Supplier Diversity rsity:
OPINION 19
Supplier Diversity rsity:
It
is perhaps a coincidence that many of the companies cited as exemplars of good practice in SD are in the financial services sector. For instance, financial companies registered on the numerous corporate SD programmes in the UK( Business in the Community, European Supplier Diversity Programme and MSDUK, for instance) include Bank of America, Citigroup, Credit Suisse, Deutsche Bank, Goldman Sachs, Lehman Brothers, Merrill Lynch, and Morgan Stanley. And many of these companies are facing record losses because of the current problem- Citigroup made a $ 9.8 bn(£ 5bn) net loss for the last three months of 2007 and Merrill Lynch made a net loss of $ 7.8bn(£ 3.9bn) in 2007, for example. Moreover, many of these companies seeking to build a business case for diversity appear to be at a particular risk because of the exposure to global market conditions linked to capital flows.
As the global economy- and the business community in particular- comes to terms with the growing uncertainties brought about by the current financial and credit crisis, it is useful to consider whether this may impact upon the supplier diversity( SD) agenda.
Dr Kemal Ahson
Typically, some organisations deal with credit crises through making redundancies. Not surprisingly, many of the above mentioned companies have recently announced redundancies in either the UK or world-wide – Bank of America( 3,000), Citigroup( 1,000), Credit Suisse( 500), Deutsche Bank( 300), Lehman Brothers( 1,200), and Morgan Stanley( 6,000), to name a few. And then there are the SD advocates in the non-financial service sector – Cadbury Schweppes, Ford, and IBM all have made job cuts and / or shut factories in the UK last year, for instance.
Leaving aside the accuracy of these figures it is important to recognise that the current global economic and credit crises may not necessarily impact negatively on SD – the link between sacking a derivatives trader and not using a
local BME food supplier is not clear. In fact, it could be argued that the flexible and innovative nature of a diverse supply chain may actually provide( or at least contribute to) a solution to the current economic crisis.
Dr Kemal Ahson
ISSUE SIX 2008 engage | uk