Over the past few years, diversity and inclusion have been conventionally treated more as an HR priority than as a board-level, strategic priority. However, the social justice events of 2020 helped catapult conversations around diversity and inclusion among decision makers and consumers. Going forward, the commitment towards diversity and inclusion is expected play a critical role in shaping stakeholder trust for an organization.
As companies began to reevaluate their diversity goals, or establish new ones, challenges arise on just how to successfully diversify their supply chains and track these new diversity goals. Additionally, finding diverse suppliers that meet a company’s specific requirements can also be challenging.
Why diversifying suppliers is good for business
Diverse sourcing of suppliers is both a social and business imperative that can help drive supply chain resiliency as well as ESG goals. Creating diverse and inclusive supply chains can:
Unlock innovation — introduce you to new products, services, and solutions, and expand your range of procurement channels for goods and services
Provide access to new markets — open new opportunities for business expansion by highlighting new consumer needs driven by shifting demographic trends
Lower costs — lower buying operations costs compared to companies without supplier diversity programs
Increase ROI — Research has shown that diversifying your workforce generated a higher ROI than companies with a less diverse worker population. In fact, a study by the Atlanta-based Hackett Group that companies with a strong supplier diversity focus generated a 133 percent greater procurement ROI than the average comparable business, generating an additional $3.6 million to their company’s bottom line.
How can I diversify my supply chain?
Using a management tool that provides you with a holistic view of your compliance framework can help you manage a diverse range of suppliers.
Avetta One is the industry’s largest Supply Chain Risk Management (SCRM) platform. With the platform, companies can search, source, and connect with suppliers with varying levels of diversity and inclusivity from the world’s largest network of qualified suppliers across North America, Central and South America, APAC, and EMEA.
Avetta One can help you:
Locate Diverse Suppliers: The Avetta One platform comes embedded with 25 diversity filters where you can locate and connect with suppliers committed towards diversity and inclusion.
Leverage Detailed Diversity PQFs: Our solutions come with pre-built prequalification forms (PQFs) that helps companies accurately track supplier diversity information such as minority ownership, veteran ownership, women ownership, disabled ownership, LGBT ownership, and small businesses.
Harness Analytics: With Avetta One, you’re able to aggregate all the supplier prequalification data to generate analytics reports to help visualize your supply chain diversity.
Sourcing from diverse suppliers is a social imperative that’s also good for the top and bottom line and your ESG goals. As a business imperative, decisions can be often swayed when businesses are able to demonstrate and articulate their diverse sourcing policies and showing how your company is serious on social commitments to its broader ecosystem.