What is Supplier Diversity and Why is it Important?
What is Supplier Diversity?
Have you been hearing the term “supplier diversity” but aren’t sure what it means? As with many business terms, the definition and implementation of the words can vary by company. Let’s start with the general definition, then we’ll dig a little deeper. A diverse supplier is a business owned and operated by an individual or group that is part of a traditionally underrepresented or underserved group. In the United States for example, there are approximately 16 categories used to identify diverse businesses. In other words, supplier diversity refers to a supply chain that incorporates businesses owned by diverse individuals or groups.
Diverse certification is an important milestone in the life of a supplier because it authenticates that the business is owned, managed, and controlled by a qualifying diverse group. Certification also opens the door for opportunities to contract with the federal government, which has a mandate to increase the number of diverse suppliers within an organization’s supply chain.
Entities such as the Women’s Business Enterprise National Council (WBENC), the National Minority Supplier Diversity Council (NMSDC), the National LGBT Chamber of Commerce (NGLCC), and the U.S. Department of Veterans Affairs Vets First Verification Program focus on ensuring that businesses are appropriately categorized by offering nationally recognized third-party certification services. Regional councils and state and local governments also offer certification services.
Why Is Supplier Diversity Valuable?
Why should companies make inclusive supply chains a priority? The reasons range from social responsibility to the bottom line. Ideally, supplier diversity combines the best of our desires for a better, more equitable world and the drive to be a competitive leader in the marketplace. Beyond the social responsibility and economic impact metrics, the fact is that inclusive supply chains present a competitive advantage, as progressive organizations that have already implemented an effective strategy have realized.
A supplier diversity commitment benefits a company because it:
Promotes innovation through the introduction of new solutions
Provides multiple channels from which to procure goods and services
Drives competition between the company’s existing and potential vendors
Allows a company to take advantage of new opportunities for business expansion with the emergence of new consumer needs based upon shifting demographic realities
Supplier Diversity Thought Leadership
As a Minority and Woman-Owned Business Enterprise (MWBE), The Millennium Group (TMG) sees Supplier Diversity not merely as a nice suggestion, but rather, a critical step in the collective path of social progress. We aim to help the prioritization of working with businesses owned by people in historically suppressed groups.
Our commitment to Supplier Diversity strengthen the agenda of TMG and allow us to achieve goals within our business and through our supply chain. Our TMG Supplier Diversity Business Practice helps us reach our goals, form important partnerships and holds us accountable as a business on our path to becoming the leader in sustainable business.
As a company with both local and global reach, we are committed to supporting a system in which diverse suppliers can thrive in an everchanging economic world. We believe that promoting diverse businesses is pivotal for creating a stronger, fairer, and more inclusive society. Our aim is to build forums for new business innovations, drive a healthy competitive landscape, and foster unique partnerships with various businesses through our supplier diversity program.
Want to learn more about our Supplier Diversity Program: https://www.tmgofficeservices.com/supplier-diversity