Minority suppliers: breakthrough thinking to succeed.
"It takes some breakthrough thinking to grow in today's environment," says Chicago-based supplier diversity expert Ralph Moore. "The first question for business planning in 2005 is, 'How will I create a larger business?'"
Moore, of course, has a number of practical answers to this question. He recommends creating alliances or partnerships and finding large corporate clients committed to growing their relationship with individual minority suppliers.
Strategic sourcing continues
Fortunately, the number of companies committed to this is growing, as more and more major corporations realize that "strategic sourcing" has taken a toll on their minority supplier relationships. Strategic sourcing is a euphemism for streamlining the supplier base and working with fewer, usually larger suppliers that can produce on a national or even global basis. This trend has been going on in corporate America since the early 1990s. It allows companies to drive down the cost of purchases, deal with fewer relationships, and, all in all, better manage their supply chain.
As Harriet R. Michel, puts it, "Pressure on minority suppliers is greater than ever. Size, scope, and capability are the challenges for minority businesses today." Michel should know, since she is the President of the nation's leading accreditation organization for minority suppliers--he National Minority Supplier Development Corporation (NMSDC).
She agrees with Moore that minority suppliers must find new ways to grow, and alliances and partnerships are among the best routes. At the same time, it may be more practical for MBEs to grow through ongoing relationships with corporate clients-or a Tier 1 supplier anxious to jump start its own program for minority and women-owned businesses.
Two examples of companies that are working hard to expand existing relationships with MBEs are Sodexho, a leading contract management services company and Johnson Controls, global market leader in automotive systems management and control. Darlene Fuller, Director of Supplier Diversity for Sodexho, says it is common to "start small" with a new supplier including MBEs, and then work to expand the relationship, and while making sure the supplier has the infrastructure for expansion--after that supplier has proven itself on the first contract.
Johnson Controls has also increased its commitment to minority suppliers. Today it has an internal website where suppliers can register. It has automated its diversity program for closer monitoring of diversity contracts, as well as the diversity spending of prime contractors and key suppliers.
Growth in supplier diversity programs
Sodexho and Johnson Controls are not alone in their focus. The number of companies with supplier diversity programs has jumped in the past 18 months, perhaps reflecting a pick-up in the nation's economy. In fact, Michel says, "This year, we have had the largest rise in the number of new national corporate members at the NMSDC that I can remember in 16 years--lear evidence that more corporations than ever support supplier diversity," she says.
Diversity purchasing is also on the rise, according to Michel's organization, the NMSDC. She reports the total MWBE spend by corporate members for 2003 may reach $80 billion, compared to $72.1 billion in 2002.
Michel attributes this growth spurt partially to the pressure corporations are putting on Tier I suppliers to make sure they carve out a portion of their contracts with MBEs. Secondly, she says that corporations have begun to take demographic shifts in the U.S. more seriously. They see fast growth in minority populations and spending power and acknowledge that in a few decades minorities will account for 50 percent of the population. Along with this has come pressure from customers for more minority purchasing. So companies are scrambling to create a more positive profile.
Finally, keep in mind that it is your superior product and service not the fact that you are a small and/or minority-owned business which will enable you to grow with a corporation, once you have your foot in the door. Corporations may provide special support for you as an MBE such as access to the Kellogg University programs supported by NMSDC. But ultimately, it is up to you as head of your company to make sure you are producing what the client wants--and building the infrastructure to handle larger contracts.
Asbury Towel Networking Put Asbury Towel in Touch with Sodexho
It pays to network. That is how Asbury Towel President Maurice Jones first met a representative from Sodexho, a leading contract management company in the food and facility management industry. Jones was attending a networking event organized by the Multicultural Food Service and Hospitality Alliance (MFHA). This resulted in an opportunity at one of Sodexho's approved distribution centers, for a contract carve-out for Asbury Towel, a provider of disposable food service towels. Darlene Fuller, Director of Supplier Diversity, states, "We wanted them to grow at a reasonable pace. We worked closely with them and the relationship has been very successful." Today, Asbury Towel provides towels for four distribution centers and soon a fifth. For more information on purchasing opportunities at Sodexbo, visit the WEBSITE at www.sodexho.com/div_supplier.asp and/or contact Darlene Fuller, Director of Supplier Diversity at Darlene.fuller@sodexhoUSA.com.
PhotoVisions Starting Small Allowed PhotoVision to Grow at Major League Baseball
David Perry's company, PhotoVisions, has grown with Major league Baseball (MLB). In January of 2004 the firm won a contract to photograph the Detroit Tigers Spring Fantasy Camp. That assignment went so well that Perry was invited to make an in-person presentation at the annual conference of the MLB's Diverse Business Partners Program-one of only three suppliers invited to this event. As a result of that presentation, plus the high quality of his work and excellent national reputation, Perry was asked to become the drier photographer for a nationwide ad campaign for Major League Baseball. For more information about purchasing opportunities with MLB visit the WEBSITE at www.mlb.com/dbp and/or contact Wendy Lewis, V.P., Strategic Planning for Recruitment & Diversity, at firstname.lastname@example.org. You call reach David Perry at 1-800-578-0009 or www.PhotoVisions.net.
At Sodexho, we recognize the value of minority- and women-owned businesses, and realize how important they are to our company and the communities in which we operate.
As part of our commitment to support the growth and development of these businesses, we launched a supplier diversity initiative, headed by a full-time Director of Supplier Diversity, which focuses on providing opportunities for these companies to join Sodexho's extensive network of vendors and service providers.
Expanding our supplier base to include minority vendors is not only good for the vendors themselves, it also benefits local economies. And it's good for Sodexho's clients and customers. Products and services obtained from a diverse supplier base provide us with the finest products for our menus and great service, making our offerings to our customer stronger and more competitive. In turn, our vendors benefit from wider exposure and our best practices--a win-win for both companies.
Every year, Sodexho continues to increase the number of minority- and women-owned business enterprises that provide us with products and services that meet our high standards of quality, competitive pricing and service. We currently partner with more than 2,000 diverse suppliers throughout the United States. Our spending with minority and women-owned companies rose 20% in Fiscal Year 2005 to $147 million. We contract with these suppliers for a wide range of products and services including food, paper products, dining implements, chemicals and cleaning supplies, printing, office supplies, uniforms, equipment for foodservice, facilities, and environmental, local services including linens, florists, etc., temporary labor, consulting services, public relations, and advertising.
Sodexho is proud to be the industry leader in purchasing products and services from diverse vendors. And we are pleased that our Supplier Diversity program has enabled us to partner with such leading companies as Abuelita Mexican Foods/S&K Industries, Inc. of Manassas, Virginia, which received the Sodexho 2004 Diverse Vendor of the Year Award.
Did You Know?
Businesses owned by people of color are growing four times faster than the national average.
--U.S. Chamber of Commerce
Kodak Earns Two Honors from Upstate New York Regional Minority Purchasing Council
ROCHESTER, N.Y., July 9--The Upstate New York Regional Minority Purchasing Council recently recognized Eastman Kodak Company with two awards for the company's efforts to expand its relationships with diverse suppliers.
Kodak was named Corporation of the Year by the council, which works to strengthen relationships between minority suppliers and companies. The council also recognized Tamara Jones-Smith, supplier diversity assistant, Worldwide Purchasing, as its Advocate of the Year.
"These awards further validate Kodak's ongoing emphasis on working with diverse suppliers," said Joyce Wichie, Director, Supplier Diversity, Worldwide Purchasing "By expanding our efforts to reach out to minority- and women-owned business, we tap into the best ideas from suppliers in the communities where Kodak does business."
Kodak recently reported that it is on-track to meet its self-established goals for domestic spending with diverse suppliers. Created in late 2001, the goals commit Kodak to place 10 percent of its annual domestic purchasing of materials, supplies, and equipment with minority- and women-owned enterprises by 2006. The company anticipates meeting the goals within the next 18 months, ahead of original estimates.
Since Kodak set the goals, spending with minority-owned businesses has increased about 150 percent. Spending with women-owned businesses has risen by 108 percent.
Business owners can determine if they meet the requirements for minority- and women-owned businesses to work with Kodak by visiting http://www.kodak.com/go/supplierdiversity. The web site offers details explaining Kodak's supplier diversity program, and provides an online application.
Did You Know?
Taken together, women and minority business enterprises generated $495 billion annually of collective revenue as of 1997.
--U.S. Census Bureau
For over 20 years the Altria Family of companies has been at the forefront of Supplier Diversity. We are proud of our successes and all the businesses that we have helped grow and develop. Last year alone, we spent over one billion dollars with minority and women owned companies.
In our operations, we have seen that working with a wide range of ambitious suppliers provides a competitive edge in producing high quality, low-cost, innovative products for people around the world. We welcome new ideas and energy, for the entrepreneurial spirit of our founders still drives our growth today.
Shawn D. Buchanan, President, All American Meats Inc., a leader in providing meat products explains, "gaining access to a multibillion dollar corporation can be a tough process, however, the people at Kraft worked hard to help me become a key supplier to their company; they ensured that I got an equal opportunity for business and were committed to making the relationship work. Supplier diversity and supply chain management worked hand in hand to help me. I know this program works," says Shawn.
The Altria supplier diversity team understands that the success of all diversity and inclusion programs is vital to the growth of the corporation. Connie Smith at Philip Morris USA Inc., Chris Knox at Kraft Foods Inc. and Keith Hines at Altria Corporate Services, Inc. are dedicated to helping qualified minority and women owned business achieve their goals. Our support of supplier diversity reflects a long-standing commitment to providing equal opportunity and access.
If you would like more information on how to become a part of our supply chain please visit our website at www.altria.com/mwbe
At The Boeing Company, attention to the diversity of our supply base is almost as old as the company itself. One of our first contracts, in 1915, was with Mr. Tsu Wong, who provided aeronautical engineering expertise for designing a new-generation seaplane--the Model C trainer--that helped Boeing win its first major contract, with the U.S. Post Office.
Today, Boeing does business with more than 11,000 small, minority- or woman-owned businesses. In 2003, we placed $1 billion with minority and women-owned suppliers. Among them was World Wide Technology, a value-added reseller of computing equipment recently ranked No. 1 on the BE INDUSTRIAL/SERVICE100 list for companies.
Boeing supplier diversity efforts have been recognized nationally and regionally. The first aerospace company named Corporation of the Year by the National Minority Supplier Development Council, Boeing has been a member of the NMSDC's board for more than 30 years.
Because the marketplace changes constantly, Boeing continues to explore creative approaches to increase subcontracting opportunities for diverse businesses within our current and future environment. Among our current strategies are:
* Targeting minority- and women-owned small businesses, businesses in HUBZones, veteran and service-disabled veteran businesses, and Historically Black Colleges and Universities and Minority Institutions (HBCU/MI) through our supplier diversity program.
* Mentoring diverse companies to grow into future business associates via internal efforts and participation in Department of Defense and NASA Mentor-Protege programs.
* Linking small, minority- and woman-owned firms to companies with complementary strengths to increase their mutual business opportunities.
* Working with our first-tier suppliers to ensure that they develop opportunities for diverse suppliers.
We encourage African-American business owners to visit our web site at www.Boeing.com to learn more about The Boeing Company and to register their company as a potential supplier.
Did You Know?
The BE 100s-the nation's largest black-owned companies and firms-generated revenues of more than $22 billion in revenues in 2003
--Black Enterprise, June 2004
We take diversity seriously in all aspects of our business--including the companies that supply us with the wide array of products and services that enable us to serve our customers. Our program identifies women-and minority-owned companies that can offer cost-effective solutions to our business needs. Working with women- and minority-owned businesses not only fosters strategic and mutually advantageous business relationships, but has the added benefit of stimulating economic development and strengthening the communities in which we do business. We look to develop long lasting relationships with partners who are visionaries and whose creativity, ethical business practices and entrepreneurial spirit will keep Morgan Stanley at the forefront of the financial services industry.
Morgan Stanley is very active in the supplier diversity community. The Firm's program began in 1998 and the dollars spent with minority -and women-owned businesses has consistently grown every year. The program has been successful at including minority -and women-owned businesses in the RFP and contracting processes for the Firm. The Supplier Diversity Director meets with various purchasing officers to review upcoming opportunities and has initiated the 2nd Tier effort, which encourages the Firm's primary vendors to contract with other diverse vendors. Morgan Stanley is an active member of the National Minority Supplier Development Council, The New York/New Jersey Minority Purchasing Council, The National Minority Business Council, The Women's Business Enterprise National Council, The Women President's Educational Organization, The US Pan Asian Chamber of Commerce and The United States Hispanic Chamber of Commerce.
To learn more about becoming a Morgan Stanley supplier, please visit: www.morganstanley.com/about/diversity/supplier.htm
Did You Know?
The Billion Dollar Roundtable today consists of 12 corporations than spend $1 billion or more with MWBEs, plus co-founding organization Minority Business News. The BDR was founded in 2000.
In 2002 Billion Dollar Roundtable members collectively purchased more than $19.6 billion from minority and women-owned enterprises
PITNEY BOWES INC.
Pitney Bowes has been on the forefront of diversity best practices for year sand has in place strong measurement techniques to evaluate diversity success. The metrics are reported directly to company Chairman and CEO Michael J. Critelli and are used to determine management incentive compensation, Pitney Bowes employees, suppliers and community partners have a certain expectation of how the company conducts business. "Diversity is a business imperative that sustains profitability, and provides a competitive advantage. Our Company's growth and successful transformation are directly tied to a culture that welcomes different ideas and approaches." Critelll said.
For more than forty Years, Pitney Bowes has been committed to providing opportunities to minority and women-owned businesses (MWBE's). In 1997, the Business Diversity Development department was formed to create and implement programs to increase procurement opportunities with MWBE's. Since that time, MWBE procurement has risen 34.5 percent. This increase is due in hart to an online database (www.Div2000.com/PitneyBowes) where MWBE's can register their capabilities and provide decision-makers at Pitney Bowes with quick and easy access to companies that match their needs.
Pitney Bowes' efforts have been recognized by a number of organizations and publications. Hispanic Magazine named the company to its "Top 25 Supplier Diversity Programs" for the past seven years, The company received Dialogue on Diversity's Corporate Excellence Award for promoting the growth of business enterprise among women and, earlier this year, Pitney Bowes was ranked Number One on DiversityInc.com's "Top 50 Companies for Diversity."
Pitney Bowes is a $4.6 billion company that helps organizations of all sizes reduce the costs, increase the impact, and enhance the efficiency of communicating through mail and documents. The company calls that "engineering the flow" of communication and it has an 80-plus year tradition of technological leadership that has produced major innovations in the mailing industry and more than 3,500 active patents with applications in a variety of markets. More information on the company is available at www.pb.com.
Did You Know?
From 1992 to 1997, African-American-owned business grew by 26 percent.
--U.S. Chamber of Commerce
|Printer friendly Cite/link Email Feedback|
|Title Annotation:||Special Advertising Section|
|Date:||Nov 1, 2004|
|Previous Article:||A driving attraction: if you truly love cars, then these are the events you don't want to miss.|
|Next Article:||Rising to the top: Donald Riley doesn't allow physical limitations to stop his aspirations.|