How Diverse Suppliers Can Leverage their Status with Large Enterprises
To continue the previous conversation on diversity and inclusion (see my other articles on the enterprise approach to supplier diversity and how to shape the future of supplier diversity), I’d like to look at the other side of the coin: What can suppliers do to help enterprise clients improve their diverse supplier inclusion, selection and support practices? Some recommendations I would offer from my experiences and observations may help shed some light.
1) Obtain Supplier Diversity Status
I have witnessed many suppliers that do not want to highlight their diversity status and have even underplayed it. I’ve also seen suppliers that prefer to utilize non-diverse client-facing team members or set up the team in a traditional, stereotyped manner.
These stereotypes have led many diverse-owned businesses to shy away from getting an independent certification that validates their diversity status. Also, there is a bit of principle at the heart of the matter, too. Why does an organization need to pay another organization to prove that they are diverse? That would like me needing to provide written proof that my ancestry is Indian or that I am a woman.
This practice has led to fees for validation that many small or diverse businesses cannot afford in order to access enterprise opportunities. That doesn't sound like being inclusive in 2021. Also, on principle, it is not appropriate to use it as the only validation means to prove that a supplier is diverse.
With that in mind, it is crucial to highlight that many enterprises have made it a requirement to have diversity certification from independent bodies. Instead, I would recommend that procurement teams establish a simple, self-certification process as an acceptable diversity certification instead of putting the burden on a small supplier to gain independent certification.
I also recommend that suppliers visit their local city business office to seek ways to gain a diversity certification. Many will have suggestions to demonstrate diversity status and offer tips localized to your community. Suppliers can take ownership to show their diversity status that won’t cost thousands of dollars to accomplish. As a supplier or a procurement team member, if you are looking for a form to help suppliers self-certify, please reach out to me, as I am happy to share some of those well-established resources.
2) Boldly Communicate Supplier Diversity Status
Some supplier organizations tend not to publicly bolster their diversity certifications and only mention it privately when it is clear that diversity status may help on a bid, typically for government contracts. It is time to embrace diversity status. Make it easy for sales teams and enterprise clients to access your diversity status and certification.
The easiest way to do this is to boldly display the certification or self-certification on your website where it is easily accessible. In my experience, there have been many suppliers that missed opportunities because the diversity status information wasn't readily available to decipher, or procurement teams didn't have adequate investments to identify diverse supplier pools. So, make it easy on both ends: be bold and take pride in your diversity status as something to be celebrated and not hidden.
3) Be Mindful of Your Lack of Diversity and Work to Improve It
I can tell you from experience that procurement and business teams are turned off when they visit a prospective diverse or a supplier highlighting their diversity and inclusion values on their website and the only thing on the leadership page is predominately men with no minority leadership members. I have even been to supplier sites that did not have a restroom for women. Someone had to guard the door outside so that I could use the men's bathroom!
Just because a supplier is culturally diverse, it doesn't take away the need to demonstrate diversity within the organization. Being a person of Indian ancestry, I’ve visited many supplier websites that feature only male representation of the leadership team. This shouts to the lack of diversity consideration, despite claiming diverse organization status. The same rings true for other types of diverse organizations, so being mindful of diverse representation is a critical element of moving forward in the future.
Simply put, diverse or not, your website represents your principles, who you are as an organization, and reflects your awareness and importance for diversity, regardless of the country your business is based in or clients and geographies you support.
4) Highlight your Successes with Existing and New Clients
Consider creating a “showcase page” of projects that highlight success with enterprise clients across the various industries your companies have invested to support and grow. If your sales or account teams wait for the “governance” session with executive leadership to highlight accomplishments, it’s a missed opportunity since many executive leaders don’t have the time to meet with every supplier.
It’s time to retire that page of the old-school sales playbook. It's more important to highlight your successes and improvement areas up front than to wait for a seat at the table. When it is the right time, you may get that executive meeting to continue building on the relationship. As a supplier, if you get that seat, be mindful of using it to demonstrate your ability to partner with all internal stakeholders such as procurement, operational teams and not just the business executive team.
Good leaders and executives trust their suppliers and procurement teams to work effectively and problem-solve together. If executives have to get involved in solving every problem their respective organizations encounter, then that organization’s supplier or vendor management practices are not mature. The supplier needs to take the first step to show how best practices application can help improve their ability to work together effectively.
5) Be Clear and Protective About What you Can (and Cannot) Deliver
Too often, suppliers undertake activities they know are a challenge to deliver because they need to make the sale. Larger supplier organizations are much more prone to do this, resulting in “B,” “C,” or even “D” team players being assigned to the project, which creates a challenge for everyone to have a successful outcome. In such scenarios, clients feel they have to throw good money after bad simply because it’s too hard to walk away with the investments that have already been made.
It’s a mistake to think that enterprise stakeholders will forget such scenarios. In fact, they will carry bad experiences with them for the rest of their career. I have heard from many stakeholders about how “X supplier” did a terrible job 10 years ago and the supplier will not get an opportunity for consideration. Unfortunately, enterprise memory is deep and long, so being short-sighted does more harm than good when suppliers take on projects they know will be a challenge to deliver.
This type of organizational memory creates more damage for small or diverse organizations that may not have the resources to fix the problem. My recommendation is to be honest with the client and yourself about the ability to deliver to the client's expectations. You will be better off being disappointed in not earning the business than being challenged to fix the project, deliverables, reputation and perception that will have a long-lasting impact.
6) Share Data, Knowledge and Insights from Your Diversity Tracking
Be transparent with the enterprise team about using other suppliers in the supply chain. Often, suppliers choose not to reveal that they are sub-contracting the work out to other suppliers, which can lead to distrust by the client, both in procurement and the business.
Help the enterprise understand why, for some needs, you would need to go outside of your organization and negotiate in good faith fairly. When someone does not negotiate in good faith and attempts to be sneaky it creates long-lasting damage that might be irreparable. The same goes for the procurement or business team members entrusted with negotiating in good faith and fairness. Without it, co-existing to create partnership-based solutions cannot occur.
Suppliers can leverage enterprise diversity goals to demonstrate their interest and desire to expand diversity. The open dialogue becomes a catalyst for larger suppliers who may not be diverse by committing together to expand and improve the supplier diversity pipeline and creating a support structure that allows the enterprise and the diverse businesses to thrive.
7) Invest in Making Your Diverse Talent Successful
Supplier organizations need to ensure their diverse talent is successful by providing access, opportunities, visibility, support, mentorship and sponsorship. Notice that I separated sponsorship and mentorship. The latter implies that the diverse resource lacks something or needs an adjustment to their capabilities to be successful. The former implies that we shouldn't create mini-me’s or robots that all look, feel and act the same way. Instead, we welcome individuality and cherish the diversity of thoughts and experiences from all of our employees who contribute to the supplier and client organizations' success equally.
The notion of diversity and how organizations can improve equity, inclusion, and belonging is an in-depth and over-due dialogue. Forthcoming, I will share tips and approaches to how the procurement, vendor management and supplier risk management functions can improve diversity as a future discussion topic.
Improving supplier diversity in enterprises will require us to think differently. Enterprise business leaders, the procurement functions, and supplier communities should look at the events of 2020 as an opportunity to reset and reengage in a more meaningful way. When it comes to diversity, it should be viewed as an open dialogue to shape what it means collectively to support diversity initiatives in large enterprises.
Since diversity is a critical element of our future, I am hopeful that some of my observations and tips are useful for others. I would encourage others to share their strategies from business teams, suppliers and procurement partners to push for diversity, not just a far-fetched dream but a new reality that we all embrace.