Aflac looking for more female, minority suppliers

Columbus-based insurance company wants to mirror national diversity trends

tadams@ledger-enquirer.comNovember 19, 2013 

The Aflac tower on Wynnton Road.

JOE PAULL — jpaull@ledger-enquirer.com

It’s a $24 million pie. And Aflac says it is looking for more than a few good female and minority suppliers to earn a slice of that business as it attempts to mirror increasingly diverse U.S. demographics.

“Last year we noticed that our supplier diversity numbers started slipping, and that really concerned us,” said Wassel Lewis, senior manager with Aflac’s stategic sourcing and procurement department.

That prompted the Columbus-based supplemental life and health insurer to take a hard look at what had caused the dropoff and how to improve.

It found that certain major suppliers that were once minority-owned had been gobbled up by large corporate entities, taking them out of that category. BET and Univision were among those, as well as Kaplan Thaler, its own advertising firm, which was bought out by Publicis.

Thus, the company known as much for its funny duck ad campaign as the serious side of insurance policies decided it was time to hold diversity supplier summits. The first took place in September and four more are budgeted for 2014, one each quarter.

“We think it’s the right thing to do,” said Laura Kane, Aflac’s vice president of corporate communications. “When you compare us to some of the other large companies that are doing it, our numbers, although we’re very proud of them, are still a little bit low. So we have a commitment to increase our numbers in 2014.”

Aflac currently uses more than 4,000 suppliers, of which 280 claim they are diverse, said Lewis. But only half of those are “certified” diverse by the Georgia Minority Supplier Development Council.

The company’s annual spending with minority-owned businesses is in the neighborhood of $24 million. Total spending on goods and services by the Fortune 500 company — Aflac ranks No. 118 with $25.4 billion in yearly revenue — far exceeds that, although the company declined to disclose that total.

The areas that Aflac spends in, naturally, is extremely varied. It includes information technology products and services, general consulting, legal services, accounting and financial needs, lobbying, marketing, media, sponsorships, travel, hotels, ground transportation, meals and catering, facilities maintenance and janitorial services.

“We spend a significant amount of money in a lot of these areas,” Lewis said of Aflac, which derives more than 75 percent of its revenues from insurance sales in Japan.

It all adds up to the company now moving toward doing business with more companies owned by women, African-Americans, Asian-Americans, Hispanics and other demographics that continue to increase in numbers both in the U.S. and globally.

“It’s still relatively new in terms of things that companies are trying to do,” Kane said. “But I think most forward-looking companies are thinking that it just kind of makes sense because of the way America is evolving and becoming such a diverse melting-pot population.”

Lewis conceded the effort is somewhat of a work in progress, with Aflac now working on a website that it expects to launch in 2014 to let large and small businesses know how they can become certified as diverse and the benefits of doing so. Dates for the summits have yet to be set as well, although the area of marketing will likely be the focus in the next one.

Lewis also stressed the firm would like to involve smaller businesses and, in particular, those who call the Columbus area home.

Being certified diverse doesn’t automatically land a potential supplier a contract or work order, he said. But it does work heavily toward getting a foot in the Aflac door.

“You’ve still got to show value; nothing changes there,” Lewis said. “And it’s not going to get you more business per se. But it will certainly open up the opportunity for networking to potentially get more business. Again, your product has to be wanted.”

The U.S. Census Bureau’s 2007 Survey of Business Owners found that there are more than 263,000 minority companies in Georgia. That includes nearly 184,000 owned by African-Americans, more than 46,000 by Asians, nearly 33,000 by Hispanics, roughly 6,000 by American Indian and Alaska Native and 1,145 by those of native Hawaiian or Pacific Islander descent.

Aflac’s workforce, meanwhile, is 68 percent female, with minorities making up 43 percent of staffers.

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