of those most affected by it, the residents. Value should be defined largely by what they see in practice. Are repairs completed more quickly? Are there fewer repeat visits? Are higher-quality materials being used? We should ask ourselves how much of the residents’ perspectives are reflected in today’s procurement decisions and how their contribution could be strengthened. 

Connecting procurement with asset management 

Asset management is long-term in its nature. It starts with a purchase decision and when to invest but is then supplemented through when to repair and when to replace. This is where procurement plays an important role, aligning strategic objectives with competitive purchasing while focusing on whole-life asset performance and value. 

We are seeing more organisations aligning their asset management and procurement more closely. They are using their stock condition data to shape the specification of contracts, and they are investing in building supply chain relationships that become more like partnerships to allow for joint long-term planning and the evolution of shared standards to build more consistent outcomes for residents. 

We welcome this more strategic approach.  

Why procurement needs a stronger strategic voice 

Procurement is under-resourced in housing organisations and can sometimes lack representation at a senior level, which can lead to a misunderstanding of its role and why it might struggle sometimes to be seen by some as a strategic tool. Maybe it needs to be viewed through a different lens. 

Reducing risk through better procurement 

Procurement can help manage organisational risk. Regulation that surrounds the social housing sector such as The Building Safety Act and Awaab’s Law creates legal duties for housing providers that will depend on the quality of the partners they choose to appoint and provide the works.

Poor implementation not only costs money to repair and replace, it also brings the risk of falling foul of regulation. Good procurement that helps identify approved, capable and competent suppliers that can work in partnership on long-term contracts can help to mitigate some of the risk and further cost. 

Creating social value through the supply chain 

How we procure really matters. In the housing sector alone, we have a combined spend that is one of the largest commissioning pools across the UK economy. So, how that is employed helps to shape local economies. 

Building skills and stronger local economies 

Influence on the workforce challenge is where real change can be made. There is a lot to do to build, maintain and decarbonise the social housing sector and it needs a qualified and skilled workforce to deliver. Strategic procurement can help shape where contracts are placed and can help to specify training pathways as well. This can create a real stimulus in local economies which has wider benefit to the communities that the housing is situated within. 

A long-term opportunity for social housing 

The social and affordable housing sector faces many challenges, and while procurement cannot solve them all, it can make a meaningful difference when used effectively.  

Taking a long-term approach moves organisations away from stop-start, transactional buying and recognises procurement as a strategic function that supports asset management, delivers social value and creates benefits for both boards and residents.