We can all agree that keeping a group of suppliers engaged and motivated to work our openings in today’s fight for candidates should be a contingent workforce program manager’s No. 1 goal. We can also agree that there isn’t a mysterious pool of talent hidden somewhere that a particular supplier has the keys to finding.
So how do we sort through all of the suppliers we already have, entice them to focus on us and fill orders quickly so the red emergency phone from our hiring managers stops ringing? That, in a nutshell, is the underlying goal of effective supplier management.
The solution? Separate your existing supplier pool into buckets. Say you have 100 suppliers. If you can identify their traits most meaningful to your program, you are on your way to optimizing your supplier pool. Here’s how to approach the task.
Skill buckets. Which of your suppliers provide specific types of talent? Some suppliers will tell you they can “do it all,” but what do they do best? Look at each of your suppliers individually and if you have to call them to ask, make it a priority to do so. Or you can run your own reports and see for yourself which type of talent they place most often. If you can identify 10 firms that are great at filling IT roles, seven that are good at finance/accounting, and 15 that excel at administrative/clerical placements, then start here to create a nice “bucket” of experts.
You may receive push-back from some suppliers as you place them in their bucket, but the benefit for them is you are also reducing their competition in that area. You are, in essence, grouping together experts and removing the noise. This will help your suppliers feel engaged as they are no longer one of 100, they are now one of 10, which means more business for them and more focus for you.
Location buckets. Where are your roles located? A supplier with operations in San Francisco knows the area, can give good directions, and understands traffic and whether someone would be willing to commute to the office. Obviously, given the world of remote work the pandemic has enabled, this is not necessarily the magic potion, but it goes a long way when you think about which suppliers have a network of locals and an understanding of your market.
Backup bucket. You’ll need all hands on deck when it’s peak season, so it’s a good idea to have a group of suppliers willing to pitch in. Who knows, the backups might be so eager to win your business that they outperform your “regulars.” And when that happens, you can add a few new suppliers to your buckets and keep the lists fresh. This backup theory does come with a caveat though: The backups will eventually lose interest if they sit there too long without the opportunity to prove themselves, so remember them and reach out often so you don’t turn around one day to find your bench is empty.
Niche bucket. Niche suppliers are a must when you look at your supplier pool. These are suppliers that are so specialized they support a limited amount of positions — think marketing/creative, legal, janitorial, office supplies or lawn services. Identify providers in each of these areas and keep the list very narrow. There isn’t a lot of business coming their way, so having a lower number of suppliers is critical to keeping them engaged. And if we are being honest, you will want specialists working on special roles (attorneys) or fewer office supply providers so you receive bulk buy discounts.
Diversity bucket. As a leader in supplier management, you must consider your diverse partners from ALL categories. If you don’t have a well-rounded bucket of diverse players then you have done yourself and your organization a disservice. So, having looked at your full list of 100 suppliers, do they all look the same? Make sure each of your buckets includes a diverse provider.
Diversity doesn’t only focus on supplier ownership. Diverse programs should also include a diverse candidate pool. So, ask your all of your providers what programs they have. If a non-diverse-owned supplier has a fantastic program for placing veterans, provides second-chance hiring or works to bridge the opportunity gap with historically excluded communities, then by all means, include them in your diversity bucket.
And I would strongly encourage you to give your diverse suppliers a “hand up” along the way to ensure they are successful. Having a diversity bucket doesn’t do much good for you or them if there isn’t a plan to help them make an impact. So spend extra time with your diverse partners, consider providing them a head start on an order or perhaps develop a mentorship program.
Remove bucket. Once you have finished organizing the above buckets, what happens with the suppliers who didn’t make any of them? I suggest you review them closely. You may find a place to put some of them where it doesn’t skew all the work you’ve done to identify your experts. But you may decide that there are some suppliers who are no longer a match. Perhaps the supplier has no headcount or the manager who demanded you add them in is no longer in the organization and now it’s costing you more to manage the supplier than you want to bear. So it’s time to rationalize, or “optimize,” your list further by removing them. It’s a tough call, but you can feel confident you have reviewed your list thoroughly and identified those you need and don’t have room for the rest.
And that’s it. You’ve freshened up your lists, identified your experts and removed the weight of managing more than you need. Back your decisions with data through reporting, then continue measuring performance so your buckets don’t overflow in the future.