Establishing a supplier diversity program can be a great way to enhance procurement, encourage innovation, support your company's mission and more. But just spending a few dollars with diverse suppliers here and there might not cut it. If you want to reach the pinnacle of supplier diversity programs, consider aiming to make it to the Billion Dollar Roundtable.
Established in 2001, the Billion Dollar Roundtable is an association for businesses that spend at least $1 billion per year with minority and woman-owned first-tier suppliers, among other criteria underpinning robust supplier diversity programs. Members can then learn and share best practices on supplier diversity.
So how can you make it to the Billion Dollar Roundtable? Whether your organization already has more than $1 billion in supplier spend that you could start to reallocate or you’re part of a smaller business that would like to get on a path toward growing diversity spend, there are clear steps you can take. These include:
Track Supplier Spend:To reach the Billion Dollar Roundtable, you need to be able to objectively measure your diversity spend. Set clear targets for your supplier diversity program and measure your progress along the way. If you track all your supplier spend, you can see the overall value of your vendor spending; you can’t make it to the Billion Dollar Roundtable if you’re only spending $500 million on suppliers overall, let alone what you allocate to diverse suppliers. Still, knowing this amount can help you track your progress as your company grows. From there, you can identify areas where you might be able to shift spending towards diverse suppliers. For example, perhaps you didn’t realize how much of your spending goes toward suppliers in a certain region. As part of efforts to reduce concentration risk, you might decide to then shift some spending to, say, a local, women-owned supplier.
Form Strong Relationships With Suppliers:Another way to grow your diversity spend and eventually make it to the Billion Dollar Roundtable is to form strong relationships with existing suppliers. Similar to the benefits of joining supplier diversity associations, forming strong bonds with suppliers can help you gain access to other vendors so you can grow your diversity spend. For example, suppose you work with a veteran-owned IT services supplier. That vendor may then use a veteran-owned office furniture company as one of their own suppliers. So, forming a good relationship with the first supplier may prompt them to then introduce you to that other veteran-owned business.
Publicize Supplier Diversity Programs:Getting the word out on your supplier diversity efforts can also attract other diverse suppliers. For example, increasing awareness about how diverse vendors can apply to work with you as a supplier could make it easier for your company to increase diversity spend.
Plus, publicizing supplier diversity programs could boost employee and customer experience. Doing so could help your company grow, thereby increasing your overall budget for procurement spend.
Partner With Supplier Diversity Experts:In addition to supplier diversity associations, some third-party experts may be able to help you grow your diversity spend. For example, GoProcure, a diverse business itself, can connect you with a wide range of diverse suppliers, both through our e-procurement platform and through our procurement consulting services. Our technology and expertise can help you better understand your overall procurement spend in more detail, thereby helping you find areas where you can increase diversity spend.
Even if you’re not at the point where you can spend enough to make it to the Billion Dollar Roundtable, simply following these steps can help you grow and get more out of your diversity spend.
Have questions about how you can optimize your supplier diversity program? Request a free consultation with our experts today.