Diverse Supplier Certification: An Effective Tool for Business Growth

by Joanne Tica

Businesses that have robust supplier diversity programs report that they see improved quality and often extract other business benefits, including increased market share and access to new revenue opportunities (The Hackett Group, 2017). Companies and organizations that take the time to properly implement a supplier diversity program are in a better position to penetrate new market segments and gain new customers.

What is Supplier Diversity? Supplier diversity is a business program encouraging the process of sourcing products and supplies from minority-owned, women-owned, veteran-owned, LGBTQ-owned, service disabled veteran-owned, historically underutilized businesses, and SBA-defined small business vendors. Some companies create supplier diversity programs to meet customer mandates, to leverage governmental initiatives or to comply with federal supplier requirements. What these companies eventually determine is that, in addition to these benefits, robust and well-designed supplier diversity programs can be instrumental in improving a company’s bottom-line and can impact more than spending.

Promoting Innovation through Supplier Diversity Smaller diverse businesses are agile and can implement change and innovation more quickly than larger, more established suppliers. Companies that continually use the same supplier network risk losing creative benefits that can be gained by seeing the depth of innovation that can be represented by a more diverse supplier base. Diverse businesses can also provide solutions for customer acquisition in more diverse markets. The knowledge base that diverse businesses can bring to a business or organization expands opportunity by bringing new ideas to the forefront of your research and development, or marketing, teams. New ideas that the market wants to see can result in growth opportunities and increased profitability.

Value Advantage through Supplier Diversity Suppliers want to give you the best deal that they can to win your business. By expanding your network of suppliers for similar products, you are engaging the supplier network to remain competitively priced and to analyze and offer other service factors, such as location, depth of product offerings, quality and overall customer service, as a way of differentiating their value proposition to you, the buyer. According to The Hackett Group, companies with well-designed supplier diversity programs spent an average of 20% less on their buying operations and increased their overall return on procurement investments.

A Positive Tool for Growth and Economic Impact Suppliers who invest in certification hope to differentiate themselves as forward thinking companies who are a part of the shifting demographic profile in our country. Major corporations and organizations who partner with diverse suppliers can potentially receive additional benefits by applying their spend toward diverse supplier requirements required to bid and win federal contracts. Small, medium and large corporations who partner with diverse suppliers can produce significant impact in their local communities while creating jobs at the local and regional level. Supplier diversity is usually a win-win for all of the companies involved.

References The Hackett Group. (2017, 02 17). Research Alerts and Press Releases. Retrieved from The Hackett Group: http://www.thehackettgroup.com/about/research-alerts-press-releases/2017/02162017-top-supplier-diversity-programs-broaden-value-proposition.jsp

Joanne Tica is an organizational development strategist who works with growth oriented companies seeking tools, tactics and strategies to support continued growth. If you are interested in learning more about how a robust supplier diversity strategy can strengthen your company’s growth curve, please contact Certified Impact by clicking here.

Make Board Engagement Your #1 Big Idea

by Joanne Tica

No one can do it alone. I’ve tried, and it doesn’t work.

Advice from others has shaped my most important milestones – from the early days of my father teaching me to tie my shoes to the graduate professor enlightening me on the finer points of andragogy right down to my current business advisers suggesting I focus on stage two companies. In the instances where I’ve folded my arms and said, “I don’t need anybody,” I have almost always fallen short. The fact is: We need others to succeed.

This is particularly true in business. As the founder and managing director of Certified Impact, LLC, a Chicago-based training and development agency, I serve on a number of advisory and nonprofit boards, offering advice on growth strategy and organizational development. Many people are familiar with the idea of serving on a nonprofit board of directors. You champion the cause, gain experience, network, and feel almost heady when your efforts make a tangible difference.

Another, less thought of, type of board is an advisory board for your own corporation or sitting on one for another company. According to American Express OPEN “State of Women-Owned Businesses,” one in five firms with revenue of $1 million or more is woman-owned. One breakaway strategy to surpassing that financial benchmark is to surround yourself with people who have accomplished what you are looking to achieve. Advisory boards fill confidence and knowledge gaps.

In my experience, I’ve found that many women believe soliciting help from others reflects weakness. The “we-can-do-it-all” mentality is not surprising. We run the business and the household. We plan the IPO and the family party. We’ve been “doing it all” for a long time. Asking for help, though, is a prerequisite for business growth. An advisory board of three to five people (think of them as professional mentors guiding your business with lodestar precision) can be the catalyst for your business to run at breakneck speed. Leave friends and family off the list. Go for colleagues possessing skills you don’t have. Typical honorariums may include equity interest in the company or a meeting stipend ($1,000 per quarterly meeting is not unusual).

Next, understand the objective of your board. Is it broad or narrow? Is social media a major deficit or will your board be architecting your business roadmap over the next five years? What records do you want to break? Where are your business’ greatest weaknesses and how can a board fill them? How will your board contribute to your sustainability and long-term vision?

Keep your board informed. Give them a copy of your sales goals, P&L, customer surveys, employee comments, and any other intelligence two weeks prior to each meeting. Reserve meeting time for strategic discussion, not as a sharing session. Your board’s performance is, in part, based on the information you provide. Clearly communicate your expectations. Embrace negativity and conflict. If you want to grow, forego umbrage for learning.

Now that we’ve looked at creating an advisory board for your business, let’s explore you serving on one for someone else’s corporation. This is a great way to elevate your business stature and plant your flag as a thought leader.

How do you find a seat at the table? Put your name out there via your network and industry trade organizations. Let them know you are willing to serve as a mentor or on a board and that you have demonstrated success in particular areas. Don’t be shy about showing your credentials. Your message to prospective board members and to the CEO of the company you hope to serve: “I’m going to be effective for you, and here’s why.”

Authenticity reigns when working on another’s behalf. Self-serving reasons proffer failure for everyone involved. Be upfront about what you want out of the relationship. The desire to help the other company grow should be first and foremost.

A relevant quote from Bloomberg Business: “You need advisers to bounce ideas off, to provide a reality check, to tell you when you’re about to mess up, to confide in when you’re alone at the top.”

Let’s make this year the year for women to extend beyond our business borders. Board engagement is a path laden with growth opportunities – and one you never have to travel entirely alone.

Joanne Tica is an organizational development strategist who works with growth oriented companies seeking tools, tactics and strategies to support continued growth. If you are interested in learning more about how a robust supplier diversity strategy can strengthen your company’s growth curve, please contact Certified Impact.