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As a report from the regulator suggests that some of England’s larger housing associations are failing to report value for money properly, consultant Steve Smedley looks at where some of them went wrong
Reporting value for money (VfM) is about transparency and accountability. It’s meant to stiffen the senses so the board and executive focus squarely on VfM.
The acid test is the extent to which stakeholders are able to understand and make a judgement about your VfM performance.
Based on the Regulator of Social Housing’s (RSH) assessment of larger housing associations, the majority of last year’s VfM reports failed this test and fall short of full compliance. We need to get it right (see box below).
VfM reporting is an opportunity to set out clearly what you do – the difference you make. Not crass PR, but factually stating the social and economic issues your strategic objectives address and the value of this to a range of stakeholders.
Many stakeholders, including those in government, don’t fully understand what you do and some are prone to exploit this ambiguity by unhelpful characterisation.
“Your reports can educate the public about the diversity of a modern social housing offer while risk-managing the vexatious”
Backed by objective data, there’s a compelling story to tell of how you really do join up people, places and partners to solve the complex individual and collective problems that stand in the way of well-being.
Your reports can educate the public about the diversity of a modern social housing offer while risk-managing the vexatious.
VfM reports should also be about demonstrating how you make the best use of finite resources in the pursuit of your clearly stated objectives. You can’t be all things to all people. Manage expectations by explaining essential context and the difficult trade-offs that frame the investment puzzle of how you maximise your objectives, not least of which is the safety and security of tenants.
So, where did we go wrong? Surely there’s been a misunderstanding? Well, yes. Just as bears frequent the woods, so too does befuddlement stalk VfM.
The current, more focused approach aimed to cut through the verbiage and variation of the old self-assessment by putting objective VfM measurement at its heart.
The problem is that too many associations think it’s enough to play back the RSH’s mandatory metrics alongside the Sector Scorecard with no reference to how these demonstrate delivery of their objectives.
This should come as no surprise. Only a few of these metrics are potentially about your objectives.
The rest are about the context, capacity and efficiency of the business processes that underpin those objectives.
In short, the sector isn’t measuring its product, although it can show its workings as to how it got there… wherever ‘there’ is.
“Too many associations think it’s enough to playback the RSH’s mandatory metrics alongside the Sector Scorecard with no reference to how these demonstrate delivery of their objectives”
You need metrics that reflect your objectives, some of which may be entirely unique to you and may already be sitting in your corporate scorecard. And here’s the uncomfortable part: you have to set targets against them.
Numbers, not fluffy words of good intent.
It’s the beneficial movement of such metrics over time that demonstrates improving VfM – arguably a more compelling way of capturing ‘VfM gains’ than cobbling together a list of procurement savings.
Metrics can never be the last word on your VfM performance – complemented by qualitative data, they’re a starting point for a story about value and how you’re maximising it.
And since it’s not a fairy story, some of it might not be pretty.
But that’s real life – you never promised anybody a rose garden. Everybody expects a little rain sometimes, especially the RSH, which gets to inspect your garden as well as read about it. It’s best to report the dead cat in the flower bed than let them find it.
Expect in-depth assessments to reach the parts that your VfM reports didn’t, and indeed, explore those elements of the standard that aren’t just about reporting but are concerned with embedding VfM in the fabric of the organisation. Arguably a stiffer test.
Steve Smedley, associate director, Acuity
Here is one way you could set out your VfM report:
Steve Smedley, associate director, Acuity
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