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Maximizing the Benefits of B2B Supplier Diversification
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Maximizing the Benefits of B2B Supplier Diversification

Supplier diversity initiatives are a savvy business move as well as an investment in social responsibility.

Simha Mummalaneni and Jonathan Z. Zhang
MIT Sloan Management Review, 2020
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Editorial Rating

8

Qualities

  • Comprehensive
  • Analytical
  • Applicable

Recommendation

Large companies from a variety of sectors have initiated programs that support diversity and inclusion among their suppliers. As Simha Mummalaneni and Jonathan Z. Zhang write in Sloan Management Review, this promotes small supply companies owned or run by members of otherwise marginalized groups, including women, ethnic minorities and the LGBTQ community. Small businesses that reflect society’s diversity are crucial to overall economic stability; their success benefits everyone. This article makes a strong case for the value and viability of supporting diversity all the way through the supply chain. 

Take-Aways

  • Diversity initiatives for suppliers help companies owned or run by members of marginalized groups obtain contracts.
  • Some companies worry that supplier diversity programs are financially inefficient.
  • Supplier diversity programs benefit the small businesses that sell goods and services and the larger companies that purchase from them.

About the Authors

Simha Mummalaneni is assistant professor of marketing at the University of Washington’s Foster School of Business. Jonathan Z. Zhang is assistant professor of marketing at Colorado State University’s College of Business.

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