Putting together a supplier development program may seem daunting. You hear about other companies providing access to capital or guaranteeing contracts, but big-ticket development items like those are beyond your capabilities.
Don't worry—you probably have the framework already established within existing initiatives and practices; they just haven't been labeled as such. With a little planning, organization, and goal-setting, you can establish an informal supplier development program that works to strengthen and support your small and diverse suppliers.
What does an informal supplier development program look like?
An informal supplier development program is one that doesn't require much by way of additional resources. Often, companies already have an employee development program that can be adapted—or even presented unchanged—for small and diverse suppliers. For example, you may have internal training for employees that could benefit suppliers as well, such as best practices and company culture. Leverage the resources that you've already spent time and money creating and invite suppliers to participate.
Share information about your industry with your suppliers that they may not have access to otherwise in order to help them see the bigger picture. BP North America recently began inviting a select group of suppliers to be its guests at the annual Offshore Technology Conference, giving them access to information about BP's technology and an outlook on the energy industry, as well as a view of the entire industry from their energy-industry peers. With a clearer picture of the energy industry as a whole, BP's suppliers are better able to collaborate with the energy giant during a period of low oil prices and industry cost-cutting.
If hosting suppliers at an industry event is not feasible, consider having a high-level member of your procurement or supplier diversity team distill similar information into a presentation that can be accessed via your supplier portal.
Another valuable aspect of industry events is the opportunity to network. Invite suppliers to Chamber of Commerce events, minority supplier development council meetings, and other networking opportunities. Give your suppliers an added boost by making introductions to other potential customers.
Are you ready to level up your supplier development program?
Mentoring initiatives can provide a high ROI for participants on both sides of the table. Engage the C-suite by developing a mentoring program and matching executives with diverse suppliers. During reorganization under Chapter 11 bankruptcy, American Airlines was unable to change suppliers, so it focused on building relationships with its current suppliers. Through mentoring relationships, American Airlines provides insight to help position these companies competitively to win business both within and outside of American Airlines.
Organize an event, such as a half-day seminar about the company’s procurement process and upcoming opportunities, and bring in buyers from different departments to speak with diverse suppliers. Many Fortune 100 and Billion Dollar Roundtable companies host events that combine education about the procurement process with matchmaking opportunities several times a year for various groups of suppliers.
Many times, small- and minority-business executives would benefit tremendously from receiving formal executive training, but are unable to afford the expenditure. Consider offering a scholarship for a Woman Business Enterprise (WBE) to attend the Tuck-WBENC Executive Program at Dartmouth’s Tuck School of Business or a Minority Business Enterprise (MBE) to attend a Kellogg School of Business Executive Education Program. These week-long intensive programs are designed to help executives streamline operations, gain insight into their companies’ financial health, and create plans to build capacity, all of which will benefit your supply chain.
Stronger, healthier suppliers mean a stronger, healthier supply chain. No matter the size of your supplier development program, you can build on what's already happening within your organization in order to strengthen and support your suppliers.