In this episode, Michelle discusses the crucial topic of supplier diversity as an effective way to extend DEI principles beyond the internal workings of an organization and into the community. Michelle outlines six key areas to consider when developing a supplier diversity program: mission and principles, KPIs and spending, sourcing and onboarding, support and development, tier 2 suppliers, and governance. By focusing on these areas, organizations can better align their supplier diversity efforts with their overarching DEI goals, ensuring meaningful and measurable impact.

Michelle also highlights the importance of aligning with suppliers who share similar values and encourages tracking current spending patterns to set achievable goals. She also discusses the need to support and develop long-term relationships with diverse suppliers, potentially turning them into strategic partners. Resources and organizations like the Billion Dollar Roundtable, the National Minority Supplier Development Council, and numerous chambers of commerce are recommended for organizations seeking guidance on supplier diversity.

To learn more or connect with Michelle, visit: https://www.equity-at-work.com/

Key Topics Discussed:

• Introduction to Supplier Diversity
• Definition of Diverse Suppliers
• Importance of Supplier Diversity
• Key Areas to Consider in Supplier Diversity Strategies
• Resources and Organizations for Supplier Diversity:
• Guidance on Implementing Supplier Diversity Initiatives

I'm Michelle Bogan, founder and CEO of Equity at Work, and this is your DEI Minute, your go to podcast for leaders looking to navigate the ever evolving landscape of diversity, equity, and inclusion in the workplace. Whether you're just starting out with DEI or looking to sustain your long term successes, each episode will provide you with actions you can take to move DEI forward at your organization all in 15 minutes or less. In today's episode, we wanna talk about supplier diversity, which is a wonderful way to extend your DEI principles out into the community and use your dollars to uplift and have a wonderful impact on a variety of different people who are running you know minority owned or small businesses. So being intentional about your spend with suppliers can create great opportunities to extend your DI priorities and principles out into the broader community and there are 6 key areas to think about when you're incorporating DEI into your supplier strategy and I'm going to take you through a little bit of detail in each of these but to give you sort of the highlights mission and principles is the first then KPIs and spend the 3rd is sourcing and onboarding the 4th support and development the 5th is thinking about tier 2 suppliers and I'll explain what I mean by that in a minute and the final piece is governance And as an overarching frame for this supplier diversity or diverse suppliers really talk about anyone who's providing you with a product or a service outside of your organization in service to your organization. So if you think about accountants, you think about HVAC, if you think about janitorial supplies, if you think about, you know, boxes, about paper, business equipment, anything like that, any other kind of service or vendor or other supplies that your organization is using on a regular basis, any of those can fall into the supplier diversity umbrella. And there are different ways to categorize a supplier as being diverse. 1 is, are they minority owned and or operated? The second is, are they woman owned or operated? LGBTQ plus owned and operated? Disability, veteran. There are you know variety of different dimensions.

If you think about all the different dimensions that go into diversity those certainly are great things to think of. The other side that I've seen more and more people start to include in that is small business. Local businesses that are run by people who live in the community that you're operating your business in. So feel free to include those in your supplier diversity strategy. Any and all of those are wonderful to do. The other thing you'll need to think about is how important is it to you that they're owned versus owned and operated. Because a lot of times these suppliers will contract out to others, which may or may not also be diverse. So you'll need to just, you know, really think through that as as far as how you want to define supplier diversity for your organization.

So going back to the 6 areas to think about the first is mission and principles. So this is really saying, you know, the mission principles we defined, how well do those align with some of the suppliers and service providers that that we wanna work with. Do they have similar values to us? Do they have similar, you know, get back to their communities? Do they have a similar employer value proposition, employee value proposition, customer value proposition, etcetera. It's really looking at sort of a philosophical alignment of mission principles and values there. The second one is KPIs and spend. So what I really encourage people to do here is just start by measuring what you're spending today. A lot of people wanna jump right to, you know, what are my goals? What are the targets? What are other people doing? The reality is every company, even ones that have had a formal program in place for like, you know, 15, 20 years, people like IBM and Coca Cola, Walmart, that really helped define, you know, movement in this space a number of years ago. They don't necessarily have consistent, you know, targets that they're trying to meet across, you know, from company to company.

It really has to do with the spend that you do externally for goods and services and then starting to track what you spend today and how much of that today is spent on diverse suppliers as you define them. And then determining you know can we be more focused? Can we be more organized about this? More diligent about it? And then sort of ramping up those goals over time. And it also should fit with how you're reporting or tracking other DEI initiatives within your organization and making sure they align with those. If you are a public company and you have to report out regarding your ESG initiatives and progress, this is a great thing to include there. So, you know, if you're doing that as you're developing a diverse supplier program, make sure you're syncing up with your external relations or investor relations person on that reporting so that, you know, from the get go, the kinds of things you'll need to report out on. The third one is sourcing on a boarding. So this is really getting to like, how do I go find diverse suppliers? The good news here is there are a lot of organizations that do certifications of suppliers. You know, they're women owned businesses that get certified minority owned business, which is more about race and ethnicity, same with disability, veterans, etcetera.

Those are all great organizations. I'll share some of those at the end, some specific names, but those are all great organizations to tap into to find different diverse suppliers in your area, especially if you have multiple locations. They tend to have regional offices for certification and they can help you find local people. The onboarding component of this is how do you sort of help some of those businesses, especially because many diverse suppliers are also smaller businesses. How do you create access for them to come work with you? Make sure they have a clear process for sending in a bid and getting consideration. And then a lot of people now are also helping those organizations ramp up with you. So they may create a different set of terms to help those organizations come on board regarding payment or maybe insurance or there's sort of documentation that they've got to consider or create as part of this. And then many are also doing some kind of partnering or mentoring.

Maybe offering some training. Just, you know, particularly if you're a really big global organization, your procurement process may be a little bit intimidating or overwhelming for a smaller business. So if you can provide points of contact or maybe some education sessions, lunch and learns, round tables, things like that. Those can all be great ways to help source and onboard different suppliers. And many of the certification organizations are looking for people like you to partner with them at different events and provide access and and contacts. And they will make a make it very easy for you to work with them and help you sort of get synced up and in their system so that those connections can be made. The next is support and development. So again, sort of related to the onboarding, extending that into a long building a longer term relationship, and ideally getting some of those suppliers to become sort of strategic partners or strategic vendors for you which has a benefit to you of probably getting you know better pricing and better terms for them it's saying okay we're gonna sort of in kind help you develop a bigger profile maybe put you into you know a portal that's shared with other large organizations that use a similar portal to find people and plug people into different bidding opportunities, but really looking to elevate that into a strategic relationship.

The 5th element in here is tier 2 suppliers, and this is an area that's under greater and greater scrutiny as ESG reporting becomes a little more buttoned up and a little more scrutinized, particularly in the environmental space. We're looking and saying like, if we look at somebody's supply chain, you know, yes, you could have a diverse supplier. As I mentioned, some of those people subcontract out. The subcontracting contracting out then becomes the tier 2. So saying if I bring you on as a diverse supplier and you've got subcontractors are those subcontractors still in alignment with the same mission and principles the same metrics kind of just have the same general philosophy. Are they following the same rules and regulations around child labor, environmental impact, other areas like that? So just taking, you know, a little bit of a broader look at your sourcing supply chain to make sure all of those people all the way through the subcontractors do fall in line. If you're doing outsourcing for product or a more robust supply chain that can really be an important area to think about because there are so many people that get contracted out through those relationships. If you think of, you know, sourcing t shirts or handbags or shoes or, you know, other products like that, you're getting into a lot of overseas offices and a lot of different labor laws and other kinds of laws in place so you want to make sure that all of that really falls in line with what you're looking to have an impact on in your community and then the final piece is governance and governments always sounds you know a little bit boring and bureaucratic but really you know putting just some good principles in place around how you're going to operate do again you know really good reporting on that tracking metrics tracking impact all of that falls under governance if you're trying to then report out on the impact you're having starting with a view into governance is a great way to make that really easy for you on the back end.

So just putting some good policies, processes, you know, and other sort of norms and ways of working in place from the get go to make sure that, you know, you can really track your progress, track your impact, and create a way that a lot of those suppliers can be long term relationships that you develop, and some of them become really strategic partners for you. In terms of organizations and associations to reach out to, I'm gonna give you a variety of names of different ones that you can look into. The first is the $1,000,000,000 round table. The $1,000,000,000 round table is an organization of diverse owned and operated vendors and suppliers and service providers that have come together as an organization to help make this process easier for people, and also to do overall tracking of, you know, how the dollars are spent across the country and beyond with diverse suppliers. So that's a great one to tap into. There's also a book that they publish. I believe they have a website. There's also the National Minority Supplier Development Council.

There are a number of chambers of commerce that are specific to different minority groups and organizations. So there's this Hispanic one. There's a National Gay and Lesbian Chamber of Commerce. There's a Women's Business Enterprise National Council, which is similar to Chamber of Commerce. They also do certification a pan Asian American Chamber of Commerce and a National Veteran Business Development Council those are all terrific resources to tap into there's also an organization called Disability IN It's disability colon IN and they provide great resources for disabled owned and operated organizations. They also do certification and they're a terrific resource for if you're, you know, looking to hire disabled employees or provide better support for your current disabled employees. They have a one number of wonderful resources you can tap into. A couple of additional ones.

There's a National Center for American Indian Enterprise Development. They're a very active chamber that provides information resources and access to suppliers under that umbrella as well as a number of local government agencies chambers of commerce and institutes of higher education. So I don't want you to feel like you have to go out and create this from nothing. There are a lot of great places that will help you get started and provide great support resources and guidance on government policies and other things to help you get started. So I hope this helps you get your supplier diversity initiative underway and think of this as another great avenue to extend your DEI principles out into the community to have a wonderful impact there. And that's a wrap. I'm Michelle Bogan, and that's your DEI minute for today. Thank you so much for listening.

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