Supplier diversity is a buzzword. But it’s often misunderstood. What’s worse, at first glance it can come across as a DEI (diversity, equity, and inclusion) initiative that, while honorable, will drain your company’s resources.
For most enterprises, though, that couldn’t be farther from the truth. On the contrary, by embracing supplier diversity, you can tap into a variety of benefits that can breathe a new feeling of life and innovation into a company.
IBEX IT Business Experts have recently launched a proprietary supplier diversity management system called Certifiably Diverse. Certifiably Diverse is a cloud-based supplier diversity management software designed to provide customers with a secure, scalable, flexible, and value-based enterprise diverse supplier management solution.
Here is a brief definition of supplier diversity as well as a few of the positive ways that it can impact your company.
What Is Supplier Diversity?
It’s important to understand supplier diversity before addressing its benefits. After all, this isn’t a quick adjustment to a business process or a memo sent out to your staff. It’s a revolutionary approach to a company’s supply chain that can have a profound impact on future success.
Not surprisingly, supplier diversity focuses on the supply chain of an enterprise. It incorporates a diversified base of suppliers that hail from a variety of different groups and cultures.
In other words, supplier diversity is a business strategy that works to create a diverse, inclusive supply chain filled with experienced and highly qualified businesses owned by minorities and other underserved and underrepresented groups within a society.
Embracing supplier diversity can be a great complement to other DEI initiatives. While these often focus on siloed aspects within a company, extending the focus on diversity, equity, and inclusion (DEI) externally can yield many benefits.
Even better, the process of shifting to a diverse supply chain doesn’t have to be complicated. There are management solutions like cloud-based organizations that can streamline the activity.
Certifiably Diverse allows corporations to easily manage their supplier diversity programs and transform supplier diversity commitments into bonafide reality via a results-driven, scalable platform. While companies like this make the transition to supplier diversity easy, the benefits of the strategy only increase from there.
The Benefits of Supplier Diversity
It’s easy to grasp the understanding and implementation of a supplier diversity initiative. However, knowing the logistics doesn’t make it an automatic business decision.
If you’re considering steering into supplier diversity, here are a few of the biggest reasons you should take the leap.
Promotes Innovation
Modern businesses thrive on innovation. Technology is always changing. Consumer interests are also in a state of evolution at all times.
With this kind of business environment, it’s important for companies to take innovation seriously. Supplier diversity is one way to do that.
Suppliers — especially diverse suppliers — tend to be small businesses. They usually operate with a flexible, adaptable mindset that can be crucial to their success. By working with these vendors, you also open yourself up to their creativity.
Certifiably Diverse has a powerful search engine that makes it simple for Corporations and their buyers to easily search businesses based on their certification statuses, products and service, and economic impact goals.
The recent disruption in global supply chains due to the coronavirus is a great example of how fragile the supply chain system can be. By building a network of diverse, creative suppliers, you can let their innovation impact your various business solutions and even, by extension, your products and services.
Improves Social Responsibility
It’s no secret that supplier diversity can be a wonderful way to embrace corporate social responsibility (CSR) initiatives.
As already mentioned, often CSR activity — and particularly DEI (diversity, equity, and inclusion) strategies — can feel inwardly focused. Corporate culture and hiring are often prime targets.
By extending your CSR activity beyond the four walls of your inner sanctum, you can build on that internal integrity.
For example, by creating a diverse supply chain, you can support small businesses and add to their economic value. This can help remove some of the barriers to entry that many of these organizations face by operating as underrepresented or underserved groups.
This also leads to further trickle-down benefits to their employees, communities, and so on.
Enhances the Stability of a Company
Another way that supplier diversity can impact your company for the better is through stability. By embracing this approach to your supply chain, you open yourself up to more supply channels. You can source goods and services from a wider pool of candidates, which creates a greater sense of security during difficult times.
Embracing a supplier diversity strategy can also impact the mindset of your workforce. For example, Harvard Business Review shared a report claiming that 52% of employees surveyed said they wanted to work for a company with supplier diversity. By emphasizing your diverse supply chain, you can open up the doors to a larger, more committed workforce and, by extension, a healthier company culture.
Boosts the Bottom Line
Not surprisingly, adopting a business supplier diversity program can also directly translate to dollars and cents. This can come from a few different angles.
For instance, by widening the market of options for your vendors, you can ramp up the competition. This can ensure that you’re getting the best prices and service between both existing and new vendor options.
It can also help you stay in touch with shifting demographics. As the consumer population changes its defining factors and interests, a diverse supply chain can help you stay in touch with your audience.
The numbers bear all of this out, too. According to market research firm Hootology, its data reveals that consumers who see a brand committed to diversity are almost four times more likely to consider the company for their needs. As a result the likelihood that they’ll patronize the brand also triples.
Implementing Supplier Diversity
The world is a diverse place, and it’s important that this is reflected in your company. This is true both inside and outside of your operation.
So, along with DEI initiatives aimed at diversifying your workforce, also remember the importance of a supplier diversity strategy. By diversifying your vendors, you can find several ethical and economic advantages that are too important to pass up.
