Diversity in higher education is more than just students and staff.  There is a third piece to the diversity and inclusion puzzle that is equally important for colleges and universities: supplier diversity. 

Supplier diversity is a program which encourages the use of traditionally underrepresented or underserved groups as suppliers, such as small-business enterprises (SBEs), minority-owned business enterprises (MBEs), woman-owned business enterprises (WBEs) and more, and as many universities and colleges across the US have learned, there are numerous benefits to implementing and prioritizing a supplier diversity strategy.  

However, the tricky part these days lies in prioritizing supplier diversity while still grappling with the effects of the global pandemic. For example, many higher education institutions have turned their focus to financial issues, enrollment rates, budget cuts, reopening campuses, and more. Among all of the competing priorities, how can supplier diversity program managers at colleges and universities help to keep supplier diversity initiatives top of mind for the institution and its leadership?

We’ve compiled 4 tips that supplier diversity professionals can execute now to better support prioritizing supplier diversity in higher education:

1. Focus on the economic impact:

Colleges and universities across the US have incredible buying power and spend millions of dollars each year. By implementing a supplier diversity strategy it dramatically increases the number of potential suppliers and promotes competition, which can improve product quality and drive down costs. After all, more sourcing options equate to a more resilient and agile supply chain. Prioritizing a supplier diversity strategy supports growth and jobs, and the ripple effect of that on the local communities that universities and colleges operate in can be profound. 

2. Get buy-in from senior leaders:

In order for any supplier diversity program to be successful it’s not enough to have the buy-in from only a select few in the university.  It’s critical to have backing from senior leaders across the institution, such as: presidents, chancellors, and system governing boards. Oftentimes what is helpful in this approach is breaking-down the big picture and focusing on what each department or role may view as highly important, such as: emphasizing the economic benefits, impacts to the university’s bottom line, reduction in supply chain risk, supporting compliance, and improving reputation.  

3. Equip staff and spread the word:

Outside of your department, employees may not be up-to-speed on the university’s supplier diversity program.  Don’t be shy when it comes to sharing your goals and purpose in internal marketing programs to help spread the word – for instance communicating information about the program within your organization’s intranet, newsletter or other internal channels. Outside of your organization, participate in local supplier diversity councils, conferences, networking events and other outreach opportunities. Clearly promote opportunities on how to execute business with your college or university.  Reach out to other supplier diversity professionals to network and share insights and best practices. Celebrate your wins and promote what you are doing by applying for awards related to working with diverse suppliers, put out press releases and share your wins on social media. 

4. Get the right tools in place:

Without a way to effectively streamline and automate data gathering, tracking, reporting, vendor management and administrative processes, your supplier diversity program can only go so far.  If you’re ready to prioritize supplier diversity and take your program to the next level, it’s time to say goodbye to manually tracking diverse suppliers and certifications, dealing with questionable data accuracy and multi-system chaos, having limited or no visibility into multi-tier diverse spend, or working until the eleventh hour to create and submit critical reports. Higher education institutions like University of Houston, Eastern Washington University, University of Texas System, University of Chicago and hundreds of others, are turning to the powerful capabilities of supplier diversity management software, like B2Gnow, to support their diversity goals.  From diverse vendor search access to the largest certified supplier database in the world, to data enhancement tools that qualify and quantify current supplier data, to spend analysis capabilities that go deeper to understand diverse supplier data, to construction contract compliance that easily track and report supplier diversity on capital construction contracts, B2Gnow allows supplier diversity professionals to focus on meeting diversity goals, not chasing paper. Learn more about B2Gnow and request a demo. 

The Trouble with Supplier Diversity Data Today

High on the list of anxiety-producing issues for government officials is ensuring that disadvantaged subcontractors meet federal and local diversity mandates. No less important is the guarantee that subcontractors accurately reflect the diversity of the local community.

All too often, the data – which is critical to monitoring these programs – has fallen short of accuracy. As a result, government overseers and contractors are in a position where they are waiting for the other shoe to drop for what is certain to be negative fallout.

The sad fact is that data collection in this all-important area has failed to keep up with a more efficient world. In part, this is because accessibility of records and analysis has not progressed much further than the way it was in the mid to late 20th century.  Frequently, important data lies forgotten in boxes in a remote storage room because there is no master plan for inputting this valuable information into a program for analysis. The reasons cover the usual suspects: time, money, too few staff members and, occasionally, lack of commitment.

Such was the case in Denver’s Office of Economic Development, Small Business Opportunity. The agency faced a cumbersome manual process that included locating research papers stored in a warehouse. According to Director Tamela Lee, the city and county had been relying on an Access database that contained too much unorganized information.

“Information about payments and compliance just wasn’t readily available. At one point, I had to spend $15,000 to repair the system, only to have the IT people tell me I would have to keep spending money on a system that could never be fixed,” Lee said.

The size and scope of data may seem overwhelming to any government entity. No doubt there are millions of pieces of data that could be associated with any project, and manual collection of it is not the answer in today’s world.

First, there often are too few people on staff to manage the hand-collected material, again a budgetary issue. Second, the data is very hard to track. Furthermore, as the degree of difficulty increases, so does the likelihood of human error. In essence, this approach is nothing short of the old “paper chase” in which accurate analysis of the statistics on paper is jeopardized because of the reliance on manual entry and examination.

Only the most accurate and up-to-date data can ensure compliance with standards. Unfortunately, an old-fashioned spreadsheet is not the most effective tool. Until recently, this 1990s mechanism was all that was available, leaving the overseeing government agency to base its compliance objectives on what is clearly a less-than-suitable process. The agency’s affirmative action problems are likely to be compounded by a battle between two very strong and opposing forces pulling like a proverbial wish- bone: purchasing and diversity.

The Struggle of Purchasing Versus Diversity

Purchasing officers never will be thrilled by the costs of diversity compliance, particularly if it means paying for a disparity study that may cost more than $1 million. They certainly are aware of contract goals related to diversity. In the end, however, their job is to ensure that contracts meet all the legal and insurance requirements. With that narrow focus, purchasing officers may lack the familiarity with federal, state or local regulations that mandate diversity programs because, in their view, responsibility falls elsewhere.

The compliance officer, who may be unaware of some of the legal and insurance requirements associated with contracts, has a different view. They must ensure legally defensible data on which to base the diversity decisions and meet the contract goals. Usually, the only method they have to get the data is spending the money on a new disparity study or updating one that is several years old. The result is a standoff complicated by a series of speed bumps starting with ever-changing federal rules and regulations.

Another issue is the presence of pressure groups such as minorities, unions and community organizations fighting to establish their territorial imperative. Local and state political officeholders represent another external element and are not reticent about getting involved in these controversies.

All of these conflicting interests tend to widen the scope of the project without an increase in resources. It is a pressure cooker waiting to blow its lid for the government entity, the prime contractor and those for whom the guide- lines and contract goals were meant to help.

The Role of Disparity Studies

The key to controlling this potentially unworkable situation is accurate data, accurately managed. The foundation of the data tends to be the disparity study, assuming one has been conducted. Unfortunately, it may be outdated if it’s more than a few years old. Is it possible to gather legally defensible data without risking budgetary breakdown?

To answer, consider the rationale for a disparity study. In essence, the study is viewed as a method of measuring the amount of diversity participation with respect to the number of qualified minority-owned business enterprise (MBE) and disadvantaged business enterprise (DBE) firms to fill the position. Study data includes relevant statistics – particularly those related to female- and minority-owned businesses – an analysis of the economics of the community, history and appropriate legal information.

The disparity study recreates all data by looking at existing statistics on contracts and tracks important issues such as the amount of dollars that flowed down to MBEs, DBEs, etc. The data is analyzed by comparing dollars spent with the overall socioeconomic character of the area.

The disparity study becomes the baseline on which to build and save the organization a significant amount of data. It can determine whether discrimination exists, overtly or inadvertently, in the awarding of subcontracts. It then is up to the government entity to sort out the data in the delicate process of creating and auditing contract goals that accurately reflect a community’s diversity. It is the prime contractor’s responsibility to choose the right subcontractor based on the data.

This sounds simple, but the problem is far more complex because it is not enough to establish diversity goals through simple percentages. Remember legally defensible data? That is the assumption behind the disparity study, the rai- son d’etre for its huge cost and the willingness of government agencies to rely on its data.

However, the studies have not always lived up to expectations. The U.S. Commission on Civil Rights detailed this dilemma in its “Disparity Studies as Evidence of Discrimination,” a 100-page report issued in May 2006. Among its more than 30 findings:

These findings should not be read as a blanket indictment by the commission of disparity studies. They are important tools to ensure that federal, state and local diversity regulations are met and followed, but they aren’t necessarily the only option.

How does one ensure accuracy and timeliness that meet the needs of the most demanding compliance officer in lieu of an unavailable or outdated disparity study? Start with the database, recommends Denver’s Tamela Lee. Without it, she says, there practically is no chance to lower the costs for study and consultant.

Collecting Legally Defensible Data

The point of any accurate data is to create a level playing field for all business enterprises. Much of the data focuses on three elements:

This data, however, can be misleading – not necessarily through inaccuracy but because of less- than-thorough research. For example, figures may be available for the number of companies owned by Hispanic males, but do those statistics include the number and dollar amount of contracts awarded to those firms during a specific time period? What about the total number of female- or minority- owned HVAC companies within a specific radius of the project? Without asking the right questions, effective and timely measurement of project quality and goal satisfaction is nearly impossible.

Data models can provide information without having to redo disparity studies. This is not to suggest that studies aren’t needed. However, a good and thorough data collection can extend the time between studies and/or reduce the overall cost.

The best example of that occurred in Houston, where a 12-year-old disparity study was updated at reasonable cost because of a new and easily accessible Web-based database. Programming has been developed to improve data collection, such as money flow and lists of qualified vendors, as well as to update information such as certification records and to track contractor performance.

Finding a Better Way – Data Collection in the 21^st Century

Government agencies have cost-effective options for replacing old-style, ineffective data collection and reporting perfected for the collection of accurate, comprehensive and timely diversity data while significantly reducing staff workload. Easily accessible, ongoing data collection and processing enables the government agency to reduce the preparation cost of a disparity study, increase the time period between studies or perhaps avoid a costly study altogether.

Denver’s Lee recommends that the data system cover contract compliance, certification, contract information and payments. Most of all, the data “should be able to talk to each other,” she says.

Compliance officers always are looking for methods in which technology creates efficiency, allowing data collection to be quick, easy, accurate and cost-efficient. Denver and Houston found a technological answer, which cut their disparity study and database costs while keeping vital information timely, accurate and ongoing. Their experiences prove the phrases “government contract diversity goals” and “cost-effective data” used in the same sentence are not an oxymoron.

Like Denver and Houston, hundreds of government agencies are relying on the power of technology and systems like B2Gnow, the nation’s leading supplier diversity software. The 100% web-based system consists of twenty configurable and cost-effective modules that automate data-gathering, tracking, reporting, vendor management, and administrative processes. Moreover the core system deliverables include rapid report creation, data sharing across modules and systems, access to high quality data from 150+ certified directories, and more.

Get your Data in Order So You can Focus on Your Diversity Program
Let us take you on a tour of  B2Gnow Diversity Management Software – a robust, cost-effective solution that streamlines and automates data-gathering, tracking, reporting, vendor management, and administrative processes, resulting in a significant reduction in staff time and cost – allowing you to focus on meeting diversity goals, not struggling with data management. Learn more about B2Gnow and request a demo.