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Your company’s supplier diversity is lacking. How can you fix it?

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Supplier diversity is the practice of sourcing goods and services from a diverse range of suppliers, such as women-owned, minority-owned, veteran-owned, or LGBTQ-owned businesses. It can bring many benefits to your company, such as innovation, cost savings, social impact, and customer loyalty. However, if your company’s supplier diversity is lacking, you may be missing out on these opportunities and risking your reputation. How can you fix it? Here are some steps you can take to improve your supplier diversity program.

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Alok Kumar Gupta

Consultant - TQM Practices - Freelance, self-employed

1 Assess your current situation

The first step is to evaluate your current supplier base and identify any gaps or areas for improvement. You can use tools such as spend analysis, supplier diversity audits, or supplier surveys to collect and analyze data on your suppliers’ ownership, certification, performance, and satisfaction. You can also benchmark your results against industry standards or best practices to see how you compare to your peers and competitors.

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Dorte Stürmer-Brauer

Gesch?ftsführende Gesellschafterin bei Kardeel Consulting UG | Diplomkauffrau
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Guten Tag, vielen Dank für diese Einladung. Wir haben jedoch keine mangelnde Lieferantenvielfalt bei uns im Unternehmen. Aus diesem Grund kann ich hier keinen sinnstiftenden Artikel anbieten.

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2 Set clear goals and metrics

The next step is to define your supplier diversity goals and metrics that align with your company’s vision, mission, and values. You can use the SMART framework to make your goals specific, measurable, achievable, relevant, and time-bound. For example, you can set a goal to increase your spend with diverse suppliers by 10% in the next year. You can also use key performance indicators (KPIs) to track and measure your progress and impact, such as the number of diverse suppliers, the percentage of diverse spend, or the return on investment (ROI) of your supplier diversity program.

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3 Implement a supplier diversity policy

The third step is to establish a supplier diversity policy that outlines your commitment, expectations, and guidelines for your supplier diversity program. You can use your policy to communicate your goals and metrics, your procurement process and criteria, your supplier development and support initiatives, and your reporting and accountability mechanisms. You can also use your policy to educate and engage your internal and external stakeholders, such as your employees, managers, customers, and partners, on the importance and benefits of supplier diversity.

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4 Leverage supplier diversity software

The fourth step is to use supplier diversity software to automate and streamline your supplier diversity program. Supplier diversity software can help you find and verify diverse suppliers, manage and monitor your supplier relationships, analyze and report your supplier data, and optimize your supplier performance. Supplier diversity software can also help you integrate your supplier diversity program with other systems and platforms, such as your enterprise resource planning (ERP), your customer relationship management (CRM), or your sustainability reporting.

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5 Evaluate and improve your program

The final step is to review and improve your supplier diversity program on a regular basis. You can use feedback, surveys, audits, or reviews to assess your program’s strengths and weaknesses, challenges and opportunities, and risks and rewards. You can also use best practices, benchmarks, or case studies to learn from other successful supplier diversity programs and adopt their strategies and tactics. You can also use innovation, collaboration, or recognition to enhance your program’s value and impact.

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Alok Kumar Gupta

Consultant - TQM Practices - Freelance, self-employed
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Well firstly we should be clear on as to why we want to diversify in factual past experience and future challenges. Then secondly we need to understand and evaluate carefully as to where we should diversify. After that we can put our team to get into action for adding vendors to our present base . Remember that wherever we are going to add vendor, to keep present vendor motivated and committed will also be a challenge which we need to address. Many places even without diversifying, vendors can be made more motivated and they start sharing the future goals as partners. Hence we need to be careful while looking at diversification in the vendor base. A committed small base of vendors is more better than the diversified broad base.

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6 Here’s what else to consider

This is a space to share examples, stories, or insights that don’t fit into any of the previous sections. What else would you like to add?

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Your company’s supplier diversity is lacking. How can you fix it?

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1 Assess your current situation

2 Set clear goals and metrics

3 Implement a supplier diversity policy

4 Leverage supplier diversity software

5 Evaluate and improve your program

6 Here’s what else to consider

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