Strengthening your supplier diversity efforts requires more than just outreach—it’s about making a proactive investment in building capacity within diverse supplier communities. By fostering innovation, mentorship, and networking opportunities, you’re supporting growth for both your organization and these suppliers. Here’s how to take meaningful steps toward creating a sustainable, mutually beneficial ecosystem. 

1. Be Proactive and Invest in Capacity Building

Most of us understand the importance of diversity in promoting a balanced society, and forward-thinking businesses apply this principle in the workplace. However, connecting buyers with minority-owned suppliers continues to be a challenge. To overcome this, proactive strategies are essential—ones that go beyond initial outreach. 

Supplier diversity should be seen as a long-term investment. By creating mentorship programs, hosting networking events, and encouraging innovation, you’re cultivating a diverse supply chain that drives mutual growth. Here are some actionable steps you can take: 

• Mentorship Programs: Establish mentorship initiatives where your team can provide guidance to minority-owned suppliers, helping them scale their businesses and enhance their capabilities. This could include financial training, procurement processes, or operational advice. 
• Supplier Development: Offer opportunities for diverse suppliers to innovate through research grants, technology transfers, or product development partnerships. Supporting innovation strengthens their position in the market and can introduce new ideas to your organization. 
• Supplier Networking Events: Organize or sponsor networking events that bring together diverse suppliers, corporate procurement teams, and other key stakeholders. Facilitating these connections can lead to valuable partnerships and foster an ecosystem where everyone benefits from shared knowledge. 

Here are some resources to help with outreach, though ongoing support and engagement are key to driving long-term success: 

• Minority-Owned Businesses: Connect with the National Minority Supplier Development Council (NMSDC) or their local affiliates to find and collaborate with certified minority-owned suppliers. 
• LGBTQ-Owned Businesses: Explore LGBTQ Supplier Diversity Programs through resources such as the Human Rights Campaign. Providing ongoing mentorship or sponsorship at community events can also strengthen ties. 
• Veteran-Owned Businesses: Partner with the Coalition for Veteran Owned Business to engage and support veteran-owned suppliers. Offering business development training and advice can be particularly beneficial. 
• Women-Owned Businesses: Connect with WBENC-certified suppliers or work with organizations like Sigma Supply of North America. Consider creating accelerator programs specifically for women-owned businesses to boost their growth potential. 

By taking these proactive steps, you’re not only diversifying your supplier base but also contributing to the economic empowerment of these communities, which enhances the innovation and resilience of your own supply chain. 

2. Know Your History and Take Proactive Steps for Long-Term Supplier Diversity Success

Diversifying your procurement network is not just a box to check—it’s a strategic initiative that drives innovation, resilience, and competitive advantage. To truly support a supplier diversity program, business leaders must understand the historical and economic context behind these efforts. A deeper grasp of the history behind supplier diversity leads to more meaningful and lasting impacts. 

Here are key strategies to build an impactful supplier diversity program: 

• Host Supplier Diversity Fairs: Organize events where underrepresented suppliers can showcase their products and services, meet procurement professionals, and network with decision-makers. These fairs foster direct engagement between diverse suppliers and potential buyers, increasing visibility and building relationships. 
• Sponsor Training and Development Programs: Provide training programs that help diverse suppliers improve their business acumen, operational efficiency, and competitiveness. By sponsoring such initiatives, you ensure that suppliers have the tools they need to grow and thrive in the long term. 
• Leverage Technology to Find Underrepresented Suppliers: Use digital platforms and supplier databases to identify and connect with minority-, LGBTQ-, veteran-, and women-owned businesses. Technology can streamline the process of sourcing diverse suppliers, enabling you to broaden your network and uncover hidden talent in underrepresented communities. 

Building Pipelines: Mentorship and Upskilling 

A crucial part of a successful supplier diversity strategy is ensuring that diverse suppliers are not just one-time partners, but long-term contributors to your supply chain. To ensure sustainability and competitiveness, businesses should: 

• Mentor Diverse Suppliers: Establish mentorship programs where experienced professionals from your company guide diverse suppliers, helping them navigate procurement processes and scale operations. 
• Upskill and Develop Suppliers: Partner with diverse suppliers to offer targeted training in areas such as finance, marketing, logistics, or technology. Upskilling ensures that diverse suppliers can compete at higher levels and continue to grow within your supply chain. 

Why Supplier Diversity is a Strategic Imperative 

Understanding the historical context of supplier diversity is essential to appreciating its strategic value. Supplier diversity initiatives arose from efforts to address systemic inequities and create opportunities for underrepresented groups in business. Today, these programs are not just about social responsibility; they’re a business imperative that supports innovation, resilience, and market differentiation. 

Companies that actively engage in supplier diversity are better positioned to: 

• Adapt to changing market demands with innovative solutions from diverse perspectives. 
• Build more resilient supply chains by reducing dependence on a limited pool of suppliers. 
• Strengthen relationships with diverse communities, which can lead to greater brand loyalty and market share. 

To dive deeper into the historical significance of supplier diversity and how it can enhance your business strategy, check out educational resources from the National Minority Supplier Development Council (NMSDC). Their videos and materials provide valuable insights into the evolution of supplier diversity and its role in building a competitive, inclusive marketplace. 

By understanding the history and taking proactive steps to build pipelines, business leaders can ensure that their supplier diversity efforts aren’t just reactive measures, but part of a sustainable and strategic growth plan. 

3. Build for the Future: Metrics, Accountability, and Long-Term Commitment to Supplier Diversity

Diverse suppliers don’t need to comprise 100 percent of your supplier network, but they should be an integral part of your overall supplier strategy. To build for the future, your supplier diversity program must align with your sustainability, Environmental, Social, and Governance (ESG) commitments, and include clear goals, transparent metrics, and leadership accountability. 

Set Concrete Goals and Benchmarks 

Establish benchmarks to measure and guide your supplier diversity efforts. Analyze your current diversity spend and set realistic yet ambitious goals for the future. For example: 

• Diversity Spend Today: What percentage of your current spend is with diverse suppliers? Knowing your baseline will allow you to track progress over time. 
• Short- and Long-Term Goals: What is your supplier diversity goal for 2024? How about three to five years from now? Ensure these goals are ambitious but achievable, with incremental milestones to keep your company accountable. 

Track Key Metrics for Accountability 

To build a robust and sustainable supplier diversity program, tracking specific metrics is crucial. These metrics not only provide insights into your progress but also hold your leadership accountable for meeting diversity objectives. Key metrics to track include: 

• Percentage of Spend with Diverse Suppliers: Regularly track and report the percentage of your total procurement spend allocated to minority-, LGBTQ-, veteran-, and women-owned businesses. Set incremental targets to gradually increase this percentage. 
• Supplier Retention Rates: It’s not enough to onboard diverse suppliers—you need to ensure long-term partnerships. Track retention rates to measure how many diverse suppliers continue to work with your organization year after year. Retention shows that you’re providing value and fostering sustainable relationships. 
• Economic Impact: Measure the broader economic impact of your supplier diversity efforts. This could include tracking how many jobs have been created within diverse supplier businesses, the revenue growth they’ve experienced due to your partnerships, or the economic benefit to the communities they represent. 

Embed Supplier Diversity into ESG and Corporate Responsibility Reporting 

As companies become more focused on sustainability and ESG goals, supplier diversity should be an integral part of these initiatives. Make supplier diversity part of your corporate responsibility reporting to ensure transparency and accountability. Publicly reporting your progress demonstrates your commitment to inclusion and social impact, while also allowing external stakeholders to monitor your achievements. 

• Annual Reporting: Include supplier diversity metrics in your annual sustainability and ESG reports. Highlight your progress toward diversity goals, any challenges you’ve faced, and the impact your efforts have had on underrepresented communities. 
• Leadership Accountability: Hold senior leaders accountable for achieving supplier diversity goals. Tying diversity progress to executive performance evaluations and compensation can further reinforce the importance of these initiatives. 

Partner with Local Diversity Groups 

One of the best ways to meet your supplier diversity goals is to collaborate with local diversity groups and advocacy organizations. These groups can help you source diverse suppliers in your region and provide access to a network of businesses that may otherwise be difficult to find. Additionally, consider forming partnerships with organizations that focus on mentorship and development for diverse suppliers. 

According to a supplier diversity report by The Hackett Group, successful companies are those that “develop supplier partnerships, mentor local suppliers, collaborate with suppliers on product innovation, and share their experiences with other companies.” By actively engaging in these practices, you’ll ensure that your supplier diversity efforts are not only effective but also deeply embedded in the communities you serve. 

Building for the future requires more than good intentions; it demands concrete action, measurable progress, and accountability. By establishing clear goals, tracking key metrics, embedding supplier diversity into your ESG commitments, and fostering meaningful partnerships, you can create a sustainable supplier diversity program that drives long-term value for your organization and the communities you support. 

4. Remain Patient and Committed: Leadership and Collaboration Drive Supplier Diversity Success

Cultural change doesn’t happen overnight, and supplier diversity is no exception. Leadership accountability and cross-functional collaboration are key to making meaningful progress. Supplier diversity must be ingrained in corporate culture, with executives leading the charge and all departments working together to achieve diversity goals. 

Leadership Accountability 

Executive leadership plays a pivotal role in embedding supplier diversity into the fabric of your business. Leaders should set the tone by integrating supplier diversity into long-term business objectives and ensuring these efforts align with the company’s overall mission. To foster a culture of inclusion, leaders can: 

• Tie Diversity Efforts to Business Goals: Supplier diversity should not be treated as a separate initiative but as part of your company’s broader strategy. Link supplier diversity to revenue growth, innovation, and risk management to ensure it becomes a core part of business planning. 
• Lead by Example: Executives must champion supplier diversity efforts, setting clear expectations for the entire organization. Leadership accountability ensures that diversity goals are priorities and progress is regularly evaluated. 

Cross-Functional Collaboration 

Supplier diversity programs thrive when all departments work in harmony. From procurement to finance and marketing, collaboration ensures that diversity goals are met across the business. Strategies to promote collaboration include: 

• Diversity Council Meetings: Regularly scheduled meetings with a cross-functional diversity council help maintain focus on supplier diversity goals. These meetings provide a forum for tracking progress, sharing insights, and aligning on next steps. 
• Frequent Progress Updates: Transparent communication and frequent progress reports keep everyone in the loop, fostering accountability at all levels. Regular updates ensure that momentum is maintained and that any challenges can be quickly addressed. 

The Role of Technology in Advancing Supplier Diversity 

Supplier diversity can also benefit significantly from technology-driven innovations. Tools like AI and advanced procurement platforms streamline the process of discovering, assessing, and managing diverse suppliers. Here’s how technology can elevate your supplier diversity efforts: 

• AI-Powered Supplier Discovery: Use AI-driven platforms to identify underrepresented suppliers and assess their qualifications efficiently. These tools can analyze supplier databases, offering new insights and enabling you to uncover diverse businesses you might otherwise miss. 
• Relationship Management Tools: Leverage technology to manage supplier relationships with a focus on mutual growth. Platforms that track supplier performance, growth potential, and alignment with your diversity goals can help maintain and strengthen these partnerships. 
• Data-Driven Insights: Technology provides valuable data for tracking progress, assessing the effectiveness of your supplier diversity efforts, and identifying areas for improvement. With clear insights, leadership can make informed decisions and refine strategies. 

Stay Focused for Long-Term Change 

Patience combined with leadership and collaboration drives real change. A supplier diversity program that is consistently championed by executives and supported across departments is more likely to succeed. While the process may take time, the commitment to fostering an inclusive culture will yield long-term benefits for both the company and its partners. 

With decades of experience in helping organizations achieve supplier diversity goals, Broadleaf can assist you in building a sustainable, inclusive supplier base. Ready to get started? Contact us today! 

This blog was authored by Joseph O’Shea, Vice President of Client Delivery.