The Competitive Advantage of Supplier Diversity
Sponsored More and more businesses are committing to supplier diversity programs and mentorships, and the results have been exciting — for both the company and their suppliers.
There’s little question that supplier diversity programs are important — and beneficial. Not only do they make economic sense — studies have shown that such programs have a return on investment of about $3.6 million for every $1 million in procurement operation costs (Diversity Best Practices, “The Profit of Supplier Diversity,” September 2017) — they also offer a host of other benefits.
“For us, it’s an opportunity to be inclusive, and it’s a reflection of our support of the communities in which we operate,” says Phyllis James, executive vice president and chief diversity and corporate responsibility officer at MGM Resorts International, “because if you are strengthening the economic position of businesses in those communities, you're helping indirectly to create jobs and help enlarge the economic base of the community.”
A deep commitment
MGM Resorts International has a long history of supporting supplier diversity. “We were the first in our industry to enact a formalized supplier diversity program,” notes Stacey Taylor, senior vice president and chief procurement officer. “Back in 2000 our company launched a voluntary diversity initiative, and supplier diversity emerged from that.”
“Supplier diversity provides suppliers an opportunity to be competitive within the marketplace,” says Kenyatta Lewis, executive director of supplier diversity. Lewis also leads MGM’s Supplier Diversity Mentorship Program, wherein businesses participate in an intense SWOT (strengths, weaknesses, opportunities, threats) analysis. “Based on what their top priorities are, we match them with a mentor here at MGM, vice president-level or above, in or close to that capability,” says Taylor. “We're in our third session now, and the first two graduating classes I think would tell you it’s been wildly successful because of resulting improvements to their businesses.”
“There are other mentoring programs,” she adds. “But we really feel ours is special.”
An ongoing relationship
Oscar Aliaga, president and CEO at Codale Energy Services & Supply, Inc., was a recent participant in the mentorship program. “The program was critical to the success of my company,” he says. “The tools and guidance that I was able to obtain from my mentors, MGM workshop facilitators, as well as the diversity team were absolutely instrumental.”
For Aliaga, one of the main benefits of the mentorship program is the opportunity to expand his network. “They continue to promote opportunities for networking — they try and connect small businesses with these professionals so they can have more access to quality companies.”
One of Aliaga’s MGM mentors was Russ Davis, vice president of construction. “Networking is probably the biggest opportunity,” Davis agrees. “I introduce them to other business leaders that give them opportunities to look to; instead of putting all their eggs in one basket it allows them to diversify and work with even MGM Resorts competitors.”
Davis stresses the open-ended nature of the relationship. “I still mentor one of the participants from the first class to this day,” he says. “It's just an ongoing relationship that will last indefinitely. It's been just as rewarding for me as it has for them.”
"If you are strengthening the economic position of businesses in those communities, you're helping indirectly to create jobs."
Lewis and MGM Resorts are so proud of what they’ve accomplished with the mentorship program that they’re planning to launch a special branding campaign for it. Lewis observes, “We want to showcase the program’s guiding principles ― promoting relationships, inspiring diversity through education and instilling pride about being a supplier to MGM Resorts.
Aliaga, for one, is all in. “I would definitely recommend the program. Small business owners, we think we know it all after a few years, but there's so much more that we can learn, and they kind of expose that in the workshops. I highly recommend it.”