Top Supplier Diversity Programs Broaden Value Proposition To Drive Increased Market Share, Other Revenue Opportunities

The Hackett Group Research Also Shows That Virtually All Diversity
Suppliers Meet or Exceed Expectations

IBM, American Red Cross, and WEConnect All Spotlight the Value of
Supplier Diversity Programs

MIAMI & LONDON–(BUSINESS WIRE)–Virtually all diversity suppliers meet or exceed expectations, and top
corporate performers in supplier diversity experience no loss in
efficiency, according to new research from The
Hackett Group
, Inc. (NASDAQ: HCKT). In addition, they see improved
quality and often extract other benefits, including increased market
share and access to new revenue opportunities. The research challenges
the attitude of many business leaders, who worry that dedicating
resources to supplier diversity will divert attention from other
strategic activities.


To truly unlock the full potential benefits of supplier diversity
efforts, The Hackett Group recommends that companies consider expanding
beyond traditional goals such as complying with regulations. Top
performers in supplier diversity recognize the value of objectives such
as the ability to gain access to new markets and improve supplier
partnerships. In addition, companies should look beyond basic measures
such as the percentage of spend with diverse suppliers and calculate the
true value of supplier diversity by using more sophisticated performance
metrics such as satisfaction levels and other secondary metrics that are
aligned to long- and short-term plans and objectives.

Companies with top-performing supplier diversity programs focus on
several areas to make the most of their efforts, and go beyond the
basics, the research found. These companies develop supplier
partnerships, mentor local suppliers, collaborate with suppliers on
product innovation, and share their experiences with other companies.
They use supplier diversity as a reputation-builder to help increase
market share and retain talent, and rely on social media to develop
customer and brand awareness. They also actively educate internal
stakeholders on the value of supplier diversity, and interact with local
communities of suppliers and consumers to better understand the market,
establish relationships, and share supplier diversity goals.

While most supplier diversity programs have a domestic focus, The
Hackett Group’s research found that more than 40 percent of all global
companies with a U.S. supplier diversity program plan to expand globally
within the next two to three years. The Hackett Group recommends that
companies manage U.S. and global programs as a single initiative, where
appropriate. Partnering with corporate diversity groups, which manage
workforce diversity, is also highly advisable, as is working with third
parties that can help companies connect with diverse suppliers.

“Supplier diversity is evolving from a check-the-box corporate social
responsibility requirement to a strategic enabler providing access to
innovative products and increased market share in new and developing
communities,” said The Hackett Group Research Director Laura Gibbons.
“Top-performing organizations are taking advantage of this opportunity,
and applying the tenets of social diversity to new areas such as
supplier partnering, reputation management and global expansion with
exceptional results.”

“There are certainly challenges that need to be overcome,” cautioned Ms.
Gibbons. “It can be difficult to obtain the necessary support to invest
in supplier diversity programs. Business leaders often worry that
dedicating resources to this will impact procurement savings or even
quality. But our research clearly shows that this is not true. Top
performers are not seeing losses in efficiency, and quality often
improves. Overall, the risks to focusing on supplier diversity are quite
low, and the potential upside is significant. In fact, up to 10 percent
of sales come with supplier diversity requirements, suggesting that the
lack of such a program can even result in lost revenue.”

According to Michael Robinson, Program Director – Global Supplier
Diversity, IBM, “At IBM, we’ve been leading the way in corporate
supplier diversity efforts for nearly 50 years. Today, we’re the only
company, that we know of, which has a diverse supplier requirement in
every country where we operate worldwide. We count on our supplier
network, and ask the same thing of our women- and minority-owned
suppliers as we do of our majority suppliers…that they help us provide
value to the customer, strengthen our brand, understand our markets, and
identify what’s coming next in the world of technology. It’s in our best
interest to find the best suppliers, and a focus on supplier diversity
is an important part of how we do that.”

According to Jillnell Joiner, Senior Supplier Diversity Manager,
American Red Cross, “At American Red Cross, we’ve been very
focused on expanding our supplier diversity efforts over the past few
years, and communication has become a key best practice for us. We want
to make sure suppliers, including minorities, women and veterans,
understand that the door is open.”

“Some things are simple…if a supplier reaches out to us, we respond, no
matter what,” explained Ms. Joiner. “Last year we also did workshops in
15 states across the country, in partnership with the National Minority
Supplier Development Council, to help suppliers understand the extent of
our supplier diversity efforts, and how best to do business with us.
These workshops have been a great asset for us.”

According to Elizabeth A. Vazquez, CEO and Co-Founder of WEConnect
International, “Some of the most successful supplier diversity and
inclusion programs come from companies that have diversity and inclusion
in their DNA. They are making strategic investments in the communities
they serve not only in the U.S., but around the world. Global
corporations must be committed to utilizing the world’s best suppliers.
Smart companies will make a conscious effort to identify underutilized
suppliers in every market that can bring value, including businesses
owned by women, ethnic minorities, people with disabilities, members of
the LGBT community, and other groups.”

About The Hackett Group

The
Hackett Group
 (NASDAQ: HCKT) is an intellectual property-based
strategic consultancy and leading enterprise benchmarking and
best practices implementation firm to global companies. ýServices
include business transformation, enterprise
performance management
working
capital management
, and global
business services
. The Hackett Group also provides dedicated
expertise in business strategy, operations, finance, human capital
management, strategic sourcing, procurement, and information technology,
including its award-winning Oracle EPM and SAP practices.

The Hackett Group has completed more than 11,000 benchmarking studies
with major corporations and government agencies, including 93% of the
Dow Jones Industrials, 86% of the Fortune 100, 87% of the DAX 30 and 52%
of the FTSE 100. These studies drive its Best Practice Intelligence
Center™ which includes the firm’s benchmarking metrics, best practices
repository, and best practice configuration guides and process flows,
which enable The Hackett Group’s clients and partners to achieve
world-class performance.

More information on The Hackett Group is available at: www.thehackettgroup.com,
info@thehackettgroup.com,
or by calling (770) 225-3600.

Contacts

The Hackett Group
Gary Baker, 917-796-2391
Global
Communications Director
gbaker@thehackettgroup.com