Lost in translation: defining ‘cultural fit’ in procurement
Millstream general manager Penny Godfrey discusses the procurement issues raised around ‘cultural fit’ and worries that the introduction of such criteria sets a dangerous precedent
The tendering process is all about providing a level playing field and this is particularly important when the public sector is procuring. It is about giving organisations a fair opportunity to vie for business, by providing accurate information and responses to questions posed. The evaluation process is therefore about comparing like with like across various criteria.
Given the amount of potential business that can be won through such processes it is unsurprising that public sector procurement must be undertaken in line with specific national and international regulations.
That is why the introduction of so-called ‘cultural fit’ criteria on two Department of International Trade ITT advertisements for two short term digital projects raised concerns.
Indeed, the criteria in question have been labelled potentially ‘illegal’ as they are too subjective to comply with EU procurement rules.
The fact the criteria in question also seem to be Brexit related adds fuel to the fire. Specifically, companies were asked to demonstrate they were ‘committed to the best possible outcome for the United Kingdom following its departure from the European Union’ in order to have the right ‘cultural fit’.
The other sub-criteria in this selection questionnaire section require tenderers to ‘be focussed enough to stick to the task at hand and not be side-tracked in a vast and quick-moving field; be committed and hard-working, to deliver under time pressures; and be enthused by the prospect of working at the frontline in such an exciting and dynamic area.’
The cultural fit criteria equated to a significant 15% weighting in assessing which company to pick. When compared to 20% for price, in this instance it was clear that ‘cultural fit’ had considerable influence on buying decisions.
The key question the use of such criteria raises is - how could responses be fairly and dispassionately judged? The very nature of the criteria outlined are arguably leading – implying that respondents will be favoured if they indicate their ‘cultural approach’ leans in a particular direction. That said, when you look at the wording you don’t have to be ‘Pro-Brexit’ just be positive about implementing post Brexit changes and being flexible to do this which is totally different.
So, how can such criteria possibly be evaluated in an objective manner? The only possible way to achieve this would be to have set values and ask suppliers to evidence their adherence to these. Suppliers could evidence their ‘cultural fit’ referencing all the regular and potentially related policies and processes. While this may (almost) be appropriate for sub sections on ‘hard-working’ and ‘delivery to timeframes’ type measures, there would be no such policy or procedure which could demonstrate, ‘commitment to the best possible outcome for the United Kingdom following its departure from the European Union’.
The challenge is that it is difficult to assess what ‘cultural fit’ actually means and, therefore, how can it be measured in a fair and transparent way. Cultural fit criteria as outlined in this example therefore goes against UK and EU procurement rules.
This is the first time we have come across such a situation – it’s pretty unique.
The only other potential comparison is the current struggle to define a standard way to evaluate social value. This is a topic the public sector has struggled with since the Public Services (Social Value) Act in 2013. It can be very subjective as to what counts as 'Social Value'. Additionally it is proving difficult to measure and monitor that the intended benefits have been realised in contract delivery.
For example if someone offers two apprenticeships as part of the delivery of a contract then that can be easily checked. However, there are then further considerations around who then gets awarded the apprenticeship - did they go to young people who otherwise would have been unemployed or did they get given to people internally looking for career changes. One is more socially valuable than the other, so should that also impact the evaluation score? It is also difficult to evaluate before it’s implemented.
For instance, if an organisation was to promise health and wellbeing improvements as part of the service offered it would be a challenge to monitor and report back on effectively.
These issues again demonstrate the challenges facing precedent processes. The ideal is to extend opportunity with a free, open, level playing field that allows companies to demonstrate the expertise and ability to deliver a service at a particular cost. The introduction of criteria that are woolly and impossible to judge without bias, can only serve to challenge that ideal.
Ultimately, the consensus in the procurement sector is that introduction of such subjective criteria sets dangerous precedent.
Penny Godfrey is general manager of Millstream
Procurement specialist Millstream provides a public sector tender alerts service, Tenders Direct, to private sector organisations working across different industries. For more insights or top tips on expanding into the public sector visit www.tendersdirect.co.uk