A Holistic DEIB Strategy Starts from the Inside Out
Diversity, equity, and inclusion (DEI) is now well established among business leaders as key to recruiting and retaining workers in today’s competitive environment. More organizations are embracing a holistic DEIB strategy. They recognize that DEI must shape the entire business rather than become another item on a checklist. Companies that take this approach are better positioned to retain both employees and customers. “67% of job seekers consider workplace diversity an important factor when considering employment opportunities. More than 50% of current employees want their workplace to do more to increase diversity.”
Progress in DEI also produces measurable business results. Those improved outcomes give companies even more reason to follow through on their values. As operational challenges increase and global competition grows, organizations that perform well in DEIB often lead in other areas, too.
- Research consistently shows that workplaces prioritizing DEI are more productive. Diverse companies generate 2.3 times higher cash flow per employee, and inclusive teams improve performance by up to 30%.
- McKinsey’s research shows that gender-diverse companies are 15% more likely to outperform their peers and ethnically-diverse companies are 35% more likely to do the same.
- [C]ompanies in the top quartile for gender diversity on executive teams were 25 percent more likely to have above-average profitability than companies in the fourth quartile.
- Companies where women hold more than 30% of executive positions are 48% more likely to outperform companies with less gender diversity.
- Companies with greater-than-average diversity had 19% more innovation revenues.
DEIB: The Next Evolution of DEI
Many organizations have expanded DEI into DEIB by adding belonging to the conversation. This broader definition recognizes another important element employees need to feel safe, valued, and supported at work. “DEIB recognizes the continual need to measure the humanity of a workplace, and diversity, equity, and inclusion are integral to that.”
Companies continue debating whether hybrid or fully remote work is more effective. They also keep experimenting with new ways to connect employees across locations and strengthen workplace culture. As McKinsey put it, “It’s not about the office, it’s about belonging.”
At its core, belonging explains the “why” behind diversity, equity, and inclusion. It recognizes that every employee brings unique needs, ambitions, and experiences. Deloitte describes three key contributors to belonging:
- Comfort: Individuals feel comfortable at work, including being treated fairly and respected by their colleagues and leaders.
- Connection: Individuals feel that they have meaningful relationships with coworkers and teams and are connected to the organization’s goals.
- Contribution: Individuals feel that they contribute to meaningful outcomes by understanding how their strengths help achieve common goals.
“Diversity matters in business because an employee population that comes from a variety of backgrounds brings different perspectives to all aspects of business. This translates into more creative, innovative, and often more effective solutions and products.” The authenticity of a company’s holistic DEIB strategy strongly influences these outcomes. Employees notice whether leadership genuinely supports DEIB both inside and outside the organization.
From the Inside Out: Diverse Supplier Programs
When a company claims to value DEI, employees and customers expect its policies, hiring practices, and partnerships to reflect those values. One area companies often overlook is their roster of third-party partners. Reviewing those relationships gives organizations another opportunity to demonstrate accountability and transparency.
The consequences of inauthentic values are clear. Employees don’t want to work for companies that fail to live up to their commitments, and customers don’t want to support them either. “According to Hootology’s Corporate Diversity Index, consumers who perceive a brand as being committed to DEI are three times more likely to consider their products or services, compared to those who do not. Supplier diversity is therefore a key part of businesses’ evolving recruitment and sourcing strategies.”
Internal programs and initiatives help companies advance a holistic DEIB strategy. Holding vendors to the same standards expands that impact even further. “While some organizations already do some vetting on the supply chain side, it’s time for businesses to look at all their vendor relationships to ensure they’re not complicit in supporting injustice within another organization.”
Like internal DEIB initiatives, supplier diversity programs only succeed when companies build them into everyday operations. “A diverse supplier is a business where individuals from traditionally underrepresented or underserved groups own and operate at least 51% of the company. Common classifications are small-business enterprises (SBEs), minority-owned enterprises (MBEs), and woman-owned enterprises (WBEs).”
Measuring Progress and Accountability
Once a supplier diversity program is established, companies need clear goals and performance indicators. Those metrics help companies monitor progress. They also encourage accountability and give employees and customers greater transparency. Similar to internal DEIB efforts, many leaders still look for ways to fully integrate these priorities into daily operations.
“CEO engagement with supplier diversity programs is at an all-time high, but only 38% of companies include supplier diversity metrics in management’s performance objectives.”
Despite making supplier diversity a priority, many organizations still struggle to move beyond planning. “Seventy percent of respondents globally said supplier diversity is a high or medium priority for their organization, yet many are still in their early stages of implementation. Sixty-three percent haven’t started, or are just getting started, with these initiatives.”
Companies that define concrete goals and measure progress are twice as likely to succeed. Tracking those results also creates valuable data that supports transparency with employees and customers. It also strengthens accountability. DEIB becomes part of everyday decision-making instead of remaining a public statement.
“Accountability is going to become more and more important as people are starting to look for employers. They’re going to want to see those metrics and make sure that they’re joining an organization that’s really putting their money where their mouth is,” says Ted Kopta, VP of Marketing at ADP.
Far-Reaching Impact
Taking a holistic DEIB strategy into supplier and vendor procurement strengthens both the bottom line and brand identity. Just as internal DEIB initiatives improve innovation and productivity across the workforce, diverse supplier programs deliver similar benefits beyond an organization’s walls.
“Minority- and women-owned business enterprises have shown that they can have a positive impact on the economy. They offer their corporate partners year-over-year cost savings of 8.5%, considerably more than the 3% to 7% annual procurement savings that most organizations realize.”
The benefits don’t stop there. More industries now evaluate partnerships through the same DEIB lens they apply internally. Telecommunications, healthcare, and pharmaceutical companies, in particular, source more from diverse businesses than many other industries. Many have also developed the infrastructure and processes needed to make supplier diversity a lasting part of their procurement strategies.
Major corporations like Verizon publicly share their commitments to diverse suppliers, making candidates, customers, and partners aware of a new standard for corporate values:
“We are committed to mentoring, promoting and engaging with diverse businesses in our supply chain, and believe that diverse businesses create the greatest economic impact in our communities, as well as offer innovative, high-quality and cost-effective solutions for Verizon to better serve our customers.”
Building a Lasting Legacy
The influence of a holistic DEIB strategy extends well beyond the business community. Corporations have an opportunity to build a different kind of legacy, one that leaves a meaningful mark on both the economy and society.
“Inclusive procurement also delivers broader societal benefits by generating economic opportunity for disadvantaged communities.”
Every purchasing decision has the potential to create a ripple effect. Supporting diverse suppliers helps strengthen local businesses, create jobs, and invest in communities that have historically faced barriers to opportunity.
In a conversation with the US Chamber of Commerce, Victoria Yeager, Head of Global Procurement Customer Excellence at Genentech, explained the broader impact:
“If we can support … one diverse supplier, they are going to be reinvesting in their community. That brings tax dollars [and] … jobs in. So one business decision that we can make can have … a positive impact that stretches way beyond just our business.”
A holistic DEIB strategy isn’t limited to hiring practices or internal initiatives. It shapes how organizations choose partners, invest in communities, and demonstrate their values through action. As employees, customers, and stakeholders continue to expect greater transparency and accountability, businesses that embed DEIB into every aspect of their operations will be better positioned to build trust, strengthen performance, and create lasting impact.
