3 Learning Lessons from North Carolina's Successful Supplier Diversity Program

Tammie Hall and her team in North Carolina are a shining example of when good policy meets proper execution, but her success did not happen by accident. Making North Carolina’s historically underutilized businesses (HUB) department one of the best in the country required a consistent drive and vision focused on change and improvement. 
What have Tammie and her team accomplished so far in North Carolina? Take a look at the numbers:  
  • 20% of construction opportunities are awarded to minority and women-owned business annually (exceeding their goal of 10%).  
  • Launched the first-ever grant program for small businesses in state government, providing $13.5 million to small businesses impacted by COVID-19 
  • Executed the largest disparity study in the country, which included reviewing more than 10 million purchasing records.  
We had the opportunity to sit down with Tammie to discuss North Carolina’s HUB program and what has made it such a long-term success for the state. Listen to the full interview here. Among many other insights shared, below are three major takeaways for other jurisdictions looking to improve their own supplier diversity efforts: 

1. Successful supplier diversity programs require dedicated time and resources 

Most jurisdictions would agree that supplier diversity and inclusion is important. Many even take some initial steps to improve, such as reviewing bid solicitations or conducting a disparity study. Taking steps within your purchasing team can certainly drive short-term wins – a well-intentioned push to invite more HUBs to participate in bids, with perhaps a few going on to win the award that otherwise may not have.  
Large-scale change, however, requires dedicated and intentional efforts. To expect an already-swamped purchasing department to implement these changes on their own is unrealistic. And often, competes against their interests to support agencies as efficiently as possible.  
“Nothing worth having comes easy,” Tammie acknowledges. “The process requires you to be intentional. To constantly track and know where you stand and make adjustments when necessary.” 
That’s why North Carolina created the HUB Office back in 1999 – a department dedicated to increasing the amount of goods and services acquired by state agencies from historically underutilized businesses. By creating a department dedicated to the interests of HUBs, the office is better positioned to guide, regulate, measure, and improve spending throughout the state.    
And with HUB as their guide and resource, the purchasing department can focus on what they do best: managing the solicitation process and upholding ethical public spending.  

2. Create inclusion checkpoints at every stage of your buying lifecycle 

With their team assembled, HUB works to identify and eradicate any opportunities for inequity in the state spending process. And they are attaching each part of the buying lifecycle head on.  
Here are just a few ways Tammie and her HUB colleagues systematically approach their supplier diversity and inclusion programs: 
  • Regularly reviewing solicitations to remove language that may inadvertently exclude HUBs.   
  • Communicating regularly with HUBs in the community so they understand the state wants to work with them and how they can begin participating. 
  • Registering and certifying HUBs to make it easier to benchmark the state’s progress. Maintaining a clean database is key to being able to move quickly when needed. 
  • Creation of a Small Business Reserve program, which identifies bids at a certain spend level where small businesses can compete against each other to increase the likelihood of a HUB receiving the award.  
  • Compliance checkpoints at the end of every contract, one example being that a minority or women-owned business cannot be released from a contract without notifying HUB first.  

3. Regular data studies are critical to helping you reach your inclusion goals 

When you are full steam ahead evaluating and improving your processes, stopping for data benchmarking and cleaning can feel like a poor use of precious time. While it can be tempting to skip the measurement, Tammie reminded us of the importance of having these critical benchmarks.  
“You’re not supposed to run race-based programs forever,” she says. “You’re supposed to, at some point in time, remedy the practices, laying an even playing field for all business owners to participate in the supply chain.” 
Regular disparity studies are essential for marking your jurisdiction’s progress and identifying where there is still work to be done. They present a clear picture of what the marketplace actually looks like in your jurisdiction, and how closely your spending aligns with that breakdown. They help you create impactful goals.  
North Carolina’s 2010 disparity study helped them set their inclusion goals for the next decade, including the 10% construction spend with HUBs that has been since surpassed. In January 2021, they wrapped up a year-long disparity study to continue to mark their progress. From this study came 12 recommendations for improvement that will guide the next wave of their efforts.  

Creating a more equitable purchasing process, and community, together 

By bringing the right voices to the table, investing in a dedicated department, and working together, the HUB Office has been able to create impactful and measurable change in North Carolina’s purchasing process. We look forward to following how the state continues to improve their processes to promote supplier equity.  
If you want to hear more of Tammie’s interview, listen to her episode on Decisions That Matter, Creating a Thriving HUB Program with North Carolina’s Tammie Hall. And if your jurisdiction has a diversity and inclusion story to tell, we’d love to hear it! Email bernadette@procurated.com. 
  Bernadette Launi

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