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Supplying Diverse Entrepreneur Opportunities
The growing push for diversity on the supply side at large, global corporations and big government agencies benefits Hispanic entrepreneurs and suppliers, as well as other minority-owned enterprises (MBEs).
There’s been much discussion regarding the need for diversity and inclusion in all aspects of business. There’s been a definite evolution on the employee side to the point where a diversified workforce and inclusion in the workplace are paramount to business and government.
But there’s also the impact of supplier diversity on the procurement of products and services at companies and government organizations at every level. Recognized as a successful business strategy, supplier diversity programs encourage diverse spending with certified and qualified, third-party owned, managed and controlled businesses that are owned by members of minority groups and other underrepresented groups. This, in turn, creates a diverse supplier base and supplies diverse entrepreneur opportunities to businesses that may not otherwise have a way inside large organizations.
Here’s what five leaders in supplier diversity are doing to open doors for small and medium-sized suppliers and entrepreneurs, and bring more minority-owned, women-owned, veteran-owned, LGBT-owned, service disabled veteran-owned, historically underutilized businesses, and U.S. Small Business Administration (SBA)-defined small business vendors into the global marketplace.
Read on to discover why they’re all in on supplier diversity, especially as it relates to Hispanic business markets.
UPS’ Oswold Uncovers & Communicates the Hidden Value of Supplier Diversity
Headquartered in Atlanta, GA, UPS is a global leader in logistics. It offers a broad range of solutions, including transporting packages and freight, facilitating international trade, and deploying advanced technology to more efficiently manage the world of business.
Serving more than 220 countries and territories, UPS ranks high among the world’s companies, receiving numerous prestigious awards and recognitions for social responsibility while remaining steadfast in its belief of and participation in promoting a policy of supplier diversity.
According to Kris Oswold, director of supplier diversity, UPS actively seeks to work with suppliers who reflect the diverse markets they serve. “Building an inclusive supply chain is a business strategy that can bring great returns, as diverse suppliers provide expertise and development in the communities we serve,” she states.
It was this perspective that inspired the 1992 formal launch of the supplier diversity program at UPS - one that remains true today.
“Last year the company was again recognized by the U.S. Hispanic Chamber of Commerce (USHCC) for its commitment to working with Hispanic suppliers, and we are proud of this acknowledgement and hope we inspire others,” she states.
While the UPS diversity and inclusion (D&I) steering committee, chaired by chairman and CEO David Abney, sets policies and overall direction, and ensures that the organization is ready to act in support of its D&I mission, the UPS procurement team and functional stakeholders are tasked with executing the strategy and achieving detailed company-wide goals.
“It’s important to think of supplier diversity in the same way we think about diversity in employment,” says Oswold, remarking that this shouldn’t be one person’s job. “Everyone who’s involved in finding, selecting and developing suppliers must be engaged. Once you understand the power that diversity and inclusion can bring to any problem-solving situation, the places where you can unleash that power becomes clear.”
Oswold is also quick to point out that diverse suppliers must win contracts on the basis of merit. “We work hard to find and help develop diverse suppliers, but to win our business suppliers must deliver the best value to UPS,” she states.
One way UPS develops diverse suppliers is to tailor programming to specific business needs. With an abundance of expertise in transportation, UPS leaders are uniquely positioned to coach and mentor diverse suppliers in this space. “A cross-functional team currently works with a group of minority-owned businesses to help reduce their transactional fuel and equipment costs,” she remarks, adding, “When their costs come down, ours do, as well.
Additionally, each year a third-party organization is engaged to access the economic impact of UPS purchases from small and diverse-owned companies.
“The $2.8 billion spent during 2018 returned a total economic output of $4.8 billion,” reports Oswold, suggesting that when small and diverse communities thrive, they provide a pathway for continued economic and community strength
As a company that transports 6% of GDP daily, contributing to economic growth is good for business at UPS. Studies further indicate that companies desire to work with businesses that share their values.
“The core values of diversity and inclusion impel many UPS customers to seek companies and employees who share its perspectives,” she points out.
When asked for her advice regarding the implementation of supplier diversity programs by other companies, Oswold emphasizes the importance of understanding all of the ways diverse perspectives can bring value to an organization, and then advises working with stakeholders to develop strategies and maximize that value.
“When putting a plan in place, talk about how to find, certify. and grow diverse suppliers. and ensure all parties understand their responsibilities,” recommends Oswold. “To achieve meaningful change from the start, your strategy must be understood and supported throughout your organization.”
More information about UPS is available at ups.com/us/en/about/procurement-services.page, jobs-ups.com, ups.com, LinkedIn, Twitter, Facebook, Glassdoor and Instagram.
Bishop Concurs with Mastercard’s Mission to Be a Force For Good
As a tech company in the global payment industry, Purchase, NY-headquartered Mastercard conducts business in more than 210 countries and territories, making everyday commerce activities easier, more secure and more efficient for consumers.
According to Emily Bishop, responsible sourcing and supplier diversity lead, Mastercard is committed to creating a more inclusive and sustainable world.
“Our spend with diverse-owned companies is more than a transaction - it’s an investment and one in line with the company’s mission to be a force for good. Maintaining a diverse supply base drives innovation, enhances thought leadership, and promotes access to growing markets while supporting financial independence and economic development for diverse communities,” she states.
For Bishop, carrying out annual reviews of company policies and procedures accomplishes a two-fold purpose. “Annual reviews allow us to have a firm hand on all aspects of our supplier diversity program, continuously improving and adapting to address constantly changing business environments. We firmly believe that an overall responsible sourcing program must remain true to the mission that drives a supplier diversity policy,” she states.
On the value of committing to a policy of supplier diversity, Bishop cites the raised visibility of the company’s responsible sourcing program. “Not only has this program created numerous champions and advocates of supplier diversity throughout all Mastercard businesses, it also ensures the inclusion of diverse companies is embedded into the company’s strategic sourcing and procurement - ultimately increasing its spend with certified diverse companies,” she explains.
Bishop consistently defines existing company values of development, education, and empowerment by creating and implementing an educational series designed to develop the businesses of diverse suppliers.
“In addition to webinars, workshops and e-newsletters, this initiative allows for internal sharing of content between numerous Mastercard teams - from small business solutions to environmental sustainability,” comments Bishop, adding that “this further empowers a raised level of conversation by diverse suppliers internally, and in a new light.”
Regarding her advice for other companies working toward implementing and maintaining proactive supplier diversity, Bishop stresses the importance of engaging with internal teams, various organizations, peers and other diverse suppliers.
“It takes creativity and consistent engagement to ensure that people understand the benefits of supplier diversity and make informed purchasing decisions,” she concludes.
Additional information about Mastercard can be viewed at mastercard.us/about-mastercard/what-we-do/supplier-diversity.html, mastercard.us/en-us/about-mastercard/careers.html, mastercard.com, Facebook, Twitter, LinkedIn and YouTube.
P&G’s Bates Supports Responsible Sourcing & Sustainable Innovation
At Cincinnati, OH-based Procter & Gamble (P&G), supplier diversity has been a long-term program. Instituted 40 years ago, supplier diversity at P&G continues to be broadly valued, and for 11 straight years more than $2 billion annually has been spent with companies owned by minorities, women, veterans, disabled or LGBTQ+ people.
This includes Hispanic-owned companies that can provide value, especially when P&G brands are trying to reach a consumer segment to which suppliers can relate.
Serving customers around the world with one of the strongest portfolios of trusted, quality and widely recognized leadership brands, today P&G operates in approximately 70 countries worldwide.
According to Nalini Bates, associate director, supplier citizenship, P&G supplier diversity programs are categorized according to tier one and tier two spending, with recent global focus directed toward women-owned suppliers.
“P&G has made a public commitment to spend more with women-owned businesses outside the U.S. with especially strong programs in South Africa and India,” she mentions.
Proactive in the planning, implementation and oversight of the company’s supplier diversity program, Bates took leadership of the supplier citizenship program in 2018.
“This comes to life via three pillars: supplier diversity, responsible sourcing and sustainable innovation,” indicates Bates.
“The supplier diversity program focuses on building economic equality with populations that have historically been given fewer resources and fewer opportunities. Responsible sourcing focuses on ensuring our external supply partners are meeting their highest ethical standards and are operating under the guidelines P&G has provided in areas such as human rights, child labor and anti-bribery.”
Further active in P&G’s internal supplier evaluation process, Bates reports that evaluation data indicates that diverse-owned companies out-perform and out-innovate non-diverse companies.
“These results support general studies that show diverse teams drive better results in the long-term versus non-diverse teams,” she notes.
Regarding recent initiatives for maintaining, expanding and tracking supplier diversity, Bates notes that P&G is evolving both tier one and tier two programs by developing webinars for current diverse-owned suppliers to help build capability and understanding as many are looking to grow with P&G and other customers.
“Additionally, P&G is creating swat teams to work with 10 strategic, majority suppliers to help build their supplier diversity programs. This will further drive P&G’s second tier spend,” she comments.
Bates’ advice for companies interested in starting or expanding a supplier diversity program is to be understandable, relatable and worthwhile.
“Evaluate the level of support you get from your internal management and structure to ensure the program will fit, and be successful, by considering the following: how is your purchases function structured, centralized or decentralized? How will you connect with buyers and measure progress? Does your company’s culture react positively to requirements, i.e. does each leader spend a certain percentage of spend with diverse-owned businesses? Or should you instead build a program that more heavily communicates the business impact of having diverse-owned suppliers in your supply chain?”
She adds: “Lastly, but perhaps most importantly - your supplier diversity program must be supported by senior leadership who are engaged and willing to reinforce the message consistently.”
More information about P&G is available at pgsupplier.com, pgcareers.com, pg.com, Facebook, Twitter, LinkedIn, YouTube and Instagram.
Dow’s Hrywnak: ‘The Value of Supplier Diversity Cannot Be Overstated’
As one of the most innovative, customer-centric, inclusive, and sustainable materials science companies, Midland, MI-headquartered Dow - one of the nation’s top in diversity and inclusion - maintains a portfolio of materials, industrial intermediates, and plastics. Operating 113 manufacturing sites in 31 countries, Dow’s approximately 37,000 employees work diligently to achieve and maintain the company’s high supplier diversity ranking.
According to Gary Hrywnak, global supplier diversity leader for Dow, supplier diversity is a business imperative that delivers enterprise bottom-line value through cost-savings and innovation. Says Hrywnak: “Support from our CEO and executive leadership demonstrates Dow’s commitment to supplier diversity as part of our strategy.”
As one of the company’s seven global inclusion and diversity (I&D) foundational pillars, he mentions Dow will deliver visible, concrete, and meaningful results by accelerating spend with diverse suppliers, scaling globally, and attaining top benchmark status. The success of supplier diversity is measured on the corporate scorecard while leader performance and compensation is also linked to performance against corporate metrics - further illustrating the importance of a diverse supply base.
In his role since 2018 when the company created his position, Hrywnak leads a team charged with developing a multigenerational plan and strategy endorsed by leadership, which included engaging Ralph G. Moore & Associates - the gold standard for supplier diversity benchmarking - to assess company policies and process.
“This benchmark activity enabled us to identify opportunities to advance on a path to world-class supplier diversity,” he reports.
“We further aligned with industry best practices and developed a network of champions to enable the implementation of supplier diversity global strategy in the U.S. and targeted countries.”
By embedding supplier diversity into Dow’s global procurement process, Dow was able to drive enterprise value, and transform the measuring and tracking process to accelerate spend with diverse suppliers.
Not only is supplier diversity the right thing to do, it’s also a smart thing to do regarding business success, contends Hrywnak.
“Engaging with diverse suppliers and unlocking the potential of suppliers who haven’t had the opportunity to play on a large corporate stage drives innovation, inclusion and impacts the bottom line. It also positively impacts economic influence in communities where employees live, work, and do business by creating sustainable business and personal relationships,” he states.
One year into the global I&D strategy, Hrywnak notes that supplier diversity efforts have expanded beyond the U.S. “To maximize enterprise bottom-line value, Dow has quickly begun to scale globally, with focus on targeted countries where it operates.”
As for Hrywnak’s advice to other companies implementing supplier diversity programs, he maintains that first and foremost step is attaining executive support and funding - just as Dow provided from the beginning.
He additionally cites the importance of aligning the value proposition to business objectives, and collaborating with peers, champions, national, and international councils, and other stakeholders.
“By embedding supplier diversity within strategic sourcing processes, resistance to change and barriers to success can be eliminated,” emphasizes Hrywnak, noting, too, the importance of celebrating successes and marking milestones to remember where you were and where you are going.
For more information about DOW, visit corporate.dow.com/about/suppliers, corporate.dow.com/careers, dow.com, Twitter, LinkedIn, YouTube, Instagram and Facebook.
Byron Leads Supplier Diversity Process Implementation at Walmart
What started approximately 50 years ago as a single small discount store based on the simple idea of selling more for less, Bentonville, AR-headquartered Walmart has since grown into the largest retailer in the world. Each week, more than 275 million customers and members visit Walmart’s more than 11,300 stores under 58 banners in 27 countries and e-commerce websites in 10 countries.
Today the company employs 2.2 million associates, and continues its role as a leader in sustainability, corporate philanthropy, and employment opportunity - all part of its unwavering commitment to creating opportunities, and bringing value to customers and communities around the world.
Part of doing so, contends Michael Byron, senior director, supply inclusion, is Walmart’s high regard for the importance of supplier diversity.
“At Walmart, we believe we’re at our best when we promote diversity and inclusion across our supply chain. Our supplier inclusion statement, signed by Walmart CEO Doug McMillon, highlights our belief that a diverse supply chain enables us to deliver better products and a broader selection to the communities we serve, many Hispanic communities among them,” says Byron.
“And, for diverse-owned companies encouraged to explore new possibilities with Walmart, these suppliers gain the added benefit of access to Walmart’s multimillion customers who shop at Walmart stores around the world.”
Charged with leading the process and implementation of Walmart’s supplier diversity program, Byron considers himself fortunate to have the support of top management, which enables the adoption of supplier inclusion initiatives and performance measures.
“For us, supplier inclusion means having the ability to deliver a broader assortment of products, serve our customers at affordable prices and contribute to the economic well-being of the communities we serve,” he points out.
Noting recent initiatives and policies implemented for maintaining and expanding supplier diversity at Walmart, Byron mentions partnering with the Women’s Business Enterprise National Council (WBENC), the largest certifier of women-owned businesses in the U.S., and other corporations to support a Women of Color program that provides access to capital, as well as to business and personal development.
“Focus also centers on understanding the corporate supply chain in addition to gaining entrée to social and business networks,” says Byron, adding that this program will include outreach to WBENC-certified WBEs and non-certified women of color firms.
When asked about his advice for other companies working toward implementing and maintaining proactive supplier diversity programs, Byron’s answer is immediate and conclusive: “Be intentional.”
For further information about Walmart, go to corporate.walmart.com/suppliers, careers.walmart.com, walmart.com, Twitter, Facebook, YouTube, LinkedIn, Pinterest, Glassdoor and Instagram.
A Diversified Supplier Base: By the Numbers
• Companies who participate in a long-term supplier diversity program can generate a 133% greater return on investment (ROI) than those firms who look no further than the suppliers upon which they traditionally rely.
• Supplier diversity programs drive an additional $3.6 million to an organization’s bottom line for every $1 million spent on procurement operating costs.
• Procurement organizations that work with a diverse supplier base also had lower overall operating costs and spend 20% less on their buying operations.
Sources: Hackett Group’s ROI-related Supplier Diversity report and JAGGAER ONE, www.jaggaer.com/5-advantages-of-having-a-diverse-supplier-base
Five Advantages of Supplier Diversity
1. Promotes Innovation: Small and medium-sized businesses, unlike their larger counterparts, are more agile, and can create and innovate quickly. Buyers should capitalize on this opportunity, lest they risk stymieing the creative benefits they could receive, and miss out on the depth and breadth of innovation that naturally occurs when you have a diverse supply base.
2. Provides Multiple Procurement Channels for Goods and Services: Promoting and engaging several suppliers simultaneously reduces the overall cost of the product/service offered. Multiple channels also allow for analysis of the prices, location, and range of goods of several suppliers to determine best one for the job. The volume of opportunities created by forging new relationships with suppliers’ alliances increases, too.
3. Drives Up Competition and Drives Down Prices: No matter what, suppliers seek to offer the best deal to win business. This drives competition between suppliers, which reduces direct and indirect spend.
4. Displays Your Company’s Interest In and Commitment to the Economic Growth of Your Community: Contracting with local small-medium sized enterprises (SMEs) or minority business enterprises (MBEs) has a profound effect on the local community. As a result, spend and consumption increase while jobs are created on the local level.
5. Allows Access to a Different Network: Organizations implementing supplier diversity programs are more likely to penetrate new markets and gain new customers. As the circle of suppliers is widened at an organization, so are their business and certification networks widened, which thereby allows for new supplier relationships to grow.
Source: JAGGAER ONE, www.jaggaer.com/5-advantages-of-having-a-diverse-supplier-base
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