"We are just getting started": McKinsey doubles spend with diverse suppliers
April 5, 2023 | In 2020, McKinsey announced 10 actions toward racial equity. This set of new commitments "builds on our work to create better outcomes around racial justice and equity, and gives every firm member the opportunity to be tangibly involved," says Sara Prince, McKinsey senior partner and leader of the 10 actions.
Action 7 articulated a bold goal focused on supplier diversity: to double our spending with diverse suppliers within three years, a goal we have now surpassed.
"The firm has a deep and longstanding commitment to helping advance diversity, equity, and inclusion in business, in society, and within our firm," says Scott Parris, chief procurement officer and McKinsey partner. "We are proud to have demonstrated that commitment, and we are just getting started. We will continue working to make it even easier for colleagues to find and choose diverse suppliers."
The benefits of supplier diversity flow in both directions. Increased spending with diverse suppliers leads to greater representation, employment, and economic advancement for diverse and small business communities. For McKinsey, new suppliers promote innovation through new products, services, and solutions, driving healthy competition with existing vendors.
There is a robust philosophy behind our supplier diversity program, says Eyvon Austin, supplier diversity manager. "We're ensuring our commitments to supplier diversity are firmwide, integrating elements such as clear baseline spending goals across teams, supporting business development of diverse suppliers, and increasing our engagement with nonprofits that bring together diverse suppliers."
To achieve our objectives, two strategies in particular have proven instrumental: Connecting with and crafting opportunities for new diverse suppliers while continuing to nurture and grow our relationships with existing diverse suppliers.
"We felt comfortable because when you look at McKinsey's history, their fingerprints are on things a lot deeper than supplier diversity. They've been providing high levels of social impact for a long time."
Brian Sharpless, director of diversity business development at World Wide Technology
Building new connections
Diverse suppliers can face hurdles when competing for new business. While they often offer incredible service and value, diverse suppliers may not have the benefit of legacy business, contacts, access to capital, or other advantages that many competitors may have.
In 2020, McKinsey worked to accelerate its approach to supplier diversity, with a focus on making it easier to find talented, diverse suppliers that we knew existed across our major spend categories.