By BETSY TAYLOR
Timothy Martin
Timothy Martin, who has procured goods and services for CHRISTUS Health for 12 years, took on a newly created role about a year ago for the Irving, Texas-based health care system: manager of supplier diversity, contracting and resource utilization. To advance CHRISTUS Health's commitment to supplier diversity, Martin actively reaches out to minority-, women- and veteran-led companies and others, helping them understand the blueprint for doing business with CHRISTUS Health.
According to a 2015 report "Increasing Supplier Diversity in Health Care" by the American Hospital Association/Health Research & Educational Trust, supplier diversity exists when an organization's contracts for goods and services feature "a variety of businesses," including businesses that are "at least 51 percent owned, managed and operated by minorities, women or veterans"; those located in a "historically underutilized business zone"; or those that are "small, disadvantaged businesses," as defined by the U.S. Small Business Administration. Martin said CHRISTUS Health subscribes to this definition in its efforts to increase supplier diversity. He spoke with Catholic Health World about why supplier diversity is important and how CHRISTUS Health follows through on its commitment to diversify its vendors.
Why does CHRISTUS Health encourage supplier diversity?
It is the right thing to do for the people and communities we serve. It builds healthy competitiveness in regions and in industries. It is beneficial to all key stakeholders, not just to the companies with supplier diversity programs. It adds economic value because it encourages growth of diverse businesses that typically face barriers that challenge their start-up ability and long-term sustainability.
How does CHRISTUS Health measure success in supplier diversity?
Leaders are held accountable for meeting regional goals, and a system goal. The goals are tracked on an electronic organizational dashboard. The reporting occurs on a monthly basis. Currently, CHRISTUS Health's supplier diversity goal relates to the health care system's U.S. operations. Year over year since 2012, we have exceeded our targeted fiscal year goal. For fiscal year 2016, we set a target of 8 percent of total spend committed to diverse suppliers; and we ended the year at 11.2 percent of spend related to diverse suppliers. The total spend that supply chain is responsible for is about $1.2 billion; about $90 million of that went to diverse suppliers in fiscal year 2016.
Tell me about the vendor fairs CHRISTUS Health hosts to advance its supplier diversity initiative.
It's a new strategy. We had three vendor fairs in Louisiana: one in Shreveport in April, one in Lake Charles in May, and one in Alexandria in June. At the vendor fairs, we talk about different types of third-party certifications related to supplier diversity. (Certain third-party organizations verify a business has majority ownership by women, minorities or veterans. CHRISTUS Health relies on those certifications to track its progress toward its supplier diversity goals.)
There were 261 suppliers total at the three events. Of those, 77 suppliers that did not have third-party certification have since attained certification. We collaborated with the U.S. Small Business Administration, one of our vendors called Kazette Enterprises, and mayors' offices on these vendor fairs. We're in talks for similar vendor fairs in Texas.
What kind of expertise can CHRISTUS Health give small companies that they wouldn't have on their own?
We teach the vendors how to navigate through large organizations. We talk about the need to find out who the right person is as a point of contact, because talking to the wrong person only delays the process. We're working on an educational strategy for employers that need technical assistance, like how they can learn to put together a business plan.
How does a commitment to supplier diversity fit with CHRISTUS Health's Catholic mission?
There's a quote from our CEO Ernie Sadau that speaks to this importance that I use during my speaking engagements. He says, "Diversity and inclusion aren't new ideas to us at CHRISTUS Health. Their importance was instilled in us by the sisters of our sponsoring congregations, who remind us that every person is a creation of God, and all have value and deserve respect." This ties in very well with our mission to extend the healing ministry of Jesus Christ.
What can it mean in a community to have CHRISTUS Health committed to supplier diversity? More jobs, economic turnaround?
That's one of the great joys I get out of doing what I do. In one of the communities where CHRISTUS Health has a presence, a supplier lost a contract with us. It wasn't because of performance issues. A new company, that was not a diverse supplier, promised savings, and then there were not savings. I called on the supplier we used to do business with, which was a minority-owned company, and started talking with them. I asked how I could help them be better at what they do. Through discussions and working with them, they did re-land the contract with CHRISTUS Health. The company, which might have gone out of business otherwise, then hired 12 new employees, right from the community. Twelve families now have income because of the contract in a community we serve. If we want to impact local communities, we've got to work with local suppliers there.