Building a Successful Supplier Diversity Program with Baker Hughes

At Baker Hughes, supplier diversity is integral to its business strategy. In Australia, diverse suppliers are defined as organizations where at least 51% of ownership, operation, or control rests with a specific underrepresented group, such as those owned by minorities, women, veterans, Indigenous people, LGBTQ+ individuals, or people with disabilities.

We will explore this strategy through valuable insights from three leaders: Anoop Kurup of Baker Hughes, Sharna Collard of Kooya, and SAP Taulia’s Bob Glotfelty.

The purpose of Baker Hughes’ supplier diversity program is to promote inclusion for a fair and meaningful chance for everyone, while also strengthening local economies by fostering job creation in underserved communities. Tapping into a diverse supplier base also drives innovation in procurement practices, as diverse suppliers, according to Anoop, “bring unique ideas, agility, and niche expertise that can lead to better products and services,” contributing to business growth.

The program also reflects Baker Hughes’ corporate responsibility values that are core to its operations. As supplier diversity metrics become a contractual requirement for corporate procurement practices, Anoop states that social responsibility is “no longer a choice or an option,” but a “core expectation from modern consumers and clients.”

The Impact: A Story of Transformation and Reciprocity

For Sharna, CEO of Kooya (a supplier to Baker Hughes), supplier diversity programs have a transformative impact. The program with Baker Hughes has not only opened up opportunities that they may previously not have had access to, but has also “created a platform for us to showcase our quality and innovation that we bring to the table.”

This partnership balances purpose and profit. For Kooya, this means starting with smaller opportunities and showcasing their value, paving the way for them to scale and grow alongside an organization. Sharna notes that genuine partnerships like this have been “the key to Kooya’s success.”

Built on reciprocity, Kooya extends this principle through its non-profit arm, the Bibbulmun Fund. Established in 2014, this community investment initiative fosters leadership and entrepreneurship, aiming to create economic independence for Indigenous communities. By channeling 5% of Kooya’s net profits into the Bibbulmun Fund, supplier diversity partnerships achieve a far-reaching social impact.

The Steps to a Successful Program

Scaling a supplier diversity program for a large organization like Baker Hughes is more complex than it might seem. As Sharna states, it must be “led from the top down” and “needs to be intrinsic within the organization and requires everybody’s buy-in.”

Baker Hughes followed a robust approach. The Reconciliation Action Plan (RAP) in Australia provided a structured framework to take meaningful action on reconciliation with Aboriginal and Torres Strait Islander people. This marked a strategic shift towards inclusive procurement practices that embed social, environmental, and economic value.

Cross-functional communication was also key. Awareness and training sessions were conducted across internal teams to educate stakeholders on the importance of supplier diversity and inclusive procurement.

To ensure the program’s longevity, Baker Hughes collaborated with external organizations to build partnerships with diverse suppliers, such as We Connect International and Supply Nation. As Australia’s supplier diversity leader, Supply Nation links corporates and government businesses with Aboriginal and Torres Strait Islander businesses. This was where Baker Hughes was connected with Kooya.

A key part of Baker Hughes’ strategy is measurement, and clear KPIs were set to track spend with both Tier 1 and Tier 2 diverse suppliers. This commitment is evident in their results: in 2024, Baker Hughes reported approximately $632 million USD spent globally with its diverse and small business suppliers.

Ultimately, it’s this blend of process and genuine commitment that ensures success. Sharna notes that what stands out with Baker Hughes is that “It’s not just this tick and flick. There are real relationships, meaningful outcomes, and most importantly, a fantastic way to build credibility and capability…”

Technology is key

A critical pillar supporting the Baker Hughes program is technology designed to empower suppliers. Baker Hughes has partnered with SAP Taulia to offer early payments to its diverse suppliers, empowering them with faster and reliable access to liquidity, a crucial element for managing working capital and fueling growth. Over the past five years, the early payment program has scaled to support Baker Hughes’ suppliers globally, from APAC, all the way to North America.

As Bob explains, the supplier-centric program is optional and user-friendly. Suppliers receive an invitation and can enroll in just 90 seconds, gaining free access to a portal that provides full visibility into their invoice status.

Once an invoice is approved, suppliers have the option to request early payment at a favorable rate based on Baker Hughes’ strong credit rating, a significant advantage over traditional financing.

SAP Taulia’s flexible program is more than a convenience; it’s a tangible way Baker Hughes invests in the resilience and sustainability of its valued diverse suppliers.

Strategic Takeaways

The journey of Baker Hughes and Kooya spotlights a clear blueprint for success. Supplier diversity thrives when it is intrinsic to a company’s operations, supported by robust processes, and enabled by flexible technology like SAP Taulia that strengthens supply chain resilience.

For businesses looking to establish a supplier diversity program, the leaders have provided powerful advice from both sides of the partnership. Sharna encourages Aboriginal and Torres Strait Islander businesses to “know your value and tell your story clearly,” emphasizing that while diversity is a strength, communicating the unique value of one’s products and services is crucial. Noting the importance of building strong partnerships with like-minded businesses, Sharna advises that mutual commitment to a collective goal and objective is key to success.

For corporations, Anoop recommends going beyond one-time purchases by “actively investing in the growth and sustainability of diverse suppliers” through mentorship, training, and flexible access to capital via supplier-friendly technology such as SAP Taulia.

These principles form the cornerstone of an impactful program. By building meaningful and lasting partnerships that fuel mutual growth, companies can create a more equitable business ecosystem for all.