Management

Business Diversity Programs Create Social and Financial Benefits

Incorporating a wide range of suppliers creates equity and keeps money in local communities.

Kristin Malek serves as the Global Director of Business Diversity at CDW and the architect of CDW’s diverse supply chain with more than 1,100 suppliers. Malek ensures CDW’s continued investment in diversity, equality and inclusion within their businesses. She is responsible for the firm’s total spend with diverse partners that in 2021 reached more than $20 billion.

Mohammed Hussain

Mohammed Hussain is the Senior Manager of Business Diversity at CDW. He is a business solutions expert who is influencing the supply chain in a meaningful way and ensuring the Business Diversity program at CDW is revenue enabling for all its diverse partners, customers and partner ecosystem.

Business diversity programs — socially conscious organizations supporting small businesses led by entrepreneurs in traditionally underrepresented communities through deliberate purchasing decisions — are hardly new, especially in higher education.

These types of programs trace their roots to the civil rights movement of the 1950s and 1960s, and many colleges and universities were quick to embrace supplier diversity, either as a form of thought leadership or because of government requirements put in place at the federal, state and local levels that mandate some amount of diversity or equal opportunity in procurement decisions.

Now, however, more than 60 years later and in the wake of civil rights protests throughout the country, a renewed focus has been placed on supplier diversity programs. That’s led to a wave of businesses and other institutions — including those in higher education, like Carnegie Mellon University — pledging once again to do their part to support local, minority-owned businesses through supplier diversity.

Organizations are realizing that having a diverse supplier base isn’t just the right thing to do from a social point of view; it’s also good for business, and there are a number of reasons why. One is the need to build trusted relationships with their own customers, communities and businesses all over the U.S. People also now expect organizations to do more than just turn a profit. Instead, they want them to have a positive impact on society too, a trend that has been accelerated by the events of the past few years.

At CDW, our Business Diversity Program is based on commitment from top-down management and partnerships with a huge range of small and diverse firms offering a wide variety of products and services. That’s why we talk about the broader context of business diversity, not just supplier diversity, and it’s how we’re helping create economic opportunity, impact and inclusive growth at scale.

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What Constitutes a ‘Diverse’ Supplier?

By most definitions, a diverse supplier is at least 51 percent owned by someone in an underrepresented community. That can include members of the Black, Hispanic, women’s, veteran, disabled and LGBTQ+ communities, among others.

Many of these businesses are also small businesses. Locally owned small businesses were hit particularly hard during the pandemic years, when small businesses nationwide were decimated and a higher percentage of Black-owned businesses were hurt compared to their white-owned counterparts.

In the pandemic’s early days, this created a kind of micro-level supplier diversity program within individual households, when we were all urged to buy local, order carryout food and do whatever we could to support local businesses that were losing customers because of lockdowns and other safety measures. By spending locally, we were able to see some of the impact our decisions could have.

On a smaller scale, when IT departments at colleges and universities with large budgets make decisions to spend their dollars with underrepresented businesses, it can be a game changer for those business owners.

In 2021, CDW reorganized our U.S. program into distinct geographical regions, each with a dedicated regional leader. As well as making us more agile and effective in identifying and mentoring new diverse partners, this approach allows us to gain a deeper understanding of the unique challenges, opportunities and economies of scale each region faces. We then use these insights to inform and tailor our business diversity strategy, boosting both performance and impact.

LEARN MORE: How to use analytics in support of university DEI goals.

Financial and Practical Benefits of Supplier Diversity

Committing to a diverse workforce and other diversity, equity and inclusion initiatives is critical for creating an equitable world, but it’s only part of the solution. Having a diverse supply chain that supports diverse small businesses puts money in those businesses’ pockets, and money matters.

But there can be economic and operational benefits to the purchasers, as well, something that became more apparent during the supply chain crisis of the past few years.

It no longer makes sense for purchasers to stick to a single supplier, even one that can meet all a college or university’s needs, because a disruption can be overly impactful. CDW has worked with colleges and universities like the City University of New York and Texas Tech University to bring in value-added solution providers.

In addition, higher education institutions have become more focused on supporting their own communities as a matter of public service, keeping their purchasing dollars nearby to grow the local economy. Investing in local businesses is a direct way to create local wealth that can, in turn, support higher education.

Some institutions have even taken the relationship further, creating mentorship programs for students with local and minority-owned businesses to enhance educational programs and opportunities for students.

If developing a supplier diversity program is part of your organization’s leadership plans, CDW can help build a mindful and successful program for your organization, no matter where your organization is on its journey.

This article is part of EdTech: Focus on Higher Education’s UniversITy blog series.