How GSK gets value from supplier diversity

21 November 2017

Businesses that embed diversity and inclusion into their procurement workforce will see a “trickle down effect” leading to a more innovative supply base, according to GSK global category manager Cat Hudson.

Speaking at the Bramwith Consulting Diversity and Inclusion conference, Hudson explained how pharmaceutical company GSK was taking proactive steps to embed diversity and inclusion not only within the culture of the organisation but also with their suppliers.

She said if GSK hired the same people with a similar upbringing, similar schooling and similar culture, it would produce monolithic thinking within the organisation.

“That’s not what we want because ultimately diversity and inclusion is critical for innovation because in science, we don’t want monolithic thinking and we don’t want people looking at structures in the same sort of way,” she said.

“This is our organisation's stance on diversity and inclusion and that trickles down to wanting to involve our suppliers to be diverse too.”

She said one way GSK was trying to promote diversity in their supply base was having five professionals that focused on supplier diversity to utilise firms owned or led by under-represented groups, such as women or ethnic minorities.

“Every year, the five supplier diversity managers will ask for a list of all the contracts that are up for tender and they will filter and go to a variety of different consortiums to decide which organisations and groups can deliver them for us,” she said.

“One example is that we go to WEConnect [a global supplier diversity initiative connecting women-owned business] and we’ll say ‘we’re actually looking for a communications partner—do you have any suppliers that can help us do that?’ and they will give a variety of different suppliers.”

To further embed diversity and inclusion into the culture of the organisation, Hudson said this year her company created an inclusion diversity council in procurement, chaired by the CPO.

“He put an hour aside a month and each department in GSK procurement was represented, whether it was the vice president of the department or director or a graduate and we met up with HR, communications and legal,” she said.

“We looked at layers and how we could drive inclusion and diversity and it was here that lay all the basic groundwork about contracting, our supplier engagement portals and then we looked at how we could partner with our tier one suppliers on how their organisations were dealing with this area.”

She said during one meeting they discussed whether the human rights language they used in contracts was LGBT friendly, which led to all their supplier contracts being amended within 2-3 days to reflect the organisation's diversity drive.

GSK’s e-sourcing team then edited their tendering questions to make diversity part of its on-boarding process.

“Instead of asking, ‘Do you discriminate against women or LGTB people?’ we changed the wording to say, ‘Can you actually elaborate on what you do to drive inclusion and diversity in your organisation?’ and, ‘What are your key areas and goals?’” she said.

“Being able to define our beliefs and expectations and feed them into the tendering process meant that we could partner with suppliers that had the same focus as us.” 

Concluding, she said it was important that the council was set up to not only kick-start all the initiatives but also to help sustain it beyond initial changes.

“Creating a council is something I highly recommend—it’s a great way to get a CPO on board—it looks great for them, it looks good for the procurement leadership team but we were also able to make quicker decisions and have faster outcomes,” she said.

“Also, it is very easy sometimes for organisations to get excited and make these initial changes and then have interest drop off, but for us the council’s monthly meetings keep it really embedded in the culture of our organisation.”

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