Procurement strategy: building resilience in Scotland’s social housing sector 

It’s been a demanding six months for procurement professionals across Scotland’s social housing landscape. While England, Wales and Northern Ireland adjusted to the Procurement Act 2023, Scottish housing associations and councils have continued operating under the Procurement Reform (Scotland) Act 2014 and Public Contracts (Scotland) Regulations 2015, a framework that already embeds many progressive principles the rest of the UK is only now adopting. 

Add to this the introduction of wide-ranging tariffs, ongoing geopolitical uncertainty and persistent inflationary pressures, and procurement teams north of the border are navigating complexity from multiple directions. 

On top of regulatory demands, teams face mounting pressure to support small and local suppliers, deliver meaningful social value aligned with the Sustainable Procurement Duty, and generate savings to fund vital new build programmes and building safety remediation. There’s genuine enthusiasm about these opportunities but also understandable apprehension about delivering on all fronts simultaneously. 

Against this backdrop, I’ve observed particular skills and approaches gaining traction. Those Scottish housing associations and local authorities refining their procurement tactics and introducing new capabilities, processes and thinking are finding ways to maintain effectiveness. Here are some important, and proven developments: 

Deploy AI thoughtfully to reduce administrative burden 

Artificial intelligence can streamline routine tasks, surface insights quickly and generate content, but adoption varies considerably across Scotland’s social landlords. 

In some procurement functions, AI usage remains sporadic, depending on individual staff members’ digital confidence and capability. However, the most effective outcomes emerge from planned, consistent approaches to deploying AI for defined purposes. 

Developing specifications: One practical starting point is specification drafting. With well-crafted prompts, generative AI can help outline requirements for products or services. However, proceed with caution – automated specifications may not satisfy legal or compliance standards, particularly under Scottish procurement regulations, so safeguards and human review remain essential. 

Drafting contract notices: AI is proving useful for creating contract notices for Public Contracts Scotland. With the Sustainable Procurement Duty requiring considered thought about economic, social and environmental wellbeing before every procurement, AI can help articulate these considerations consistently across multiple opportunities. For teams managing numerous contracts, this represents a significant efficiency gain, releasing capacity for more strategic work. 

Evaluating tender responses: AI can support procurement teams during bid assessment, helping analyse supplier submissions to highlight key information and insights that inform decision-making. 

Supplier bid preparation: Suppliers increasingly use AI to develop tender responses. This particularly benefits SMEs with limited resources or tendering experience, helping them compete more effectively. However, generic, templated submissions may lack specificity. Procurement teams must sharpen their ability to identify AI-generated content and ensure bids demonstrate genuine understanding of housing sector requirements. 

Resource and prioritise contract management properly 

Within social housing, procurement teams typically tender contracts, but ongoing contract management often falls to service leads already juggling competing priorities. 

This can result in missed opportunities, diminishing value across a contract’s duration, and underperformance that continues unchallenged. Research by World Commerce & Contracting suggests poorly managed contracts cost organisations an average of 9% of annual revenue through ‘value leakage’. 

The Scottish Housing Regulator’s scrutiny of governance and financial management makes robust contract oversight increasingly important for demonstrating effective stewardship of resources. 

Speaking with dozens of Scottish housing providers weekly, those successfully maintaining the value established during tender evaluation share certain foundations: 

Robust, collaborative supplier relationships: Identify your strategic suppliers and invest time building balanced, transparent partnerships with effective communication channels. 

Clear monitoring and performance improvement frameworks: Define roles and responsibilities for contract management explicitly and establish straightforward reporting mechanisms. 

Capability development for service managers: Those responsible for contracts don’t always have supplier management experience, so building confidence and developing competencies yields substantial benefits. 

Establish procurement as a compelling career choice 

Attracting top procurement talent has become increasingly challenging across Scotland’s public sector, and social housing proves no exception. With demand and salary expectations higher than I’ve witnessed in many years, procurement functions across councils and housing associations must position themselves as strategic, innovative and fulfilling career destinations. 

This means demonstrating procurement’s tangible impact on communities and residents’ lives – a genuine differentiator from private sector roles. It also means looking beyond procedural competence. Today’s procurement professionals need to understand markets thoroughly, constructively challenge suppliers, and contribute meaningfully to strategic decision-making. 

Housing providers that articulate procurement’s wide-ranging value proposition will better position themselves to attract and retain exceptional talent. 

Engage local suppliers authentically 

Small businesses are fundamental to local economies, and Scottish social landlords face growing expectations to make opportunities genuinely accessible. The Procurement Reform (Scotland) Act 2014 reinforces this through its Sustainable Procurement Duty, which explicitly requires consideration of how procurement can facilitate SME, third sector and supported business participation. 

Scotland has led the way with initiatives like Public Contracts Scotland’s Quick Quotes system for lower-value opportunities, making it easier for smaller firms to identify and respond to opportunities. 

However, real progress comes from daily decisions. Are your contracts structured to allow smaller organisations to compete effectively? Are templates and processes straightforward to navigate? Are you engaging local suppliers to understand what facilitates – or hinders – their bidding capability? 

Market engagement proves vital. Ask suppliers what they need and remain open to adjusting approaches. Whether through lot structures that allow smaller firms to bid for manageable portions of work or providing clearer guidance on requirements, modest adjustments can create significant impact. 

The Scottish Government’s Fair Work First policy, integrated into procurement requirements for regulated contracts above £4 million, provides another opportunity to work constructively with suppliers on employment practices that benefit workers and communities. 

Analyse cost drivers and prepare scenarios 

When suppliers seek price increases, procurement managers navigate the consequences. Understanding your supply chain’s cost structure becomes crucial. Empathise with supplier pressures, but don’t accept price rises uncritically. Request evidence and conduct independent research. 

For construction materials, for instance, investigate whether products are energy-intensive to manufacture and whether high shipping costs have affected them. Scottish housing associations undertaking remediation work should understand how tariffs on imported building materials might impact costs. 

Scenario planning is critica, prepare for multiple eventualities. Recent years have demonstrated how difficult predicting future events can be. This necessitates preparing for contrasting scenarios and everything between them. 

Navigate Scotland’s evolving regulatory landscape 

Scottish housing providers operate within a distinctive regulatory environment. The Sustainable Procurement Duty requires consideration of economic, social and environmental wellbeing before every procurement, a requirement that’s now being mirrored in the rest of the UK through the Procurement Act 2023. 

This positions Scotland’s housing sector advantageously. While organisations elsewhere adapt to new requirements, Scottish providers have years of experience embedding these considerations into procurement planning. However, this advantage only materialises when teams genuinely engage with these duties rather than treating them as administrative exercises. 

The Scottish Housing Regulator’s engagement plans and regulatory assessments increasingly examine procurement governance, making robust, well-documented procurement practices more important than ever for demonstrating effective organisational management. 

For those Scottish housing providers accessing UK-wide framework agreements established under the Procurement Act 2023, additional considerations emerge. When calling off from these frameworks, Scottish organisations must comply with the new UK regulations governing those arrangements – a dual regulatory environment that requires careful navigation. 

Build sustainable foundations 

Procurement teams across Scotland’s social housing sector are adapting continuously. However, those making genuine progress aren’t pursuing trends – they’re building robust procurement foundations with accountable and disciplined contract management, equitable and transparent supplier relationships, investment in technology and people, and thorough understanding of critical markets. 

Scotland’s progressive procurement framework, with its emphasis on sustainable procurement, community benefit and fair work, provides a strong platform. The challenge lies in operationalising these principles effectively while managing immediate pressures. 

Those succeeding are treating procurement not as a transactional function but as strategic capability that directly influences organisational resilience and community impact. They’re developing procurement professionals who understand Scotland’s unique regulatory landscape, can navigate relationships with suppliers of all sizes, and contribute meaningfully to organisational strategy. 

In an environment of persistent uncertainty, these foundations matter more than ever. 

Guy Stapleford is head of consultancy services at Procurement for Housing Scotland (PfH Scotland)