Are you considering DEI in vendor selection?

As CS, Revenue or Operational leaders we all have purchasing power, whether it's through shaping budgets or influencing/selecting vendors. In my pursuit to understand all the ways we can advance diversity, equity and inclusion I came across this firm Conscious Customers helping companies diversify their vendors. It's important work because:

Only 5.3 % of US Sales go to Black and Latin-owned businesses. 88% go to white-owned companies
The Median Black family owns 2% of the wealth of a white family. For Latin families - 4%
It puts your money where your company values are
Starting to ask potential vendors where they stand will normalize DEI as a value

In addition to the social good that comes from diversifying our professional networks, the Wall Street Journal published this metric from a 2006 study by the Hackett Group:

"Companies that focus on supplier diversity generate a 133% greater return on procurement investments than their counterparts that do not."

(I haven't been able to find more recent data on this - do you know of any?)

Has anyone considered DEI in your vendor selection process? How do you think about this?

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Comments

Brian Hartley

Hey Lauren - great topic. I don't think we actively consider it while making purchase decisions but I would agree that we need to add this to our evaluation criteria. Incremental changes will help move the needle over time

Nathan Byren

Hi Lauren,

Thanks for sharing this! It's not something I currently have any influence over however, as soon as I do it's something I will definitely bear in mind.

I think this should constantly be considered within a hiring context, a "what news/articles do I read" context, a "who do I consider socialising with" context and as you have just pointed out, a vendor selection context as well!

It's so easy to say that you will decide these things based on merit but without looking at what you or your company considers "merit" you're likely going to go with people that look or sound like you. If we want to create a more inclusive and diverse world then that thought process has to be challenged and diversity, equity and inclusion have to be actively pursued.

And those are my two cents

Nathan