Impact Sourcing

Igniting Change Through Social Impact: 11 Lessons Learned at IAOP Social Impact Meeting of the Minds (Part 2)

6. The industry has a key role to play in work readiness for impact sourcing workers.

BPO companies want to hire impact sourcing workers but the missing catalyst has been having the scale needed where the centers are located and ensuring the individuals are prepared to work in an international business environment, said Jon Browning, CEO/Board Chair, Global Mentoring Initiative (GMI).

The speakers noted that the expectations of BPO companies hiring and the readiness of workers coming out of colleges and vocational training programs often don’t match. Additional coaching and training are needed on basic skills such as communication, dress code, and job punctuality.

Large-scale training, investments, and common standards can help ensure consistent quality of workers. Hallard noted that guiding principles will be needed to ensure companies train impact workers with the right skills required.

Tim Hopper, Cloud Supply Chain Sustainability Manager, Microsoft, shared how the company was an early mover in impact sourcing in the early 2000s when it recognized the positive community benefits its call center in India was having. It launched community technology centers (CCTs) to provide access to technology and training to empower the local workforce.

Sutherland was the first buyer to join in this informal initiative to come together to make a social impact without a big financial burden on any of the players. The CCTs took off over the years and now have trained over 100,000 people around the globe.

7. Impact sourcing needs to have certification and internal metrics to rise to the next level.

Impact sourcing can benefit from creating standards and a common language, following a pathway similar to the environmental aspect of ESG that made it measurable and concrete, said Jim Donovan, Co-Founder & CEO, ADEC Innovations.

Having standards is important, he said, because they improve performance, reduce risk, benefit global communities and further align with the United Nations’ Sustainable Development Goals (SDGs).

Hopper also spoke about the importance of measurement. He shared how Microsoft created a model for interacting with its social enterprises that is measurable and has a certification. The company awards suppliers for their impact sourcing achievements and has also added them to some scorecards and contracts.

“The measurement piece was tricky but it was essential to move the needle forward,” Hopper said. “All buyers are looking for social and environmental impact. It’s a given in my space. We really hone in our Tier 1 suppliers on measurement.”

Donovan called for a coalition of buyers, providers, and others in the industry, armed with data, to define how to measure impact sourcing, including developing a pathway to improvement. Standards, guidelines, and clear measurements for consistent reporting on results are necessary to establish trust with buyers.

Hooper agreed with the importance of joining forces. “It’s about finding like-minded people,” he said. “This all started because people had a heart for this. How can we take what we do in our day jobs and make the world better than we left it? You capture the hearts of people and then their minds will follow.”

8. The focus of impact sourcing should be expanded into Diversity, Equity, and Inclusion (DE&I) efforts to garner greater attention.

While the goals of supplier diversity programs and impact sourcing are similar, diversity programs have had established requirements for the past 40-50 years based on the ownership of the company, such as small businesses, women, or veteran-owned businesses.

Impact sourcing is more about the workforce diversity of the supplier versus the ownership of the supplier so it doesn’t meet the requirements for buyers, said Amy Fong, Everest Group partner leading the Sourcing and Vendor Management practice.

To elevate impact sourcing to the next level and reach the so-called “Billion Dollar Roundtable,” where companies spend that amount with diverse suppliers, impact sourcing needs to have a certification process and internal scorecards to give it legitimacy, she said.

9. Build impact sourcing as a brand and create a compelling value proposition 

To encourage service providers to join in collaborative efforts to develop impact sourcing standards, an attractive value proposition for participating has to be created, Donovan said.
“We need to start the process of creating value around the brand of impact sourcing and making a public announcement that this is our journey, our road map and the early adopters and we want more people on the journey,” he said.

By building the value proposition and rigor around measuring impact sourcing, it will eventually become a norm that others will follow. Incentives to participate in the movement and education also will provide needed pushes, Donovan said.

10. Responsible outsourcing is a powerful tool against modern-day slavery.

Modern-day slavery, also known as human trafficking, affects more than 50 million people and is the world’s fastest-growing crime, bringing in $150 billion a year and exploiting men, women, and children who work for little or no pay in extremely dangerous work conditions, said Rachel Ramenda, Founder of Stop Modern Day Slavery.

Outsourcing companies are uniquely positioned to stop this crime by practicing responsible business practices. “By providing work that pays fairly and treats workers ethnically, we can take power away from human traffickers and their manipulation practices,” Ramenda said. “If done right, I believe impact sourcing has the power to end human trafficking once and for all.”

11. The industry needs to collaborate on a standard for ethical wages that moves away from minimum wage.

Jessica Mony, Head of Social Impact & Partnerships, Appen, described the difficulties in determining fair wages, particularly in countries that don’t have minimum wages and with varying rates across geographies.

She called on the audience to collaborate on a standard that moves away from minimum wage and also to consider creative approaches for compensating impact workers, such as providing accommodations like daycare for single mothers, and additional opportunities to take exams or laptops for remote employees.

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