What is Supplier Management? Top Benefits, Processes and Best Practices for Diversity

Diversity is a huge issue in the workplace and supplier management plays an important role. Diversity is about more than just race, it includes gender, age, socioeconomic status, religion and many other aspects of a person’s identity.

Supplier diversity refers to when suppliers reflect the same diversity as their customer base or target market. The benefits of supplier diversity can be seen from both sides-companies gain access to new markets while also improving how they are viewed by their customers.

This article will cover what supplier management consists of and how you can introduce best practices for supplier diversity into your organization!

What Is Supplier Management?

Supplier management is the process of managing a company’s suppliers in order to achieve long-term business goals. Suppliers are chosen based on their ability to provide quality goods and services at competitive prices, as well as their capability for innovation.

There are many benefits that can be seen from supplier diversity such as increased revenue opportunities due to new markets or improved customer perception about your organization.

It is the process of managing supplier relationships and ensuring that your organization is working with suppliers who provide goods or services at competitive prices, while also improving how they are viewed by their customers.

What Are the Benefits?

There are many benefits to supplier management, including increased revenue opportunities due to new markets or improved customer perception about your organization.

It can increase innovation for both parties because each will be able to see what the other offers and work together in order to come up with something different from what’s currently on the market.

In addition, it is a way for organizations to gain access into global supply chains which can lead them all over the world.

Lastly, maintaining diverse supplier networks provides these companies with more flexibility when dealing with changes.

Benefits of Supplier Diversity Management

The biggest benefit of supplier diversity comes through access into different markets which, when combined with an already established market base gives companies more opportunity for growth and success!

This includes being able to reach out beyond one gender, race or socioeconomic group while still providing products or services tailored specifically towards them. In addition it creates an opportunity for new ideas to be formed and implemented.

The Process of Supplier Diversity Management

There are many processes that can occur during supplier diversity management but the following highlights the basics as well as some best practices to consider when figuring out what your process will look like!

Conduct a supplier audit – Figure out who you’re currently using, what their capabilities are, where they come from etc., so you know how much work has been completed on this front already. This is important because it reveals elements of needs and gaps in supplier selection while also providing guidance through knowing if there’s an area in which suppliers need more focus (especially with regards to specific areas within contracts). It also helps identify any possible issues present such as overreliance on a single supplier for your supply chain.

Conduct supplier performance reviews – Ensuring that suppliers are performing well and are on track with promises made to their customers is critical as it minimizes costly delays in production, so make sure you conduct these at regular intervals (at the very least annually).

Source new suppliers – It’s important to not rely solely on existing suppliers but also find ones that can offer an expanded breadth of capabilities or those who specialize in certain needs such as high quality materials or innovative methods of production. This means identifying which type of supplier will be most helpful based off what you’re looking for and then conducting research into viable candidates before making any decisions!

Review contracts regularly – Supplier relationships require ongoing work and attention, and you’ll want to make sure that the contract is updated at least annually. This includes things like performing supplier audits (even with your existing suppliers) as well as negotiating new deals when necessary.