Diversity and inclusion are hot topics today. This has never been truer for business procurement. 

Diversity Matters
More companies are stepping up their game with initiatives that encourage using minority-, women-, veteran-, and LGBTQ+-owned businesses as suppliers. And for good reason. With diversity comes stronger thinking. Supplier diversity is also a smart business strategy that ensures a diverse supply chain when it comes to procuring goods or services for any government or private organization. 

According to Harvard, 20 out of 24 clients have some level of focus on supplier diversity. Take UPS, for example. The company currently spends $2.6 billion annually doing business with roughly 6,000 small and diverse suppliers—and plans to bump up that number year over year.¹

 


Why Your Company Needs a Supplier Diversity Program
Not only does it promote the desire for a more equitable world, but supplier diversity encourages the growth of traditionally under-represented businesses. This helps create jobs and tax revenue in local economies and communities. 

Beyond that, inclusive supply chains expand the pool of potential suppliers and promote innovation by introducing new products and ideas. 

Potential Roadblocks for Procurement Teams
Maybe you want to do your part and increase your spend with diversity organizations. But it can be difficult to know where to begin. You have to be able to find the right suppliers for your business. And when you do, you need to be able to quickly connect. All this takes time and you’re on tight deadlines. 

With the right partner, setting up a successful supplier diversity program is a lot easier than you might think. Consider these five simple steps to help you get started:

How to Build a Successful Supplier Diversity Program

Step 1 – Determine your goals

First decide your goals. Want to quickly find diverse suppliers that match your criteria? You need access to quality data that says whether suppliers are diverse, their certifications, and other self-reported information. Or maybe your procurement team wants to track and report on diverse suppliers that you already work with. You still need to be able to quickly access that data.

All this is very easy to do in the graphiteConnect platform. We collect and manage an expansive list of suppliers. During the on-boarding process, diversity status is established and information is continuously updated over time. Baseline reporting is a snap—you can easily see how much you’re spending with different businesses.

Step 2 – Infuse diversity into your company culture

Creating an inclusive workplace culture starts from the top down. Your company’s executive team must desire to build a diverse culture and hire employees who are open to working with people of different nationalities, skin colors, genders and sexual orientations. 

As a purchasing leader, it’s important for you to make sure that you have executive sponsorship for what you’re trying to accomplish. Decision makers need to believe it’s their job to do good and be inclusive in their spending. All employees who are purchasing services or products need to be able to easily find diverse suppliers. Once your company’s leadership sets the tone, it’s easy to extend that outlook throughout your organization.

Step 3 – Build awareness through communication

You have to invest in this cultural change to get employees to buy-in to it. Efforts should allow for cross-team collaboration, with management in charge of educating employees about the importance of making this shift.

Distribute information about your diverse supplier initiative throughout the organization. For example, consider creating an internal marketing campaign that highlights the importance and benefits of the program.

Step 4 – Choose one or two spend categories to focus on

When it comes to finding diverse suppliers, decide on a couple of spend categories that will make an immediate impact. For instance, maybe you want to start with marketing or financial partners. 

The graphiteConnect platform allows you to filter and search for the best diverse suppliers based on your unique criteria, whether you’re looking for veteran- or female-owned businesses. Or you can quickly create an “Opportunity” for suppliers to find and apply to work with you. 

Step 5 – Identify and make the most of your wins

Analyze and identify what has worked and then continue to do what works, growing your supplier diversity program from there. As your efforts start to gain traction, build success stories around these experiences. You can post and share these stories through the Graphite network to show the value your partnerships with diverse suppliers bring to the business.

Unlock More Hidden Opportunities with graphiteConnect
Relying on manual processes to match buyers with suppliers is an inefficient method of the past. That’s why graphiteConnect has created a two-sided network that simplifies the way buyers and suppliers connect and transact with each other. 

Creating an equal playing field
The graphiteConnect platform provides an open and equal playing field that offers disadvantaged and smaller companies an opportunity to win the business. It allows organizations to build their cultures around inclusion and empowers diverse suppliers to “up” their game by joining an expansive network. 

Building a community network
Businesses can openly post what they’re looking for to an entire online community. For example, buyers can open a search and let organizations within the network know what they’re looking for. Suppliers can browse and apply for those opportunities that fit their strengths and capabilities.

Driving better communication and transparency
This centralized, all-under-one-roof procurement tool offers you greater visibility and control over spending. We take care of supplier vetting with a painless onboarding process that simplifies data collection and makes overseeing vendor management easier for you.

Diversity opens the door to new perspectives and ideas. As a result, your business will benefit from a higher level of innovation and creative problem-solving. “These businesses will bring in new technology and ways of thinking that you didn’t even know was available,” said Smith.

When you’re ready, graphiteConnect can help you set up your own supplier diversity program and simplify the entire procurement process. For a free demonstration, please contact us at

References:¹ Harvard Business Review. “Why You Need a Supplier-Diversity Program.” August 17, 2020.
https://hbr.org/2020/08/why-you-need-a-supplier-diversity-program

Background

HealthEquity is a Utah-based healthcare benefits and financial services company in the FinTech industry. As part of its risk management efforts, the company must evaluate all suppliers for data privacy and information security compliance. 

Challenge

When HealthEquity’s supplier base nearly doubled, the company needed a more efficient way to manage and monitor its growing supplier base.



Pain Points

  • Data living in different systems and programs
  • Outdated, often inaccurate supplier data
  • Low visibility into the supplier base
  • No cross-team communication 
  • Limited due diligence process

Goal

HealthEquity sought a complete solution that could connect all the necessary teams, offer visibility across the entire procurement process, and help clean up the data. 

Results

  • Greater visibility and reporting to leadership
  • Cleaner data, reduction in duplicates and inaccuracies
  • Ability to pinpoint high- and low-risk suppliers 
  • Identify bottlenecks and make necessary changes


Learn how graphiteConnect helped HealthEquity streamline day-to-day tasks, including:

  • Contract management
  • Reporting
  • Supplier onboarding
  • Risk management