While efficiency will always be critical in quality supply chain management, what determines the success of a client’s supply chain will evolve over time, and adjustments may be required.
That was the case for our client, a leading global technology company. Over the course of our 12-year partnership, Allegis Global Solutions (AGS) had collaborated closely with our client to drive supplier optimizations. The result was a leaner, better-aligned supply chain to source and retain top talent.
But when we met with our client’s US-based stakeholders about the company’s evolving diversity goals we knew there was opportunity to impact equity within the supply chain serving their managed service provider (MSP) program. We discussed what changes could be made to the supply chain to meet their goals, and, specifically, grow relationships and spend with Black/African American-owned suppliers.
To adjust our client’s supply chain strategy to make a meaningful impact on diversity spend, AGS’ Supply Chain Management team leveraged the program’s supplier data and proven success stories from other AGS programs that had implemented these suggestions to reach similar diversity goals. As a result, the team developed a two-phase approach to supplier optimization.
At first, our team focused on the quality of the supply chain by removing the low-performing suppliers and being more thoughtful when adding new suppliers. Specifically, we removed suppliers demonstrating low engagement through response rates and poor performance based on the quality of submittals and number of starts. With a more streamlined and effective supply network in place, AGS also onboarded three additional Black/African American-owned suppliers to ensure the supply chain had sufficient representation when receiving job requirements.
Phase two was all about ensuring equity in the receipt of requisitions, which included leveraging the program’s vendor management system (VMS) to direct more opportunities to Black/African American-owned suppliers and increase visibility for diverse-owned suppliers.
Since the implementation of these strategic and operational solutions, the program has seen significant success through its collaborations with Black/African American-owned suppliers. Data points from fiscal years one and two indicate that through our supply chain optimizations, we were able to help our client increase spend with Black/African American-owned suppliers by 170% to $5.4 million in spend. This increase in spend correlates to a 333% surge in starts from Black/African American-owned suppliers.
By partnering with our client to first understand their DEI goals and then create a way to impact marketplace equity through their supply chain, we were not only able to help them get work done, but also embed DEI as an essential part of their workforce strategy.