I was going to start this with something like “In today’s dynamic business environment…”, but I believe there is ample evidence to show embracing partner diversity makes sound business sense in any business environment — it’s a strategic decision that can drive significant benefits across various aspects of a company. Here are 5 reasons adding diverse partners into your procurement strategy is a smart move:
1. Economic Growth and Community Development
Partner diversity plays a crucial role in stimulating economic growth by providing opportunities for businesses owned by minorities, women, veterans, and LGBTQ+ individuals. By engaging with these underrepresented businesses, companies can support local economies and contribute to community development. This not only enhances the company’s reputation for social responsibility but also builds stronger ties with the communities they serve.
2. Shiny New Things
Diverse suppliers bring unique perspectives and innovative solutions, fostering creativity and adaptability within an organization. This diversity can lead to the development of new products and services, giving companies a competitive edge.
3. Grow, Baby, Grow!
If you’re a national brand and working with a partner base that’s highly concentrated in any metric, you’re only availing yourself to a subset of your customers’ perspectives, needs & wants. Gone are the days of the “Mad men”. Today, it’s easier than ever to find partners & suppliers based in the markets you want to expand into. These businesses can help you reach new these markets and better understand diverse customer demographics. This alignment with customer values can strengthen relationships and improve brand loyalty, ultimately leading to increased market share. By reflecting the diversity of their customer base, companies can better meet the needs and preferences of a wider audience.
4. It’s All About the Benjamins
Contrary to the perception of increased costs, partner diversity can lead to significant cost savings. An article from Supply Chain Exchange cited a Hackett Group Study showing that for every $1 million spent on supplier diversity, an average of $3.6 million is added to the bottom line. This is due to increased competition and more competitive pricing from diverse suppliers, which can lead to better deals and improved service quality.
5. Brand Building and Enhancement
You need go no further than your local grocery store to see that Americans have a long history of preferring just about anything that has been “enhanced”. So why not your brand? Companies that prioritize and promote partner diversity are recognized for their social responsibility and commitment to community development. By demonstrating this practice consistently, companies can build trust and loyalty among customers and stakeholders. Word of mouth advertising is still your most effective and cost effective.
Let’s Wrap Up…
Embracing partner diversity is a common-sense business decision that drives innovation, improves financial performance, and contributes to a more equitable and inclusive economy. By adding diverse suppliers into their procurement strategies, companies in all sectors can benefit not only their bottom line but also the communities in which they exist.
About Author: Tim Stark plays a pivotal role in driving growth for our digital services through close collaboration with our strategic ISV partner channel, including Salesforce, MuleSoft, and others. Additionally, Tim also spearheads efforts in acquiring new direct accounts.