Supplier Diversity For Dummies. Kathey K. Porter
and employee resource groups (ERGs)
Formal mentoring programs
New methods of engaging and leveraging all employees’ knowledge and skills
More transparent paths for employees to succeed within a company and the leadership structure
Expanding for equity
In recent years, diversity and inclusion initiatives have expanded to include equity. Equity focuses on ensuring that everyone has just and fair access to the same information, opportunities, and environment regardless of their experience or specific social position. Each person has unique needs, advantages, and barriers; everyone starts from a different place, so everyone needs different resources to level the playing field. To be successful, inclusive environments require equal access and fairness. Equity enhances inclusion and looks at systemic issues that allow inequality to continue.
A NEW SENSE OF URGENCY: PUTTING THE FOCUS ON SUPPLIER DIVERSITY AFTER THE GLOBAL PANDEMIC
I started this project when the world was facing some of the most unparalleled and disruptive events in history — the COVID-19 pandemic and the social unrest sparked by the murder of George Floyd. The world as we knew it came to a halt, with businesses and schools closing and operations shifting to a virtual environment. Groups used this time not only to protest for social reforms but also to demand access to increased economic opportunities.
The death toll from the global pandemic was devastating with the effects still being felt. From an economic perspective, some businesses were able to adapt to this shift to virtual, work-from-home orders, or limited staff. Many, particularly small and diverse businesses, were not and were among the hardest hit. According to CBS News: “There were more than 1 million black-owned businesses in the U.S. at the beginning of February 2020, according to research from the University of California at Santa Cruz, which drew from census survey estimates. By mid-April, 440,000 black business owners had shuttered their company for good — a 41 percent plunge. By comparison, 17 percent of white-owned businesses closed during the same period, the UC Santa Cruz research shows.”
This was a tipping point, where organizations began looking internally at how they could step up and support, putting supplier diversity squarely in the middle. With supplier diversity professionals, there was a renewed sense of urgency to create creative solutions that would have a lasting impact. Global organizations announced financial commitments, pledged resources, and opened their doors to diverse businesses like never before. The year 2021 was definitely a defining moment in supplier diversity work to get small and diverse businesses back to work.
Diving into Their Different Audiences, Tactics, and Results
As a department or even a strategic initiative, diversity programs are still relatively green when compared to other functions within an organization. Despite diversity’s auspicious start during the 1960s, for many years it languished and wasn’t always embraced, welcomed, or even understood. But during the 1970s and 1980s, it became clear that the focus on diversity wasn’t going away. Organizations had to quickly get intentional about their commitment, develop strategies that worked, and create programs that could have a lasting impact on their communities.
Understanding the key differences in supplier diversity and DEI programs helps you balance and use them collaboratively and complementarily to avoid hyperfocusing on one area and neglecting the other. The following sections break down a few of these major differences.
Customers/target audience
DEI focuses on recruiting and fostering a culture of inclusion for current and future employees regardless of ethnicity, gender, age, disability, sexual orientation, religion, nationality, or educational level. DEI may also focus on niche groups within the organization that may have historically been overlooked, such as parents that are adopting or fathers that want to take paternal leave. These groups have a tremendous voice in shaping the benefits that an organization offers its employees.
Supplier diversity focuses on developing and nurturing the contracting relationship with suppliers, vendors, and consultants that have been historically marginalized and excluded from business opportunities because of ethnicity, gender, sexual orientation, and veteran status.
Tactics used
Supplier diversity and DEI deploy different methods to appeal to their target audiences. Because internal feedback is so important to the culture-building process, DEI directs its efforts primarily in the internal environment. It may deploy a combination of methods including recruitment fairs, ERGs, and climate surveys to direct its program efforts.
Supplier diversity uses a combination of external and internal efforts to achieve its results. Because it’s targeting small and diverse businesses from the community, it participates in outreach events and conducts workshops and training, all directed at the external community. It may even use councils of external small and diverse businesses and other community stakeholders. Internally, it works with employees, senior leaders, and allies to help them understand supplier diversity and encourage them to buy from small and diverse vendors.
Measuring results
DEI and supplier diversity use varying metrics to demonstrate their value and measure success. The types of instruments they use definitely overlap, but ultimately, it’s a bit like comparing apples to oranges. They’re both fruit, but they taste totally different.
DEI may focus on the number of hires, efforts taken to accommodate specific groups, the number of new initiatives that recognize and celebrate different nationalities, the creation of programs that create a pipeline to senior leadership positions, and so on.
With supplier diversity, spend and utilization with small and diverse vendors are the most common metrics. And, for a long time, they were the standard metrics. With the heavy investment in supplier development, supplier diversity today may look at the number of small and diverse businesses responding to solicitations, the award and project completion rates for small and diverse business, the conversion rate for workshop attendees becoming actual vendors, the number of repeat awardees, whether contract awards are increasing or decreasing, and so on.