The Spartacus Group (TSG)
Building the People to Profit Chain
SupplierDiversityROI.com

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MOVING FROM COMPLIANCE
TO VALUE CREATION

Supplier diversity has often been seen by many organizations as a compliance issue that has social justice implications.  Many leaders have been quoted as saying they value the way their supplier diversity programs have helped small and disadvantaged businesses grow in ways that have helped their communities.  These ‘socially’ redeeming values have benefits that impact everyone, however, in the current economic environment this rationale is not a valid strategic goal for most organizations, when looking at programs that are cost centers versus profit centers.

Historically, supplier diversity has been positioned as a compliance program.  Customers and vendors often have contractual expectations for their business partners that included tracking and quantifying their efforts to diversify their supply chain sources.  The cost and effort to comply with these contractual requirements have caused many organizations to view their supplier diversity efforts as a cost center and not a profit center.

As more organizations evaluate their expenditures, in an effort to reduce costs and grow the bottom line, it is becoming a more unyielding sell to get leaders of the organization to perceive the supplier diversity program as a value-added component relative to the bottom line, top line and/or pipe line.  Keep in mind that the growth of minority-owned firms has outpaced the growth of any other small business segment.  And while the complexity of effective supplier diversity programs also appears to be expanding, it would appear beneficial for organizations to examine their individual supplier diversity continuums. 

In recent studies, The Spartacus Group engaged in efforts to determine whether there were strategic business drivers impacted by the existence of robust supplier diversity programs.  In discussions with the Houston NMSDC President for the last 20 years, Richard “Dick” Huebner, there were several aspects of strategic business practices that could be of value to the supplier diversity professional as well as the MBE’s who think outside the box when looking for ways to leverage the benefits of supplier diversity.

The results of the Spartacus Group efforts have provided significant strategic linkages between the existences of a supplier diversity strategy that incorporates the best practices associated with a state of the art program.

KEYNOTE SPEAKER AT NMSDC CONFERENCE SPONSORED BY MAGIC JOHNSON ENTERPRISES