For nearly as long as it has existed, the United States has been characterized by economic inequality. Between our country’s richest and its poorest lies a seemingly unbridgeable chasm, yawning ever wider with each passing year. Rather than contributing to the cycle, SourceMark is seeking to be a part of the solution. Partnering with a diverse supplier like SourceMark is a powerful strategy to address socio-economic inequality at its roots and foster stronger, more stable communities for all.
Understanding Socio-Economic Inequality
Socio-economic inequality is the extent to which income is evenly distributed within a population. Though income inequality persists worldwide, Pew Research finds that of the world’s most advanced economies, it remains the highest in the United States. It is so pronounced in fact, that in 2019, the wealthiest 1% of households averaged more than 84 times as much income as the bottom 20%. The impact this has on communities is undeniable, trapping generations of families in the cycle of poverty and even adversely affecting life expectancy and access to basic needs like healthcare, education, water, and sanitation.
The Power of Diversity in Supplier Partnerships
Supplier diversity is present when an organization’s contracts for goods and services feature businesses that are at least 51% woman or minority-owned. But supplier diversity doesn’t just sound good on paper—it delivers results. Here are just a few:
- Improved costs for higher-quality products – when healthcare orgs widen their pool of potential suppliers, they help promote healthy competition, resulting in reduced prices and standout products as suppliers vie for business
- Enhanced innovation and creativity – as orgs make space for every voice to be heard, they foster an environment where creativity can be explored unhindered, allowing today’s promising ideas to flourish into tomorrow’s medical breakthroughs
- Increased efficiency – diversity in supplier partnerships creates agile, responsive, and resilient supply chains, ensuring patients continue to receive much-needed care even in times of economic uncertainty
Socio-Economic Impact of Partnering with Diverse Suppliers
When you partner with a diverse supplier, you’re doing your part to bring about a more equal society for all. Victoria Yeager, Head of Global Procurement Customer Excellence at Genentech, Inc., describes supporting diverse suppliers as a ripple effect. If we support one diverse supplier, Yeager explains, we enable them to reinvest in their community, bringing in more tax dollars and helping create new job opportunities for marginalized communities. When larger companies use their platform and capital to uplift diverse entrepreneurs with less resources, they contribute to the economic empowerment of marginalized communities. In this way, Yeager explains, one small business decision can have an enormous socio-economic impact.
Kaiser Permanente is another healthcare organization dedicated to equality, diversity, and inclusion. To further strengthen local communities and empower underrepresented groups, Kaiser Permanente recommends:
- Supporting vendors with sustainable products and practices to reduce climate impact
- Seeking out contracts with women-owned or minority-owned vendors to address gender, racial, and economic inequity
- Using local vendors to reinvest in communities
- Providing mentorship and resources for business growth by supporting community wealth-building or fostering employee-owned enterprises
Long-Term Social Significance
Aside from short-term economic benefits, investment in disadvantaged areas can positively impact outcomes long-term, for both you and the communities you choose to support. Diversity in supplier partnerships builds resilient local economies more equipped to weather economic uncertainty, mitigate socio-economic disparities over time, and provide high-quality products and services for the long haul.
Just as critically, visibly and proudly investing in underrepresented groups can inspire other organizations to embrace diversity and inclusion—and all the economic growth that comes with it. Reaching out to these groups, creating mentorship programs, and communicating with other associations about the work you do can all contribute to a culture of fairness and equality.
Overcoming Challenges and Implementing Change
To make the most impact, it’s important to identify and address barriers to diversity in supplier partnerships. For example, Bank of America VP of Global Supplier Diversity Vonshe Jenkins explains to Mckinsey & Company how their rigorous security requirements posed time and resource challenges for diverse businesses. To correct this, Bank of America intervened early in the vendor-onboarding process, ensuring that diverse suppliers were at the same level of preparedness as their peers and could compete fairly in the market. You can ensure the same by providing support and resources for diverse suppliers. Other strategies include sharing best practices and success stories to inspire other organizations to take similar action, and forming multilateral partnerships between businesses, governments, and local communities to empower community development in underserved areas and economic growth for all.
As we move forward into a more socially conscious future, partnering with diverse suppliers is critical in reducing socio-economic inequality and bringing about the long-term economic growth needed to build stronger, more stable communities. SourceMark is one of the healthcare industry’s largest certified Minority Business Enterprises (MBEs), and as such is uniquely positioned to facilitate collaboration, collective action, and sustainable development in underrepresented communities. The economic impact of this kind of supplier diversity is hard to deny: a renewed sense of innovation, a responsive supply chain, higher-quality products, and improved costs. When we invest in our own communities, we reap what we sow, meaning economic empowerment, growth, and positive change for every organization involved, big or small.
We can help you deliver positive patient experiences and better clinical outcomes. Get in touch with us for more information.