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With the onset of the COVID-19 pandemic, the supply chain landscape has changed. Companies have seen their supply chains disrupted at a scale unlike anything witnessed in a long time. With that said, there are a number of steps companies should be trying to take for the sake of overcoming the impediments that comes with a global pandemic.

One of the most significant among them being strengthening their supplier relationships. Whether these relationships are new or old, what matters is that they display mutual value. In this trying time, it’s as critical as it’s ever been that companies build something with their suppliers that lays a foundation for a resilient supply chain. For now and the future.

This article by Morai Logistics highlights the 5 most significant markers of a strong supplier relationship.

Mutual Respect

No relationship can be long lasting in its success without a feeling of respect going both ways. Part of this respect will come from a company’s and a supplier’s reputation. If they’re both in good standing, a degree of underlying respect will emanate from that. However, respect is also a mindset. If supply chain leaders don’t go into talks with their suppliers with integrity, even a healthy reputation might not be enough to keep the respect from diminishing in the relationship.

Collaboration

Collaboration plays an integral role in supply chain success. As such, it’s no surprise that that extends to suppliers as well. It doesn’t matter how strong a supply chain is independent of its suppliers. Nor does it matter how reliable a supplier is if they aren’t aligned with their customers. Companies and their suppliers have to have a shared vision.

It is only through that collective vision that each party can get the most out of their relationship. What’s more, by not allowing the relationship to devolve into a back and forth struggle, a company’s supply chain efficiency goes up considerably.

Transparency

Communication is central to a healthy relationship. As obvious as that might be, what’s a little less so is how to go about communicating effectively. Perhaps the most vital component for doing so is transparency. In no small part it’s important because it shows respect, which, as mentioned earlier, plays a huge role in a healthy relationship. It also shows trust, good faith, and a great deal more.

The following from an article by Supply Chain Dive explains,

Transparency means full disclosure of any obstacles, intentions, limitations and issues you’ve discovered — in-house or anywhere in the supply chain — as soon as possible. It’s also productive to offer, in good faith, to work together to fix them.

Technological Investment

Supply chains always need to be innovating. Now as much as ever before. Moreover, that innovation has to be holistic. That means including suppliers in any advancements that are being engineered. Investing in the latest and greatest in technology together is not only mutually beneficial from the standpoint of what the technology brings. An added positive that arises from it is that it creates a sense of shared prosperity.

Attend to Yourself First

Finally, perhaps the most straightforward mark of a strong supplier relationship comes with internal competency and success. After all, if a company is profitable to work with and gives a supplier a competitive edge, then that’s as strong a reason as any as to why a supplier will want to continue working with them. The same is true the other way around, in the case of a highly successful supplier. In success, a stronger relationship is formed organically.

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There is a growing urgency for Canadian businesses to incorporate supplier diversity programs into their own models. Not only do these initiatives build a social, economic and sustainable brand, they also help companies thrive in changing markets. The Conference Board of Canada describes these programs as the added value small and medium-sized businesses owned by women and minorities give to organizations and the economy.

Over the last month, media has placed the spotlight on the advancements women are making in various industries, including technology and supply chain.

The above headlines identify the importance women play in accelerating the industry, and their positive impact on business growth. This article outlines the benefits of supplier diversity programs and why Canadian businesses should work diligently toward adopting them into their models.

Supplier Diversity in Canadian Business

According to the Conference Board of Canada, supplier diversity programs are currently implemented into 39% of organizations throughout the country. In comparison to small enterprises, large organizations and companies within the private sector are more likely to implement these initiatives.

In a featured article for EBN online, Kelli Saunders spoke about supplier diversity, and the liberal government’s proposed investment into diverse suppliers. There is a push for the Canadian and U.S governments to increase procurement support for diverse suppliers including businesses owned by women and minority groups.

Procurement Leads to Change

Although procurement programs are currently available, there are reasons why women-owned businesses have yet to leverage procurement opportunities. These include:

• Lack of awareness
• Cost and administration
• Lack of confidence in contract opportunities

However, the Governments proactive support in procurement of supplier diversity is a huge step forward. According to Conference Board of Canada, it’s important that large municipalities recognize and address the benefits of supplier diversity

Benefits of Supplier Diversity Programs

The benefits of implementing supplier diversity programs include building strong supply chains, increasing competitiveness and establishing corporate social responsibility.

1. Corporate Social Responsibility

One of the most beneficial outcomes of implementing a supplier diversity program is establishing corporate social responsibility (CSR). Global Affairs Canada defines CSR as “the voluntary activities undertaken by a company to operate in an economic, social and environmentally sustainable manner.”

Large scale companies, such as TD Bank Group, have implemented supplier diversity programs as a CSR effort. Diversifying business portfolios help companies leverage ‘shared value and social licence’ in global markets.

2. Competitive Advantage

A key competitive advantage for any business is having a socially diverse and inclusive business model. Working in conjunction with CSR, Forbes also proposes that promoting diversity differentiates a company’s brand while increasing consumer engagement. In comparison to brand names, Customers are increasingly attracted to companies that give back to their communities and the environment. As a business diversifies, their relationship with stakeholders and markets diversify, developing price and service level competition as well.

3. Economic Growth

Investment into social diversity programs also has a tremendous impact on the growth of the economy. In fact, the Conference Board of Canada states that ‘nearly 1 million Canadian women business owners’ contribute to ‘more than $117 billion annually to the Canadian economy’. In addition, engaging in business with diverse suppliers means opening up to new markets which translates into economic development.

Moving forward, the investment into social diversity programs is an integral component to the business model of any company. The procurement of funding into women and minority-owned businesses would create positive change and contribute to social and economic success.

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Supplier diversity has been an issue for several large businesses, especially those involved in tech. While supplier diversity is an initiative that everyone agrees is important, how it should be implemented is less obvious.

Google’s innovative approach to supplier diversity is interesting. Although still ongoing, it’s program is structured in such a way to address what have been common barriers to other supplier diversity efforts by other companies.

Why Should We Care About Supplier Diversity

Although supplier diversity has ethical and moral benefits, it also results in a positive ROI when implemented well. According to CM Solutions, commitment to supplier diversity also benefits a company in the following ways:

• Promotes innovation through the entrance of new products, services, and solutions
• Provides multiple channels from which to procure goods and services
• Drives competition (on price and service levels) between the company’s existing and potential vendors
• Allows a company to take advantage of new opportunities for business expansion with the emergence of new consumer needs based upon shifting demographic realities
• Displays an organization’s commitment to doing business, beyond consumerism, in diverse markets
• Showcases the company’s interest in and commitment to the economic growth of all communities

Google’s Supplier Diversity Program

The genesis of Google’s Small Business Supplier Diversity Program is lengthy, but interesting. Its entire history as written by Adrianna Samaniego, Adam Gardner, Chris Genteel and Leonard Greenhalgh, can be read here.

Launched in late 2014, Google’s aim with the program is to:

1. Connect more Google employees with diverse-owned small suppliers
2. Connect those diverse businesses to opportunities within Google
3. Help those suppliers grow on the web and improve their business skills, and finally
4. To foster innovation at the supply-chain level.

Google has three criteria for participation; the business is U.S based, annual revenue is $15 million or less, and that the organization have 50 or fewer full-time employees.

Lessons Learned

Remove barriers—Unlike other supplier diversity programs, Google’s doesn’t require certification. It discovered that companies didn’t have the time to spend on completing applications and updating certifications.

“The [Google’s Supplier Diversity] application encourages all minority-owned, women-owned, LGBT-owned, disabled-owned and veteran-owned businesses, as long as they fit the other criteria” writes this Supply Chain Management Review article.

It takes work — Several high-level Google employees devoted 20% of their individual work weeks to build the program. Likewise, the Supplier Diversity team attended around 20 events across 20 states and cities in a single year to encourage and train participants.

Communication is key — Google promises suppliers that when they entered their information or queries into the relevant portals, that they’ll respond within two weeks. This included replies to tax information, and documentation.

Google also clearly lists the benefits of participation. It isn’t just the potential for business that these suppliers should expect. They also receive discounts on AdWords, faster payment from participating suppliers, and access to a course that improves their business skills.

Diversity is a benefit to everyone, but implementing programs that encourage it has been a problem for many. Google’s supplier diversity program is still ongoing, but it can still help others by acting as a road map.

As SupplyChain247 puts it:

[Diverse companies] are better able to win top talent and improve their customer orientation, employee satisfaction, and decision making, and all that leads to a virtuous cycle of increasing returns.

If you liked this blog post, why not subscribe to our blog? If you’re interested in what we do as a 3rd party logistics provider, don’t hesitate to check out our services (as expressed above, we are very pro finding you the lowest total cost!). We’re also in the twittersphere, so give us a follow to get the latest logistics and supply chain news.

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The benefits of supplier diversity go beyond the “social good.” We are now at an age where companies are starting to find that supplier diversity programs can be fiscally beneficial. A study from the Hackett Group showed that companies that “focus heavily on supplier diversity” generated a 133% greater ROI when it comes to procurement than the typical business. And this is just the beginning, scroll down to see more facts about supplier diversity.

Supplier Diversity and the Logistics Industry

That’s it for us this week! If you liked this blog post, why not subscribe to our blog? If you’re interested in what we do as a 3rd party logistics provider, don’t hesitate to check out our services (as expressed above, we are very pro finding you the lowest total cost!). We’re also in the twittersphere, so give us a follow to get the latest logistics and supply chain news!

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On our last blog post, we wrote about the WeConnect Canada’s Opening Doors conference. WeConnect Canada distributes the Women’s Business Enterprise (WBE) certification for majority owned, and controlled women’s businesses. The conference is about how certifications such as the WBE is a great strategy for creating opportunities to provide a competitive edge for bidding on corporate contracts as part of supplier diversity programs.

But what is supplier diverstiy? According to WeConnect Canada:

Supplier diversity is all about building relationships and trust to enable business opportunities between corporations and historically under-utilized groups, like women business owners.

In essence, Supplier Diversity programs were creative to give minorities an opportunity to secure contracts with government agencies, major companies and corporations as qualified small business owners. This has come about a reaction to minority and women owned businesses being classified as under-utilized small business owners in order to promote balance and diversity for participating organizations.

In the United States, the Supplier Diversity program was conceptualized in 1953 along with the establishment of the Small Business Administration. The federal government’s efforts to create opportunities for often underrepresented small businesses was a natural segway into providing those same opportunities for minority groups, such as women-owned businesses.

These days a majority of large companies are indeed looking into how to incorporate minority-owned businesses into their partnership agreement and this is especially the case in the logistics and supply chain industry. The biggest challenge is discovery; large corporations have trouble identifying women-owned businesses. Hence the creation of certifying networking organizations such as WEConnect.

These types of certifications allow large corporation to find these companies and take advantage of the following benefits:

A Ready and Capable Force to be Reckoned With

Women-owned businesses are an untapped force to be reckoned with. There are 6.5 million majority women-owned businesses in the United States, employing 7.1 million people according to the U.S. Bureau of the Census. Large corporations agree that there is a strong business case for investing in women; a recent McKinsey & Company survey results showed that 35% of senior executives reported efforts to empower women in emerging markets led to increased profits with an additional 38% reporting an increase in profits in the future. This is even more emphasized in the world of logistics, a well known gentleman’s club but is slowly changing due to the benefits that partnering with diversity suppliers can provide, which brings us to our next point:

Unique Opportunities from Unique Expertise

Businesses that are primarily female-owned are often noted for their ability to have a unique view of the industry and can offer a fresh take on not just the ideas involved in the process but the along every step along the business process. Traditionally only seen in the service sector, women-owned enterprises are now in many specialized industries such as manufacturing, construction, and other industrial fields. This is evident in the efforts that large corporations like Cisco are taking steps into providing the most sustainable means to empower women through supplier diversity and inclusion.

And that’s all for us this week! If you liked this blog post, why not subscribe to our blog? If you’re interested in what we do as a 3rd party logistics provider, don’t hesitate to check out our services (as expressed above, we are very pro finding you the lowest total cost!). We’re also in the twittersphere, so give us a follow to get the latest logistics and supply chain news! To find out more about WEConnect and getting certified as a Women’s Business Enterprise (WBE), visit their site at www.weconnectcanada.org

BONUS: Check out Inc.com’s Top 10 Women-run Companies!

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WEConnect Canada is an organization that certifies majority owned women’s business and facilitates opportunities for those businesses to meet buyers and get access to bids for corporate contacts as part of supplier diversity programs. Their mission is to:

…[advance] the success of certified women business enterprises and corporate members to drive economic growth and prosperity through supplier diversity.

First Impressions

As I walked into the Hyatt Regency in Toronto to check into the conference, I already saw members in the lobby openly conversing. I went up the escalator to where the actual conference was taking place and noticed an overwhelming feeling of openness and support. Everyone I ran into at the conference was both welcoming and friendly, regardless of whether or not they were attendees, speakers, or organizers of the event.

But I also noticed a sense of empowerment; there was a sense of camaraderie not usually present in networking conferences I’ve been to in the past. As I entered the conference hall I saw Kelli Saunders, the president of Morai Logistics sit down at the front of the room along with Marty Britton of Britton Management Profiles and Marla Kott of Imprint Plus. I picked a seat near the front and listened to them talk. My takeaway is as follows…

Diversity Supplier: More Than Being the Sprinkles to the Cupcake

All three of the women offered some sage advice both for people who have already established and successful businesses as well as for those who are just starting out their entrepreneurial pursuit. The experiences that these women have shared were not only valuable, but also eye-opening to those who have been wondering about how businesses can take off and the importance of a good network.

Mary Britton spoke of the importance of knowing how to work in your business as opposed to working on your busines. As someone who’d seen her company take off and really grow, Mary had to learn how to trust her team and to allow herself to focus on the expansion of her business. She also made a really important point keeping a company lean and not to fear outsourcing. Marla Kott on the other hand, spoke of learning a company’s ecosystem if you ever intend to work together with them. This can make streamlining and cooperation between two companies run more smoothly.

Kelli Saunders spoke of the importance of networking; making connections is the way to get your foot in the door for future clientele. She also emphasized the importance of mentorship and joining organizations like WEConnect so that you can get that foot in the door.

But the most important point that all three speakers bestowed upon the audience that day was the fact that as a business owner, you have to be aware of the tools that are present to you. One of the most important tools for women-owned businesses is certification of supplier diversity. Morai Logistics is part of WEConnect as a certified Women’s Business Enterprise (WBE). This is important as this certification is the only Canadian certification of women-owned businesses and critical to maintaining supplier diversity for companies – something that can be appealing for companies in the logistics and supply chain industry who want to actively promote supplier diversity in their network of partners and clients.

All three women that spoke noted the importance of WEConnect’s WBE certification as something that greatly facilitated their business growth. But the important thing to note is that a certification should not be solely relied upon. As Kelli Saunders, put it:

In the cupcake that is your business, where the cupcake and the frosting are your performance and your team, having a diversity supplier certification is just the sprinkles. You still need to have an excellent cupcake that should stand out more than anything else, the sprinkles are just the bonus that entices the buyer from making that final decision between your cupcake and someone else’s.

Thanks for reading my guest blog post! If you are interested in how Morai Logistics can take the chaos out of your supply chain, check out their services section! If you want to stay updated on their content, why check out the rest of their blog or follow them on Twitter at @MoraiLogistics!

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