The following is a guest post from Rich Weissman, a professor at Endicott College. Opinions are the author’s own.
It’s your right to shop where you want.
As a consumer, I’ve made personal procurement decisions based on a company’s strategy, leadership, and operational initiatives. It is my choice to purchase products and services from companies that support my values. And while I may not agree with companies like Harley-Davidson and Tractor Supply publicly rebuking their DEI initiatives due to customer pushback, I support the power of the consumer to make procurement decisions.
Your money. Your choice.
But the latest announcement by Harley Davidson rolling back their DEI program took it a step further. They removed their support of supplier diversity. To me, that is going too far.
As someone with decades of procurement experience specializing in supplier development, I can foresee several potential impacts on the business. There may be impacts to the bottom line, in the form of lost tax benefits or lawsuits. Perhaps worse, existing suppliers that qualify for historically-underutilized business programs, known as HUB suppliers, may feel betrayed. Altogether, the impacts could significantly hamper supply chain resilience.
As of this writing, the Harley-Davidson ‘Supplier Network’ site is still available online, and it strongly supports the inclusion of diverse suppliers.
“It is the policy of Harley-Davidson Inc. (H-D Inc.) that in acquiring goods and services we maintain an environment that promotes, increases, and improves the quality of the overall participation of certified diverse business enterprises,” the website states. “H-D Inc. is committed to assisting diverse business enterprises in gaining access to business opportunities within the company. H-D Inc. will also assist in developing and strengthening diverse businesses enabling them to become stronger suppliers.”
Working with HUB suppliers brings value beyond just fulfilling a DEI agenda — it diversifies the supply chain, often leading to innovation and cost efficiencies.
HUB suppliers, which include minority-owned, women-owned, and veteran-owned businesses, often bring unique perspectives and solutions that enhance the company's competitive edge. By actively moving away from these partnerships, the supply chain is less resilient and adaptable.
Many DEI initiatives, including partnerships with HUB suppliers, are often tied to tax incentives, government contracts, and grants aimed at promoting economic inclusion. By eliminating DEI efforts, the company might lose access to these financial benefits, which could have a direct impact on the bottom line.
To make matters worse, the reaction from existing and potential HUB suppliers is likely to be one of disappointment and anger. For many of these businesses, partnerships with larger companies are vital to their growth and sustainability. The loss of a significant partner like Harley-Davidson could result in financial instability, particularly for smaller HUB suppliers that may not have a diversified customer base.
Diverse suppliers may feel betrayed by the sudden change in strategy, especially if they have made investments or strategic decisions based on a long-term partnership. They may choose to voice their concerns publicly, potentially joining forces with other affected parties to advocate for the reinstatement of DEI initiatives. This could result in public campaigns or legal actions and pressure management to reconsider its decision.
Some suppliers, and not just HUB suppliers, may choose not to do business at all with Harley-Davidson. Suppliers have the right to do business with companies with aligned values. Some critical suppliers may decide to disengage, creating potential supply chain turmoil.
A headline in the business pages of companies renouncing DEI may placate unhappy customers for a while. But the ramifications of rejecting supplier diversity will be a long-term problem. I hope the procurement folks at Harley-Davidson were part of the change in strategy.
My gut tells me they weren’t.
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