Telus has established a supplier diversity program and plans to mentor diverse suppliers
By most measures, Canada scores high on the diversity scale. According to Statistics Canada, our visible minority population rose by 27.2 percent between 2001 and 2006. Also according to the national statistics agency, visible minority groups could account for one third of the Canadian population by 2031.
The benefits and challenges of representing those minority groups in the workforce have been well known. While many organizations have established diversity programs covering the make up of their own staff, perhaps less well documented are efforts to diversify the supplier base.
One company making strides towards supplier diversity is Telus, a telecommunications giant offering a wide range of products and services, including Internet access, voice, entertainment, healthcare, video and satellite television. The company recently began a supplier diversity program. Telus already had plenty of diversity among its employees and wanted to spread that to its suppliers, says Eric Fergin, Telus’s vice-president of procurement.
The company had connections with organizations like WeConnect and the Canadian Aboriginal & Minority Supplier Council (CAMSC), of which it was already a member. Telus wanted to do whatever it could to encourage diverse suppliers to bid on its business, Fergin notes. When the organization joined CAMSC and WeConnect, they looked at the supplier lists from those organizations and realized the companies were typically small-to-medium sized enterprises offering services in the shared services, marketing, IT and staffing areas. From there, various directors at Telus worked to design a road map for what the company was procuring, then matched those needs against the capabilities available on the supplier lists.
The organization came up with a list of diverse organizations they were interested in inviting to sourcing events, Fergin says. In total, the company targeted several diverse suppliers to invite to procurement events. Among those, Telus awarded business to four companies that were identified as diverse. Indy Sian, the company’s director of business enablement—procurement and supply chain management—and member of WeConnect’s board—spearheaded the initiative.
Telus tracked which suppliers they reached out to, Fergin notes, along with which suppliers were awarded work. “In a few cases they won, in a lot of cases they didn’t,” Fergin says. “But at least it was an experience for them to participate in a formal procurement process.”
Something they noticed during the process was the lack of ability among several diverse suppliers to write quality proposals oriented towards large enterprises, Fergin says. Often, although not always, diverse companies are smaller organizations that can lack the experience needed to write proper formal proposals. Instead, those companies often have experience winning business through relationship management or by submitting unsolicited proposals, Fergin notes.
Telus uses a structured RFP with a series of questions and pricing templates, Fergin says, so companies may have trouble telling their stories in a way that fits the format and adequately responds to questions. In those cases companies likely lack the necessary staff, such as experienced proposal writers, who can abide by the organization’s format without diluting the story the company is trying to tell about itself.
Telus had already been through its own journey of improving the quality of their own proposal writing to their customers, says Fergin, so the enterprise was able to help diverse suppliers polish their written submissions.
“We really need to put our arm around the shoulder of some of the small companies and say, this is how you win business at a company like us,” Fergin says. “A lot of these companies don’t know how to get good at writing proposals. How do I sound like I have a polished story? How do I make sure I credibly answer all the questions?”
While Telus can introduce diverse organizations to larger companies, Fergin notes, many smaller companies would benefit from advice on how to react to formally tendered business. In many larger organizations, a committee or panel of stakeholders has a say in purchasing decisions, so speaking to the needs of those stakeholders in a proposal goes a long way. But for many smaller and diverse companies Telus met with, a common bottleneck was forging a proposal that passed muster.
“You’ll be evaluated first by what you can put in writing,” Fergin says. “You may have the capabilities to deliver a bang-up quality product or service, but if you can’t articulate that properly in writing to at least get that committee to want to give you a second look, that’s not going to get you where you need to go.”
One company that won business with Telus was Atlanta-based technology consulting firm RTX Technology Partners. Hans Delly, the company’s managing director, spoke during a panel discussion at the CAMSC Diversity Procurement Fair on April 9 that also featured Fergin. The first step in landing business with Telus—a Canadian company—was to join CAMSC, Delly told the audience during the panel discussion. They introduced themselves to procurement teams north of the border and started a dialogue with Telus. It took about six months of conversations to establish a relationship with the contact they wanted to connect with. “We took the initiative,” Delly said.
RTX Technology Partners became familiar with Telus’s clients and business, he said. At the same time, they also started talking to Telus about data migration strategies and some of the challenges Telus faced in certain areas. After about six months of establishing connections, Telus contacted the company about a challenge requiring RTX Technology’s help. Ultimately, Delly said, RTX Technology won the bid.
While working with small and diverse suppliers poses challenges, it also offers advantages, Fergin says. Conventional wisdom notes that large companies do business primarily with other large companies. But to their advantage, smaller organizations often have less overhead and can adapt if needed. Diverse or small suppliers may have offerings tailored to a specific geographical location, or they might be able to provide a niche product or service both competently and cost effectively. Sometimes, a large company trying to serve a broad spectrum of customers can’t do that, Fergin says.
Also, large suppliers can have processes that, since they’re trying to create economies of scope, can’t deliver unique services for each customer, Fergin notes. Customers must
therefore adopt the supplier’s processes. A diverse supplier, because they’re often smaller, can adapt more readily to the processes of a large customer like Telus.
“That makes you (the supplier) more attractive to us,” he says. “Because you’re more adaptable, you can do it at a lower cost and service the needs of a large enterprise more efficiently in some cases.”
Telus also recently sent letters to some of their own suppliers encouraging them to join organizations such as CAMSC and WeConnect as corporate members. Telus, already a member of both organizations, meets with CAMSC and WeConnect suppliers to better understand their business and see whether it’s a match with their own procurement road map, Fergin says.
This year, Telus plans to begin a mentoring program for diverse suppliers also spearheaded by Indy Sian, Fergin says. The program, which Fergin says is the next step in the company’s supplier diversity journey, could include workshops or seminars instructing them how to do large enterprise proposals. Mentoring allows Telus to expand its diverse supplier base without the need to set quotas—something the company isn’t interested in, he says.
“We almost have to act like consultants and advisors to some of the diverse companies to help them get to the next stage,” Fergin says. “That’s the leg up we want to give them.”
Suppliers who attended CAMSC’s Diversity Procurement Fair were able to hear about Telus’s mentoring plans during the panel discussion Fergin participated in. Several of them approached Fergin afterwards for more information. “I don’t think we’re going to have any difficulty in getting diverse suppliers to be part of it.”