While DE&I initiatives are often a focus in permanent workforce strategies, they are frequently overlooked in contingent labor programs. The temporary and short-term nature of contingent workers, coupled with limited visibility, often leads to a lack of attention to DE&I in this workforce segment. Since many contingent workers are sourced through staffing firms, an effective DE&I strategy for contingent labor begins by ensuring a diverse supplier network.
What Is a Diverse Supplier?
A diverse supplier is a business that is at least 51% owned, operated, and controlled by individuals from traditionally underrepresented groups, such as women, ethnic minorities, veterans, people with disabilities, and LGBTQ+ individuals. Partnering with diverse suppliers in contingent labor provides access to broader talent pools, often including candidates who bring unique perspectives and experiences.
Why a Diverse Supplier Network Matters
With 85% of Fortune 500 companies adopting supplier diversity initiatives, integrating diverse suppliers into your contingent workforce strategy brings significant advantages that enhance both performance and impact.
- Access to a Broader Talent Pool: Diverse suppliers often have access to extensive talent networks, enabling companies to reach a wider range of candidates from underrepresented groups.
- Economic Equity and Social Impact: By directing business to minority-owned, women-owned, and other diverse suppliers, your contingent workforce strategy becomes a vehicle for driving economic empowerment and equity.
- Strengthening Brand Reputation: Companies known for actively supporting diverse suppliers often benefit from enhanced customer loyalty, improved brand perception, and a stronger corporate image. In fact, diverse suppliers are 3 times more likely to achieve high customer retention.
- Driving Financial Performance: The diversity of thought and innovation that comes from a varied supplier base helps companies become more agile, leading to better decision-making, increased productivity, and up to a 15% boost in annual sales.
- Meeting Corporate Social Responsibility (CSR): For companies with established CSR programs, building a diverse supplier network supports commitments to sustainability, ethical sourcing, and workforce inclusion.
- Risk Mitigation: A diverse supplier base fosters supply chain resilience and ensures continuity in the talent pipeline, especially during economic uncertainty or labor shortages.
Get Started: How to Grow a Diverse Supplier Network
Educate Internal Stakeholders
Companies that prioritize DE&I from the top down tend to see the most successful outcomes. Buy-in from leadership ensures that diversity initiatives are integrated at every level, making supplier diversity a standard practice rather than an afterthought. Provide training for leadership, HR, and procurement teams on the value of supplier diversity and its alignment with overall business goals.
Assess Your Current Supplier Network
Conduct a diversity audit to identify representation gaps in your supplier base. Use Vendor Management Software (VMS) to track and report on both tier 1 and tier 2 suppliers, providing a comprehensive view of your diversity spend.
Identify Certified Diverse Suppliers
Identify and engage suppliers from underrepresented groups through industry events, supplier diversity coalitions, and partnerships with diversity organizations like the National Minority Supplier Development Council (NMSDC) or Women’s Business Enterprise National Council (WBENC).
Evaluate Suppliers for DE&I Alignment
Evaluate potential suppliers' DE&I commitments by reviewing their internal diversity policies and practices to ensure alignment with your company's values. Include diversity credentials or certifications in Requests for Proposals (RFPs) and make diversity requirements part of your contracts. Ask all suppliers to complete a business classification form, listing their diversity certifications (e.g., minority-owned, women-owned)
Set Measurable Goals and Track Progress
Establish clear, measurable goals for increasing spend with diverse suppliers or expanding their role in your contingent workforce. Hold internal stakeholders accountable for achieving these goals and celebrate milestones to highlight the positive impact of these initiatives.
Building a diverse supplier network is a crucial part of building a more inclusive contingent workforce strategy.
LevelUP's Contingent Workforce Management (CWM) solution offers a fully managed service for contingent talent acquisition, management, and payrolling. As an MBE-certified organization ourselves, we are strongly committed to upholding DE&I principles in every program we manage. Our CWM programs are powered by a diverse, high-performing supplier ecosystem, ensuring that our clients benefit from top-tier talent while advancing their DE&I commitments. We also deliver detailed reporting on diversity spend and compliance, ensuring clients can easily track progress and meet their supplier diversity objectives.
