How Does a Supplier Diversity Program Work?
5 Actionable Steps for Your Business
A Supplier Diversity Program is a dynamic business program intended to support and encourage the use of the following types of businesses: minority-owned business, veteran owned business, women-owned business, LGBT-owned business, businesses that are historically underutilized or recognized, and small business suppliers defined by the Small Business Association.
The supplier diversity program is one of the most important initiatives that a business can undertake. It’s an opportunity to provide better service for customers and increase revenue at the same time. However, the first step is to find qualified suppliers to create a diverse pool of potential partners. This blog post will discuss the following five actionable steps for your business when it comes to supplier diversity programs.
Identify Supplier Diversity Goals
The first step is to identify supplier diversity goals. This is important because goals help keep your program focused and on track. For instance, if you want to increase revenue by 20% in the next five years with supplier diversity programs, then this goal will be more likely achieved through an actionable plan that includes measurable benchmarks for success.
Conduct Market Research
Next, an organization should conduct market research . This research will help you to identify the needs of your community and customers. It is important that this includes supplier diversity inclusion on your team so they can make informed decisions about what your program should do.
Ensure There Is Enough Inclusion On Your Team To Implement A Program
Supplier diversity programs help an organization improve its brand image and competitive advantage. More opportunities include cultivating customer loyalty, expanding the value chain, driving more new revenue, and identifying more new diverse markets with multiple segments.
Develop An Action Plan With Clear Measurement And Accountability Metrics For Successful Implementation Of The Diverse Supplier Program
Develop an action plan with precise measurement and accountability metrics for success. The more well-defined the goals are, the better chance there is for them to be accomplished – even if it means rethinking or changing a plan to reach it. Make sure anyone who participates knows how their work contributes towards achieving these goals and which processes need improvement/revisiting (e.g., communication).
Communicate Clearly – Be Transparent About What You’re Doing When It Comes To Working With Diversity Suppliers
Communicate clearly. Be transparent about what you’re doing when it comes to supplier diversity programs by including stakeholders up front. The three main business drivers that influence supplier diversity include changes in markets and competition, and the fact that success depends on strong national economies.
Companies that use the diversity supplier program demonstrate their leadership and commitment to effectively manage their diversity suppliers while working to increase their numbers.
The system provides your organization with accurate and timely reports that provide senior leadership with the necessary facts to make sound business decisions and plans for the purchase of services and products.
Working With Supplier Diversity Programs
All industries in the North America, starting in the state’s seven largest urban areas, will be encouraged to participate in the following manner:
Agree to participate in fostering greater use of minority and women owned businesses as tier one or tier two suppliers
Agree to participate in ongoing outreach to minority and women owned businesses
Participate in the system of reporting, auditing, and tracking which includes validation of their reporting dollars in the use of minority and women owned businesses
Where appropriate participate with other similar industries or sectors in order to take advantage in natural synergy
Agree in efforts to increase business opportunities for minority and women owned business by using a system that actual validates their expenditures
Supplier Diversity Program Participation
Companies will participate in the following process:
All companies register into a common auditing, reporting, tracking and validation system
Purchasing companies report all purchases from minority and women owned companies
All minorities and women should be certified by one of the certifier bodies
Agree to permit distribution of monthly, quarterly, and annually reports to various relevant and interested parties
The supplier diversity program system enables diversity categorized suppliers to have the ability to support and strengthen their business relationships with all other diversity suppliers while working together to achieve the company’s mission, vision, and diversity strategy.