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Maximizing Diversity At BITAC Supplier Diversity, industry experts spoke frankly on the state of these programs in the hotel business. Monday, June 07, 2010 Glenn Haussman

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Supplier Diversity programs are at the forefront of many leading hotel companies’ initiatives and are quickly becoming an industry mainstay. In fact, many of today’s leading lodging companies are investing in diversity programs not just because it’s the right thing to do, but because companies falling under the Diversity banner are delivering real solutions to industry buyers at the right time and at the right price.

More important, these programs are not kowtowing to political correctness. In fact, hotel companies are finding themselves relying ever more on these typically smaller firms to fill gaps created by larger organizations that were overextended and succumbed to the effects of the Great Recession. Diversity classified companies are proving to be smarter and more resilient than many expected.

That was the general consensus amongst expert panelists at a discussion held this morning at the Buyer Interactive Trade Alliance and Conference (BITAC) Supplier Diversity event.  The event is being held this week at the gorgeous Aria Las Vegas, the premier resort at the CityCenter complex in Las Vegas.

“We are doing my better much better with Diversity programs,” said Matt Thursom, Manager of Supplier  Diversity with Walt Disney World. “In times like this we have to be more creative in how we spend our dollars. Diversity suppliers are coming through for us,” said Thursom.

Kenyatta Lewis, Director of Supplier Diversity with MGM Mirage agreed. “Diversity companies have the flexibility to meet our needs and our customers’ needs. There have been multiple instances where larger companies have folded, and diversity suppliers have stepped up to the plate with the solutions we needed,” said Lewis.

Even though Diversity programs are registering more triumphs than ever before, those most closely associated with them feel there is room for improvement. Not because programs aren’t working well today, but because it’s critical to keep a watchful lookout for how to get more companies involved under this umbrella.

“We work a lot one-on-one with suppliers and we help them find their niche. These companies cannot jump in and do all of Hyatt’s Hotels,” said Anne Hanch, Vice President of Purchasing with Hyatt Hotels Corporation. “Suppliers have to find their strongest markets and work their way up and develop relationships.”

At BITAC events, everyone is encouraged to get in on the discussion, so the events include a real time polling mechanism to engage audience members. And when asked if their current form, do diversity programs help, 45 percent said yes while an additional 43 percent agreed they help but could be improved to be even more effective.

According to Fred Lona, Senior Director of Supplier Diversity with Hilton Worldwide, suppliers need to take the reins and form multiple relationships for hotel companies they are pursuing for business.

“Suppliers don’t always understand the changes a corporation is going through. It’s a case of survival of the fittest and organizations are contracting and people are being moved around. Then all of a sudden your contact is gone,” said Lona.

“Our business is changing and evolving and supplier diversity needs to evolve as well,” said Lewis, who said MGM Mirage uses a variety of metrics to ensure the programs are working most effectively. 

According to BITAC attendees, the best way to measure the effectiveness of a supplier diversity program is: Analysis of the diverse spend reported by a corporation (35 percent), review their community outreach programs (8.5 percent), diverse supplier accessibility to buyers  (23 percent) and support and development programs available for diverse suppliers (34 percent)

“Procurement is like real estate which location, location, location. Procurement is timing, timing, timing. You also have to build trust that they can fulfill orders, and make sure they have the right product at the right time and at the right cost,” said Hilton’s Lona.

Finally, when asked in five years time what percent of lodging companies will be using diversity programs 29 percent of attendees said 25 percent of hotel companies would be while 27 percent said 50 percent of hotel companies would have a program in place. An incredible 39 percent responded with 80 percent or more of hotel companies would have a program up and running within five years.