In recent times, a lot of businesses all over the world are not just embracing the idea of hiring diversely; they are also beginning to see reasons why company procurements should be made from a wide variety of diverse suppliers and vendors. This stems from the need to address racial injustice, reduce discrimination and implicit bias within the organization, while driving up business growth rates.
Supplier diversity refers to a business strategy that allows for a diverse supplier base or a supply chain that incorporates businesses owned by diverse individuals or groups in its purchase of goods and services. A business where underrepresented groups such as small business enterprises, women based enterprises, minority owned enterprises, veterans, LGBQT operates at least 51% is known as a diverse supplier.
The idea of having an effective supplier diversity program in an organization has evolved. Supplier diversity goes beyond mere corporate social responsibility undertaken to boost the image of the company. It has proven to be a strategy that allows an organization to expand its business frontiers in new and developing communities while accessing opportunities to procure innovative products.
Dennis Ford of Cummins Inc in describing the importance of supplier diversity programs said:
“…businesses owned by diverse suppliers help contribute to the overall economic growth and well-being of the communities in which we live and work. We also understand that establishing strategic partnerships with our suppliers helps create value for our customers and provides us with a competitive advantage. Collaborating with such businesses to provide goods and services to our company creates a cross-cultural competency that only comes from multiple perspectives.”
Here are three reasons why your business needs a supplier diversity program:
1. It promotes innovation
Supplier diversity allows a business access to a large pool of diverse thoughts, information and solution-proffering that encourages innovative ideas for the organization. This comes from the fact that an organization that has suppliers fromdifferent lifestyles, racial backgrounds and cultural orientations pooled together from the organization’s supply base, it allows for the generation of innovative ideas on procurement challenges that will prove efficient in business growth.
Innovation is important to strategic business models in today’s business world. This is because developing innovative processes through an effective supplier diversity program helps in the creation of a competitive business environment that can potentially reduce costs, resulting in lower and attractive prices.
2. It reflects good corporate values and ethics
Modern businesses are concerned about how consumers or clientele view their organization, as this has a huge impact on the business’ growth. Organizations with good supplier diversity program where diverse suppliers are given equal opportunities without discrimination, portrays an image of a company that has a robust diversity, equity and inclusion at the core of its businessstrategy. This in turn makes it attractive to potential consumers, employees or clients.
In general, a supplier diversity program effectively fits into efforts of an organization to develop high moral grounds and standard of operation.
3. It has a great overall positive impact on society
The society benefits a great deal from supplier diversity programs in instances where organizations under the auspices of the initiative develop mentoring and training programs that bolster the growth and success of businesses of diverse suppliers.
The said interventions could include training workshops, professional matchmaking at supplier diversity conferences, enhancing opportunities for capital investment, etc.
Statistics from The National Minority Supplier Diversity Council indicates that businesses that fall within the definition of diverse suppliers make valuable contributions to the creation and preservation of jobs. The said reports indicate that 2.2 million jobs were created while $49 billion was made in annual revenue for local, state, and federal tax authorities.
So, there is no gain saying that supplier diversity programs have become a must have in the DEI portfolio of organizations who place value on not only racial justice but also seek to be able to partner with choice businesses. This is because organizations prefer to partner with businesses that have same corporate values as theirs, especially in terms of diversity.
If you are interested in creating an effective, unique and innovative supplier diversity program, then Thinkzilla consulting team in Scottsdale, Atlanta, and Houston will design and implement a program that fits perfectly into your company’s budget and projections.
Click here to learn more about how Thinkzilla can create a world-renowned program for your organization. Our experts are standing by.
