Supplier diversity has its roots in the United States, with more than 50 years of history and evolution behind the programs we see today. But supplier diversity is important across the world as a driver of economic development and growth for millions of diverse-owned and small businesses everywhere. For companies doing business in countries outside of the United States, establishing a global supplier diversity initiative is an opportunity to champion economic equality while gaining access to innovation and new markets.
Why are corporations expanding supplier diversity globally?
According to the Office of the United States Trade Representative, approximately 75 percent of world purchasing power and more than 95 percent of world consumers are outside America's borders. Accessing that enormous potential consumer base means taking your company multinational, and your supplier diversity program should be part of that strategy.
A number of large corporations are doing just that. Companies such as Merck, IBM, Accenture, Johnson & Johnson, Procter & Gamble, Intel, and Ford Motor Company all have robust global supplier diversity programs that not only drive economic equality but also help them better understand global consumer needs, develop deeper market insights, and increase access to innovative solutions.
Why can’t you establish the same supplier diversity program in another country?
Going global with supplier diversity doesn’t mean simply re-creating your current program in another country. As the Global Supplier Development Alliance (GSDA) notes on its website, each country has “unique challenges, different legal, political, and business frameworks, and specific business cases for supplier diversity.” As a result, each country requires its own approach to supplier diversity—its own bespoke solution.
Remember that many of the rights and privileges we enjoy in the U.S.—even as imperfect as our system is—are not globally recognized. You’ll need to be aware of local laws and regulations as well as cultural and societal paradigms that impact diverse suppliers. For example, in some countries, being a known woman-owned business or an LGBTQ-owned business could result in legal sanctions or even physical harm.
Access is another crucial element to consider when developing a global supplier diversity program. How will you communicate request for proposal opportunities to potential diverse suppliers in other countries? How can you provide education, networking opportunities, and other resources? Pharmaceutical giant Merck developed a virtual platform for its annual supplier diversity conference, giving access to diverse suppliers around the world who would be unable to attend an in-person event.
How can you develop an effective global supplier diversity program?
Fortunately, you don’t have to embark on your global supplier diversity journey alone.
Engage with supplier diversity organizations that work beyond U.S. borders.
These organizations can help you understand the unique landscape for diverse suppliers in different countries and regions so you can develop your supplier diversity strategy.
WEConnect International is a global third-party certification entity for women-owned businesses (WBEs) based outside of the U.S. The organization offers education and support for WBEs to partner with large, multinational companies and connects buyers to women-owned sellers based outside of the U.S.
The GSDA is a network of diverse supplier councils in different countries working together to expand supplier diversity around the world. The organizations include:
- SupplyNation (Australia)
- The Canadian Aboriginal and Minority Supplier Council
- Minority Supplier Development in China
- The South African Supplier Diversity Council
- Minority Supplier and Diversity UK
Talk to your peers who have expanded their supplier diversity programs.
Look at your network of supplier diversity and procurement professionals. Who among them has a global program? Reach out and ask if you can pick their brains or take them out for coffee during the next convention or trade show.
Invest in tools designed for global supplier diversity.
The supplier.io Global Edition suite of tools combines the same industry-leading supplier diversity products with a global outlook. The Global Edition platform maintains each country's unique diversity classifications and small-business size standards and is powered by the largest database of diverse suppliers to ensure you’re working with the most current, accurate information. For companies with programs in UK, the Global Edition also provides access to over 150K verified minority and women businesses and over 1M small businesses.
If you’re ready to expand your supplier diversity program beyond U.S. borders, we have the experience and expertise to help you plan, develop, and manage your global supplier diversity program.