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Supplier Diversity Blog by supplier.io

What Is a Diverse Supplier Development Program?

GettyImages-614229200-281832-editedA goal of supplier diversity programs is to provide opportunities to businesses that might otherwise be shut out of contracting with big companies. Naturally, the more successful the diverse supplier, the more of a benefit it will deliver to the contracting company. 

With this in mind, supplier development programs have become a popular initiative within supplier diversity programs of organizations committed to promoting and driving diversity.

The concept of supplier development is simple: A supplier diversity program and its sponsoring organization offer resources and guidance to help vendors expand their operations, deliver a better product, and become more successful.

Moreover, many supplier diversity programs see supplier development as a responsibility, both internally and externally. In our new 2018 report, The State of Supplier Diversity—Supplier Diversity Programs, 43 percent of respondents said supplier development is a driver of their programs.

A great aspect of supplier development is that there are no set parameters of what you can and cannot do—your program can be formal or informal, expansive or limited.

Here are some things to know about supplier development programs as you ponder adding or expanding such an initiative:

The Next Step for Supplier Diversity Programs

Successful supplier diversity programs can’t simply sit back and enjoy their success. Of course, a healthy diverse spend and a track record of finding new diverse suppliers are reasons to celebrate, but how do you build upon those accomplishments?

Supplier development is the next logical step to strengthening both your program and the diverse suppliers that contribute to your program and your company’s bottom line.

Investing in your suppliers turns them into better partners that deliver a higher-quality product on schedule. And better partners boost your supplier diversity program, thus creating a cyclical benefit that the C-suite can’t help but notice.

The Parts of a Supplier Development Program

What exactly does a supplier development program entail? That answer will differ by supplier diversity program and by how much effort you put into development.

An informal program might include just a few initiatives; a more formal program can be far-reaching. Generally, a supplier development program will feature:

  • Mentoring: Your company provides advice and guidance for diverse suppliers in your portfolio, or you direct chosen suppliers to outside resources and mentors for help.
  • Networking: You direct diverse suppliers to networks, associations, and events to help them grow their businesses.
  • Matchmaking: Diverse suppliers need their own quality vendors in order to be successful. Through matchmaking, you provide key suppliers with guidance and recommendations to find the partners they need to take their businesses to the next level.
  • Executive education: More knowledgeable leaders at diverse suppliers inevitably drive better business practices and increased output, which in turn, benefit your supplier diversity program and your company. Footing the bill for educational opportunities enables this knowledge and creates goodwill with your diverse partner.
  • Collaboration: Instead of merely placing an order from a diverse supplier, your company can collaborate with the partner on a deliverable or service and give both parties a chance to learn from each other.

Measuring Supplier Development Success

Diverse suppliers happy with the help you are giving are an anecdotal sign of success and should not be discounted, but if you plan to embark on a formal supplier development program, or even on something more informal, you should be tracking some hard numbers to back up the effectiveness of your efforts.

Some metrics and key performance indicators (KPIs) might include:

  • Increased business/spend with diverse suppliers in the development program
  • Increased performance by diverse suppliers in the development program
  • Increased overall revenue of diverse suppliers in the development program
  • Turnover of suppliers in the development program (perhaps compared with churn of suppliers not being developed)
  • Decreased costs (how much have your expenditures decreased because of better diverse suppliers?)
  • ROI (how have developed suppliers produced a return for your supplier diversity program?)
  • Economic impact (how much has developed supplier growth contributed to the community, employment numbers, and so on?)

Even if you are starting small with your supplier development program, at least a few metrics will help you chart progress and show what is and is not working with your efforts.

How Technology Helps

The emergence of supplier diversity technology has been a boon for supplier development initiatives.

Not every diverse supplier in your portfolio will be a good candidate for development; the best supplier diversity software gives you an accurate and constantly updated view of all the vendors in your program so that you can determine which partners will most benefit from your help.

Technology can also help you better track ROI and other KPIs and see if development measures with a supplier truly have led to better results.

Finally, the efficiency that supplier diversity software offers your program saves you time and energy that can now be devoted to building relationships and directly communicating with and mentoring partners.

With much of the busywork out of the way, development becomes a priority—a priority your diverse suppliers will appreciate and use to everyone’s advantage.

What results have you witnessed from your supplier development program?


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The team has a long history in driving innovative solutions in supplier diversity. We believe that companies deserve solutions that are effective and provide measurable value and results. Started more than a decade ago, supplier.io has rapidly become a prominent provider of supplier diversity solutions to leading corporations. We currently support customers in automotive, healthcare, insurance, retail, manufacturing, education, and banking. One in five Fortune 50 company relies on supplier.io.