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Keurig Green Mountain's creative approach to strengthening supplier relationships
Keurig, maker of the familiar single-serving coffee pods, involves its suppliers in community service programs.
Ask supply chain partners why they work well together, and they'll often mention having a "good cultural fit"—sharing similar values, priorities, and business cultures—as one of the keys to their success. But simply having those characteristics in common isn't sufficient; buyers and suppliers also need to strengthen and maintain those relationships.
Keurig Green Mountain Inc., a Waterbury, Vt.-based provider of specialty coffees and coffee makers, understands that. To help cement relationships with its suppliers, the company has taken an unusual path: involving them in its community service programs.
Keurig Green Mountain hosts an annual Top 100 Suppliers event for its most strategic suppliers. The company saw that event as an opportunity to connect with suppliers on a deeper level, one that went beyond sharing business strategies about new markets or product ideas.
One time-tested way to do that is through social gatherings. "Sometimes the opportunity for the next big idea is not in the conversation that you have over the conference table," explained Amena Smith, director of procurement, in an interview. "It's the conversation you have over the dinner table."
The planning team for the supplier event wanted to achieve the kind of relationship-building benefits that a dinner or a golf outing might offer while also tapping into a core part of the company's cultural identity: social responsibility and the importance of giving back. Every year, Keurig Green Mountain gives all of its employees 52 hours of paid volunteer time. "It's not just something that's 'on the books,' it's actively encouraged," Smith said. "There's talk about what our goals are going to be and, if we are not using our hours, how we can get together as a team and fulfill our community service goals."
Community service is so ingrained in the company's culture that it has a formal "volunteerism" team that helps to identify volunteer opportunities and facilitate those efforts. Smith and her procurement colleagues tapped into that expertise to design volunteer activities as part of their annual supplier event. This past year, those activities included sorting children's clothing and school supplies for the Boston, Massachusetts-based charity Cradles to Crayons and making "no-sew" blankets for local shelters and the Boston Children's Hospital.
According to Smith, the volunteer activities received high ratings from participants and have opened up new lines of communication between Keurig Green Mountain's employees and their suppliers. "There's something really lovely about working on a project with one another that's adjacent to the business but not the business," Smith said.
Keurig Green Mountain is not the only company to adopt this approach. The chemical and agricultural giant Monsanto, for example, has participated in community service programs with its logistics service provider C.H. Robinson Worldwide Inc. One of these volunteer events, for the international nonprofit Stop Hunger Now, took place in conjunction with last year's Council of Supply Chain Management Professionals (CSCMP) annual conference.Want to try it yourself?
For those who are interested in hosting similar events with their suppliers, the following advice from Keurig Green Mountain may prove helpful.
1) Find organizations that resonate with your company's culture. There are seemingly unlimited ways that a company can impact the greater good, but it's important to focus on volunteer opportunities that align with your particular company's culture. "We worked with groups that we had experience with and that had resonated with people who had participated in the past," Smith said.
2) Offer on-site and off-site events. It may be hard for some suppliers to give up four hours to participate in an off-site volunteer event. Recognizing this, Keurig Green Mountain provided both off-site and on-site opportunities. One group traveled to the Cradles to Crayons distribution center to sort clothes and assemble outfits for children, while others created no-sew blankets at the supplier event itself.
Keurig Green Mountain offered these different opportunities based on feedback from their suppliers. "The first year we didn't have a lot of participation [in the volunteer events]," Smith said. "When we sent out our after-event survey, we heard from the people who did volunteer what a great benefit it was for them, and from the people who couldn't do it how much they would have liked to participate if we had timed things differently."
3. Be authentic. Most importantly, Smith stresses that these events have to "be real." "This isn't something that you should pretend is important to the company. It has to be part of your core values," she said. "Don't fake it, because this is a really genuine kind of thing that people work on together, and if anything is false about it, it's going to be evident."
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