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10 Best Practices for Implementing a Supplier Diversity Program – Phase 2

Supplier Diversity
09th Jan 2024 | 12 Mins
10 Best Practices for Implementing a Supplier Diversity Program – Phase 2

Introduction to Supplier Diversity Programs

Supplier Diversity Programs have emerged as pivotal strategies for businesses aiming to infuse innovation and enhance economic growth. These programs, by drawing from a broad spectrum of suppliers across various backgrounds, present a holistic approach to procurement. Such an approach not only diversifies the supply chain but also strengthens it to weather various challenges.

According to a report by the Business Supplier Diversity Council, companies that focus on supplier diversity generate a 133% greater ROI compared to those that don't. Furthermore, for every dollar spent on supplier diversity programs, companies reported generating $25 in return. These figures underscore the tangible benefits of these programs.

Supplier Diversity - Diverse People

Brief Recap of Phase 1 - Implementing a Supplier Diversity Program

Before diving into the complexities of Phase 2, it's paramount to understand the groundwork laid in Phase 1.

Leadership Commitment: Every successful initiative requires unwavering support from the top. When leaders champion the cause, it allocates necessary resources and steers attention. For example, when Apple's leadership backed their diversity initiative, the company saw a 36% increase in its global gender hiring rates.

Senior Manager Appointment: Having a dedicated senior manager ensures clear directives. Think of this individual as the project manager overseeing a construction project, setting milestones and ensuring each team is synchronized.

Policy Development: Drafting clear policies is akin to a company drafting its mission and vision. It provides direction and a framework within which to operate.

Baseline Spend: Knowing where you're starting allows you to set achievable goals. It's like measuring your ingredients before baking – essential for the desired outcome.

Technical Integration: Adopting technology, like integrating an AI-driven analytics system, can streamline processes, providing insights into supplier performance and areas of improvement.

Specialized Reports: These are akin to a doctor's diagnostic tests, pinpointing areas of success and those needing attention.

Onboarding: This involves familiarizing every stakeholder with the program's nuances. Much like orienting new students on the first day of school.

Tier 2 Spend Program: This expands the program's reach, ensuring that not only primary suppliers but also secondary suppliers align with diversity goals.

Best Practices and Goals: Setting best practices is like defining the rules of a game, ensuring clarity and fairness.

The Transformative Impact of Supplier Diversity

Embracing supplier diversity can lead to significant advantages. Companies like Johnson & Johnson and IBM have reported increased market shares after implementing these programs. A diverse supplier base fosters creativity, offers unique perspectives, and taps into a broader audience. Furthermore, it enhances resilience against supply chain disruptions by avoiding over-reliance on a particular group.

Supplier Diversity & Inclusion (SDI) Drivers

Identify Key Supplier Diversity & Inclusion (SDI) Drivers

The driving forces behind SDI programs often include:

  • Market Competitiveness: Diverse suppliers often provide unique solutions, giving an edge in a competitive market.
  • Customer Expectations: Modern customers value brands that reflect societal diversity. For instance, companies like Google have been pressured by their users to display more transparency in their diversity stats.
  • Regulatory Compliance: Many governments have set guidelines promoting diversity, pushing companies to adapt.
  • Economic Impact: Diverse suppliers can often offer cost-effective solutions, positively impacting the bottom line.

The Importance of Moving to Phase 2 - Implementing a Supplier Diversity Program

With the foundations set in Phase 1, Phase 2 comes into focus. Think of this as moving from setting the base of a building to designing its interiors and functionalities. This phase accentuates refinement and enhancement, building on the pillars already established.

Ten Best Practices for Implementing a Supplier Diversity Program Phase 2

1. Comprehensive Training:
Continuous training and development opportunities are pivotal. They ensure that stakeholders are not only aware of the program's objectives but are also equipped with the tools and knowledge to achieve them.

For instance, IBM frequently conducts workshops and seminars to ensure that their teams are well-equipped to understand and manage their diverse suppliers. Regular training sessions on the latest trends, policy changes, and technology can help in implementing the program more efficiently.

2. Strengthen Supplier Relationships:
Forge stronger bonds with suppliers. By deepening these relationships, businesses can better understand their needs, challenges, and opportunities, fostering a symbiotic relationship.

Take Cisco, for example, which has built robust relationships with its diverse suppliers through regular feedback sessions, collaborative workshops, and partnership events. By deepening ties, companies can better comprehend the unique strengths, challenges, and opportunities each supplier brings to the table.

3. Utilize Technology:
In our digital age, leveraging cutting-edge technology is a must. It enhances efficiency, offers better monitoring tools, and provides platforms for communication and collaboration.

Walmart, for instance, uses a sophisticated Supplier Management System to track, evaluate, and manage its vast array of global suppliers. By integrating such systems, businesses can monitor performance in real-time, ensuring swift response and adjustment strategies.

4. Encourage Feedback:
Feedback serves as a beacon, highlighting areas of improvement. By actively seeking and valuing feedback from suppliers, businesses can refine their strategies and drive greater value.

Companies like Procter & Gamble have feedback mechanisms where suppliers can voice concerns, offer suggestions, or highlight potential opportunities. Such platforms ensure that the program remains adaptive and agile.

5. Foster Collaboration:
Collaboration often births innovation. Creating platforms where suppliers can collaborate and share best practices not only drives innovation but also fosters a sense of community.

Consider Toyota’s Business Meeting Groups, where suppliers from similar industries discuss best practices, challenges, and collaborative solutions. Such platforms not only foster innovation but also help in building a cohesive supplier community.

6. Monitor and Update Policies:
The business landscape is ever-evolving. Regular policy reviews ensure that the program remains relevant, effective, and in alignment with current industry standards.

A company like Microsoft regularly reviews its supplier policies to ensure they're aligned with the current market, regulatory standards, and the company's overarching goals. Periodic reviews ensure that the program remains contemporary and effective.

7. Promote Internally:
Raise internal awareness about the program's successes. By celebrating achievements, businesses can enhance participation and garner more support for future initiatives.

General Electric, for example, highlights the achievements and milestones of its supplier diversity program in internal newsletters and at company events. This not only educates the workforce but also fosters a sense of pride.

8. Engage in Continuous Improvement:
Complacency is a program's nemesis. Regular reviews, evaluations, and a commitment to continuous improvement ensure the program's longevity and success.

Coca-Cola, for instance, continually assesses its supplier diversity program, identifying areas of improvement, and rolling out enhancements. A commitment to continuous improvement ensures that the program doesn't stagnate and always evolves.

9. Align with Global Standards:
In an increasingly globalized world, alignment with international standards is crucial. It ensures consistency, credibility, and opens doors to global opportunities.

Companies like Intel ensure that their supplier diversity mandates are consistent with global diversity standards. This ensures that wherever the company operates, its commitment to diversity remains undiluted.

10. Celebrate Successes:
Recognition drives motivation. By celebrating milestones, businesses can motivate stakeholders and reaffirm their commitment to supplier diversity.

Amazon frequently hosts Supplier Diversity Awards, recognizing and celebrating the contributions of its top-performing diverse suppliers. Such recognitions not only motivate the suppliers but also reinforce the company's commitment to the program.

Supplier Diversity Management by VIVA

Navigating the world of supplier diversity can be intricate, but with tools like those offered by STARS by VIVA, the journey becomes more streamlined. For instance, the platform's Data Scrubbing & Enrichment functionality provides an impeccable means to refine and elevate your data, ensuring you're making decisions based on precise and enriched information. Their Supplier Registration feature offers tailored forms, designed to capture all the pertinent details, making the search for specific suppliers swift and straightforward.

Additionally, for businesses keen on delving deep into their spend patterns, Tier 2 Spend Reporting provides an intuitive interface to simplify data submissions and insights into both direct and indirect spending trends. For more concentrated data on primary suppliers, Tier 1 Analytics integrates and amplifies your primary supplier data, offering a gamut of reporting possibilities.

However, if you're looking to explore new suppliers, their Supplier Sourcing & Locator serves as a gateway to an expansive supplier database. This feature is like having a vast marketplace at your fingertips, making the sourcing process almost seamless. And, to truly gauge the ripple effects of your investments in diverse communities, Economic Impact Analysis stands out. This module, anchored on industry-backed methodologies, quantifies your contributions to diverse communities, providing a clearer perspective on your impact. All in all, STARS by VIVA seems to offer a comprehensive suite tailored for a holistic Supplier Diversity Program experience.


In today's complex business landscape, a robust Supplier Diversity Program is no longer a mere luxury; it's a necessity. Leveraging tools and platforms like those presented by STARS by VIVA can transform this seemingly intricate process into a seamless and efficient one. From ensuring data integrity with Data Scrubbing & Enrichment to tapping into expansive supplier databases with the Supplier Sourcing & Locator, the right tools can make all the difference. As businesses continue to recognize the importance of diversity in their supply chains, tools such as these will undoubtedly play an integral role in shaping a more inclusive, diverse, and robust business environment.

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Frequently Asked Questions

Supplier Diversity Programs are strategies businesses employ to infuse innovation and enhance economic growth by procuring from a diverse range of suppliers across different backgrounds.

According to the Business Supplier Diversity Council, companies focusing on supplier diversity see a 133% greater ROI, generating $25 for every dollar spent on these programs.

Strong leadership support, as seen with companies like Apple, can significantly improve the success rate and growth of diversity initiatives within the organization.

A senior manager provides clear directives, ensuring synchronized efforts, and overseeing the program's progress, similar to a project manager in a construction project.

Technology, especially AI-driven systems, streamline processes, offering insights into supplier performance and highlighting areas for improvement.

Companies like Johnson & Johnson and IBM have reported increased market shares post-implementation, indicating enhanced creativity, broader customer reach, and increased resilience against supply chain disruptions.

Key drivers include market competitiveness, meeting customer expectations, regulatory compliance, and the potential for economic benefits.

While Phase 1 lays the foundational pillars, Phase 2 focuses on refinement and enhancement, building on the established base.

Continuous training ensures stakeholders remain updated on the program's objectives, latest trends, and are equipped with tools and knowledge for effective implementation.

By fostering deeper ties through regular feedback sessions, collaborative workshops, and partnership events, businesses can understand their suppliers' strengths, challenges, and opportunities better.

Cutting-edge technology enhances efficiency, offers superior monitoring tools, and facilitates seamless communication and collaboration among stakeholders.

Feedback provides insights into areas of improvement, helping businesses refine strategies and drive more value from the program.

By raising internal awareness and celebrating achievements, businesses can enhance participation and garner greater support for future diversity initiatives.

By consistently updating and reviewing policies, businesses can ensure their supplier diversity mandates remain in sync with global diversity standards.

STARS by VIVA offers a comprehensive suite tailored for a holistic Supplier Diversity Program experience, providing tools from data scrubbing & enrichment to supplier sourcing & locators.

STARS by VIVA transforms the intricate supplier diversity process into a streamlined experience, offering tools that ensure data integrity, expansive supplier databases, and insights into spend patterns.

Key features include Data Scrubbing & Enrichment, Supplier Registration, Tier 2 Spend Reporting, Supplier Sourcing & Locator, and Economic Impact Analysis, among others.

With tools like Economic Impact Analysis from STARS by VIVA, businesses can quantify their contributions and understand the difference they're making in diverse communities.

The ever-evolving business landscape demands regular reviews and updates to ensure the program remains effective, relevant, and aligned with current industry standards.

Recognizing milestones and celebrating achievements can motivate stakeholders, reinforcing their commitment and dedication to the program's success.