Wal-Mart Looks to Suppliers to Boost Diversity, Image, and Business

In a nice piece of reporting yesterday (sorry, but this was the paper version and online requires a paid membership), the Financial Times noted that Wal-Mart has plans to push its vendors "to hire more women and members of ethnic minorities."

I could add an ironic end - "but to not promote them" - and leave things there, given that the über-retailer is still facing the class action sexual discrimination suit in the U.S. And certainly the company has been known to take steps to try bolstering its image. But when it comes to changing its supply chain, Wal-Mart is not known as a company that will do things for show. This is the heart of its effectiveness. And the new program starts with suppliers to its financial department - and some key suppliers of food and merchandise.

This is not a company whose culture would allow monkeying with fundamental business relationships or processes without a good business reason. The FT quotes Wal-Mart general counsel Tom Mars as saying, "This is not about preferences, or supporting minority-owned businesses. It is about becoming more relevant to our customers by partnering to our key suppliers and encouraging them to bring more diversity to our account representative teams who are the people helping us to get the right merchandise and the right food to our customers."

And that's the heart of the lesson I think most companies could draw from this example. Diversity isn't about management feeling good about itself nor burnishing an image. As true so often with doing the right thing, emphasizing diversity is bottom-line smart long-term business. When you have people involved in key ways with your business that are from the communities and demographics to which you sell, you've got a better chance of making customers happy. Do right by employees, customers, and communities, and you can't help getting a positive image. I'd also suggest that doing well in such a context is a potentially far deeper and committed way than wanting to join a moralistic bandwagon. When you see that the right thing is really the right thing for you, then there's a much smaller chance of falling off that wagon.