Monday, August 21, 2006
Research Shows Supplier Diversity Good for the Bottom Line
The following are excerpts from www.thehackettgroup.com report of results on supplier diversity programs that was also reported in the Wall Street Journal on August 2. Increasing the reliance on women- and minority-owned businesses as suppliers does not cost leading procurement organizations more, according to new research from The Hackett Group, a strategic advisory firm and an Answerthink company (NASDAQ: ANSR). In fact, some cutting-edge companies find quite the opposite is true, and are finding ways to use supplier diversity to drive new sources of revenue. Hackett's research shows that world-class procurement organizations which focus heavily on supplier diversity don't sacrifice procurement savings to do so. In addition, these leading procurement organizations have slightly higher adoption rates of supplier diversity programs as typical companies, yet are able to generate 133%percent greater return on the cost of procurement operations than average performers, driving an additional $3.6 million to their company's bottom line for every $1 million in procurement operations costs.