Medtronic has developed a world–class global supplier diversity program by embedding supplier diversity in the organization's DNA. It is an impressive effort producing results that are the envy of other companies across industries.
— By Sharon Ross

There are supplier diversity programs, and then there are world-class supplier diversity programs. Medtronic has the latter. The company is a standard bearer in supplier diversity and in responsible sourcing. Success flows from Medtronic's ability to maintain the highest quality standards in medical technologies and services, and in its proactive efforts to build and maintain a transparent, collaborative, and diverse global supply chain.

Marie O'Malley, Senior Director of Supplier Outreach for Medtronic, actively promotes and drives inclusive sourcing for the entire company through a variety of initiatives and activities. Her passion for inclusion is evident as she builds a network of supplier partners all working together to contribute to Medtronic's mission to alleviate pain, restore health, and extend life. It is a remarkable company in a competitive industry in which quality is of the utmost importance.

Entrenching the Supplier Diversity Program
Marie's proactive approach includes an impressive array of initiatives and activities that makes one wonder how she gets it all done. She liaises with government contacts and development boards to advance a diverse global supply chain, develops business unit annual plans, conducts regular employee training, and promotes advocacy of organizations focused on small diverse U.S. suppliers.

Marie leads a team that has an overarching goal: Create a world class supplier diversity/small business program. Medtronic's supplier diversity collaborative efforts include leadership representation from across the organization and communication with diversity-focused internal groups to ensure supplier diversity is part of the company's DNA.

Developing a quality and sophisticated global supplier diversity program is a step-by-step process. The supplier diversity team first built the infrastructure that includes websites, a supplier registration portal, outreach initiatives, eLearning initiatives, and program reporting processes.

The next step, Marie states, is focusing on "developing and implementing strategies and tools that take the program to the next level." To do so, she is working: to deepen the engagement of business unit executive management; to enhance inclusion of supplier diversity in business processes; to broaden marketing and sales strategies; and to leverage diverse suppliers in the supply chain.. Marie and her team members proactively outreach by attending supplier diversity events, collaborating with majority suppliers, and facilitating meetings between diverse suppliers and Medtronic's stakeholders.

Contributing to Social, Ethical, and Environmental Goals
Marie is not only responsible for supplier diversity. Her leadership role also includes two other initiatives – responsible sourcing and conflict materials. "I combine and include all three initiatives as part of my steering committee that include Medtronic's senior leaders. By raising awareness and visibility of the team, we increased our supplier diversity spend by 7 percent last year," states Marie.

The innovative Medtronic supplier diversity team is transparent, empowered, communicates quickly and often... Under her leadership, the team now receives direct visibility from Medtronic's CPO, John Klein, further entrenching supplier diversity in the company's DNA.

Building a successful global supply chain is a process of implementing best practices. Marie integrated the Billion Dollar Roundtable Best Practices, which include policy and planning, sourcing & supply chain, communications, tracking and supplier development. Marie also developed compelling dashboards to monitor organizational behaviors, drive greater understanding and accountability, allowing for accurate reporting. Marie continues to communicate the value of supplier diversity is critical to program success with stakeholders.

Medtronic developed global supplier standards to guide efforts to develop and maintain a sustainable global supply chain. The standards describe the minimum social, ethical, and environmental requirements and expectations for suppliers. Marie's supplier diversity team is not just focused on finding and leveraging diverse suppliers – It also fosters human rights, environmental stewardship, social responsibility, product quality and innovation.

Growing a successful diverse supply chain depends on many things, but one of the most important is ensuring the diverse suppliers utilized are ready to contract with a company the size and complexity of Medtronic, which includes meeting responsible sourcing standards. This is the reason that Marie ensures that suppliers have development opportunities for sustainable growth while adhering to Medtronic’s global supplier standards.

Anchoring Corporate Strategies in the Supply Chain
Marie regularly leverages top suppliers as a source of information and as anchors in Medtronic’s supply chain to keep strategies on target.

"Last year, I led the Medtronic Supplier Excellence Conference (MSEC)on behalf of our global supply management team. The conference brought together 100 top suppliers for a discussion on Medtronic's strategic goals and the role of suppliers in the journey. The learnings from this conference place them in a better position for continued growth at the company," she explained.

Innovation is vital to Medtronic's ability to stay competitive. Innovation strategies in this space include recruiting top suppliers to assist smaller diverse suppliers with developing high standards of quality; developing a global network of partners that strengthen Medtronic's ability to deliver products, therapies, and services that improve lives; and keeping opportunities, such as the annual supplier conference, available for suppliers to share, vet, and execute ideas.

Marie's successful strategies were highlighted when almost half of the Supplier Excellence Awards at MSEC were given to small and diverse suppliers. Invaluable to Marie's efforts are the advocacy partnerships with Diverse Manufacturing Supply Chain Alliance (DMSCA), Women’s Business Enterprise Council (WBENC), National Minority Supplier Development Council (NMSDC) Disability:IN, National Gay & Lesbian Chamber of Commerce (NGLCC), Diversity Alliance for Science (DA4S), and the National Veterans Business Development Council (NVBDC). These organizations continually help Marie build and develop a community of capable diverse suppliers.

Goal setting for the supplier diversity program at Medtronic revolves around embedding supplier diversity practices into the business strategy. Goals and best practices are divided into specific categories, and within each category are specific objectives. Categories include policy and planning, sourcing and supply chain, communication, tracking, supplier development, and additional specific goals like growing Tier II diverse supplier spend and increasing diverse supplier inclusion at 50 percent of RFP events. Marie explains, "Goals are qualitative and quantitative. For example, we measure the number of diverse suppliers included in RFPs, set goals for stratifying prior to an RFP, and include measurable language in contracts that advance participation."

To date, the focus has been primarily on the Tier I program, but Marie is now in the process of managing the early stages of a Tier II program strategy. There is already significant progress with the recent engagement of the largest suppliers in growing the Tier II program for a shared commitment to developing a diverse supply chain.

Quality Approached Holistically
As a company developing and selling medical technologies and services, quality is naturally of the utmost importance to Medtronic. Quality is approached holistically through product and services development, adoption of closed-loop processes, proactive and early identification and response to issues, collaboration with physicians and transparency. There are challenges in finding diverse suppliers whose business focus is medical device. The FDA and the industry itself hold Medtronic to strict quality standards that encompass specialized facilities, sophisticated production process, mature quality systems, and the financial capacity to operate through low/no revenue product development cycles. Few suppliers can meet industry and government requirements. This does not deter Marie who passionately believes that diverse suppliers are crucial to Medtronic's ability to have the most powerful positive impact on people's lives.

Much Work Yet to be Done
Medtronic can be proud of its many accomplishments, which can be found in its annual integrated report. Accomplishments to date include donating more than $100 million to philanthropic efforts benefitting local communities, investing $2.3 billion in R&D, investing $139 million in training for medical professionals, surpassing four of the five 2020 Environmental Performance Goals, surpassing 2020 aspirational goals for diverse talent with 21 percent of leadership positions in the U.S. held by ethnically diverse people, and spending $1.8 billion with small and diverse companies. Despite all these accomplishments, Medtronic pushes forward to achieve much more.

"We know there is much work yet to be done," says Marie, "but we are proud of the progress we have made to date and are excited about the future." It is this perspective that keeps Medtronic a leader in the diversity space.