Diversity has become an important focus for most of the world’s leading businesses today, whether it’s the people they hire or the kinds of companies they do business with.
The increasing attention on diversity is encouraging, but it still too frequently falls into a ticked box for corporate social responsibility (CSR). This is because it’s still seen as simply beneficial to culture and reputation, rather than a key strategy.
In fact, supplier diversity has a clear track record in driving operational value, extending far beyond the benefits of a CSR scheme. Research from The Hackett Group found companies with established supplier diversity programmes that include SMEs and ethnic minority-controlled businesses (EMBs) generated 133 per cent better return on their buying operations. It also found companies working with smaller and more diverse suppliers spent 20 per cent less on their buying operations, and secured significantly greater value as a result.
Working with a range of different suppliers is often seen as a risk mitigation strategy, especially when it comes to key services or supply chains in fields like manufacturing. But alongside moving away from reliance on a single large supplier, real value is found in ensuring that the suppliers themselves are diverse.
Whether it’s an SME or woman-or ethnically-owned business, diversity ensures you work with suppliers that come from a range of backgrounds, with different journeys and ways of thinking. This can lead to a greater propensity towards thinking outside the box, providing greater innovation and problem solving for customers. We have seen international blue chip brands starting to recognise the growing value that this approach brings to their operations.
Gibbs S3 has become the only corporate-level business to be officially certified as an EMB by MSDUK, the country’s leading non-profit membership organisation driving inclusive procurement. We have also previously been certified as a woman-owned business enterprise by WEConnect, the leading global supplier diversity initiative connecting women-owned businesses with multinationals.
Being ethnic or woman-owned does not make a supplier inherently valuable of course, and a diverse background must be combined with a proven ability to be innovative, engaging and agile.
But despite the growing trend for diversification, woman and minority-owned suppliers are still under-represented, especially in fields like technology and engineering. We are delighted to be the first corporate-level company officially certified as an EMB by MSDUK, and with the increasing demand for minority-owned suppliers I hope many other companies will be joining us soon.
☛ Farida Gibbs is Founder and CEO of hybrid staffing solutions specialist Gibbs S3