In 2022, Freddie Mac wanted to build on its successful Tier 1 Supplier Diversity Program by launching a Tier 2 Supplier Diversity Program. In partnership with TealBook, Freddie Mac accelerated their Tier 2 Supplier Diversity Program resulting in 80% of its non-diverse spend reporting Tier 2 spend within 10 months. Freddie Mac is raising the bar by focusing on 100% of their non-diverse spend reporting Tier 2 spend in 2023.
The Story of Freddie Mac
Freddie Mac was charted by Congress in 1970 to support the U.S. housing finance system and to help ensure a reliable and affordable supply of mortgage funds across the country. Rather than lending directly to borrowers, Freddie Mac operates in the U.S. secondary mortgage market, buying loans that meet their standards from approved lenders. Those lending are then, in turn, able to provide more loans to qualified borrowers and keep capital flowing into the housing market. Freddie Mac makes home possible in markets that might otherwise be underserved, and helps families rent, buy, and keep homes they can afford.
Supplier Diversity is an essential element of the Freddie Mac supply chain, and they have supported diversity in contracting for more than 25 years, awarding millions of dollars in contracts to diverse suppliers. Freddie Mac’s Enterprise Supply Chain (ESC) department maintains centrally governed processes to meet the procurement needs of the enterprise. ESC’s procurement process is designed to mitigate supplier risk, promote supplier diversity, drive speed to market, and manage spend.
The Reason Freddie Mac Chose TealBook
Freddie Mac had a relatively mature Tier 1 Supplier Diversity Program achieving best-in-class levels of percentage of spend with diverse suppliers before meeting TealBook in 2020. Freddie Mac chose TealBook over other potential partners because they provided the best solution to mature their diversity program including state-of-the-art machine learning to deliver supplier data light years ahead of self-reported data feeds.
The capabilities of TealBook accelerated Freddie Mac’s Tier 1 and Tier 2 diversity programs. On TealBook’s first review of Freddie Mac’s Tier 1 Supplier Diversity Program, they found almost a 100% match rate which is an excellent sign of a well-run program. To enable Freddie Mac to see the data in real-time, TealBook created a user-friendly Tier 1 Supplier Diversity dashboard, breaking down the spend into diverse groups more readily. Also, TealBook’s accurate supplier catalog assisted Freddie Mac in identifying new sources by spend category resulting in new diverse suppliers to further improve Freddie Mac’s percentage of diverse spend in 2022.
Elevation of Freddie Mac’s Tier 2 Supplier Diversity Program
It was a natural progression as Freddie Mac was embarking on optimizing its Tier 2 Supplier Diversity Program to partner with TealBook. Freddie Mac and TealBook created a joint approach to reach out to the largest non-diverse suppliers first to request their Tier 2 spend information.
Using TealBook’s platform, Freddie Mac’s non-diverse suppliers readily adopted the streamlined and confidential approach for requesting Tier 2 spend data. In addition, TealBook provided Freddie Mac’s non-diverse suppliers the extra perk of using the application to identify their diverse suppliers if necessary. As a result, through a quarterly communication and collection process, Freddie Mac grew its Tier 2 Supplier Diversity Program from 0% to 80% supplier participation in a matter of 10 months. This remarkable outcome shows the ease of use and value proposition of TealBook’s Tier 2 Supplier Diversity Program tool kit.
This partnership has been instrumental in accelerating Freddie Mac’s Tier 2 Supplier Diversity Program as they work towards achieving their 100% participation goal in 2023.