1) Can you outline why your team embarked on this project and the problem that needed to be solved?
BlueCross BlueShield of Tennessee, Inc. (BlueCross or BCBST) is a mature diversity and inclusion company. Guided by our leadership team and board of directors, diversity and inclusion have been a focus for more than 20 years.
We value and respect all people for who they are. This commitment supports our employees as they deliver on our mission to provide peace of mind through better health to our members. It also gives us a competitive advantage when our workforce reflects the individuals we serve.
This commitment extends enterprise wide. For example, when our suppliers understand our members’ needs, they often bring solutions that enhance member and business experience. In that way, BlueCross continues to establish inclusive and ongoing relationships with diverse suppliers such as small, minority, women, Lesbian/Gay/Bisexual & Transgender (LGBT), veteran, service- disabled veteran-owned, and Historically Underutilized Business Zone (HUB Zone) businesses, as well as many others. As a result, we find success with a well-rounded portfolio of suppliers that also enhances economic development for our state.
2) How were things done originally and what was the inspiration to innovate the process?
BlueCross established a defined Supplier Diversity program in 2012. While the company had diverse suppliers in its portfolio already, the program sought to better centralize sourcing and better support the opportunity for classification when contracting.
We knew that if we innovated in this way, BlueCross could become more effective and efficient while increasing sourcing opportunity for all.
3) What KPIs did you use to measure success for this project? (For example: performance, customer satisfaction, revenue, sales or relevant financial gains?)
We have implemented and integrated a measurable supplier diversity process into all procurement activities through all BlueCross corporate lines of business. This process provides maximum opportunities for all businesses to participate in sourcing activities and supports our commitment to invest in the communities we serve.
Our procurement team implemented a monthly reporting process that measures our reportable spend along with the percentage of RFP respondents that are from diverse vendors. This process involves intentional collaboration between teams in finance, procurement, and audit, as well as our executive leadership team.
4) How do you plan to ensure that the new model remains relevant and adapts to the future needs of the market?
Along with having measurable spend results, we also decided that we need to build a strong pipeline of smaller suppliers that could eventually become our partners. We have put in place an “RFP Think Tank” process in which we conduct mock RFPs with small and diverse businesses. This allows us to build relationships and break down perceived barriers to doing business with a large company like ours. Feedback on this program has been very positive, and we continue to expand this effort.
5) What advice do you have for those who may want to implement this innovative approach in their own organizations?
Perhaps most important is having senior leadership direct the business case through the enterprise. Don’t hesitate to change old habits into new opportunities. Give yourself and your organization time to build new relationships both internally and externally, and to adapt to new ways of working. Innovation doesn’t happen overnight.
6) What factors do you think are the most important to consider when innovating in this category?
By building up a sustainable long-term and diverse supplier portfolio, you not only have a stable supply base but also allow diverse partners to invest in innovations to improve their products/services.