Synergy drives the dollars in supplier diversity procurement. As minority businesses match their capabilities with the procurement needs of billion-dollar corporations, the playbook for a successful minority business enterprise (MBE) purchasing relationship is set.
HispanicBusiness spoke to supplier diversity executives at Dell Inc., Microsoft Corp. and IBM Corp. about the importance of collaboration and communication in forging links in the supplier diversity chain.
Maintaining relationships and participation with external organizations that support diverse businesses and their development is one of the key responsibilities of the supplier diversity organization, said Johnny Elias, IBM supplier diversity program manager.
IBM offers support in the form of direct financial grants, provision of equipment and technical support, participation in conventions and trade fairs, and the provision of labor by IBM executives and professionals, he added.
In It Together
Dell establishes its yearly supplier diversity goals based on historical performance and then strives to increase it by 5 percent each year, said Cyndi Hopkins, Dells director of global supplier diversity. In fiscal year 2012, Dell spent approximately $3 billion in procurement with MBEs, and is on track to beat that amount in 2013.
We have an annual target… that cascades down throughout the entire organization, Ms. Hopkins said. We dont look at our goal as a ceiling, (but as) a minimum that we want to accomplish in any given year.
Microsoft invests $1.5 billion in diversity spending annually, according Fernando Hernandez, director of Microsoft Supplier Diversity, Global Procurement Group. He said that when firms are first pitching he asks for a thumbnail sketch of the company or a one-page presentation so he can get a better idea of its offerings.
Landing a contract is really going to be about ideas, Mr. Hernandez said. If youre not great at transformative ideas, the technology is going to exist (cheaply) enough that you can quickly build prototypes and pilot it out.
He has more than 1,300 vendors or suppliers in Microsofts diversity supplier database, and is always adding more by attending stakeholder conferences and trade shows.
Dont get scared, get engaged is the message, he emphasized. And if youre willing to mentor, then step up. Were all in it together. We have to help each other.
The Chamber Connection
Hispanic chambers of commerce also play an integral role in supplier diversity. Rick Ortiz, president and CEO of the Greater Dallas Hispanic Chamber of Commerce (GDHCC), said a corporations commitment to supplier diversity brings new opportunities for all.
We see ourselves as that conduit – that ability to bring those two together, Mr. Ortiz said. The other part of it is, yes, they are putting aside this money, but are these businesses that are Hispanic- and minority-owned, are they able to do business with them?
A chamber can also supply the vital connection between an MBE and a large corporation. For example, the city of Dallas spends $800 billion annually in various purchases, and the chamber uses its members to provide services to the city.
We show (small businesses) what to do in order to do business with the city of Dallas, said Gabriela Quezada, vice president of economic development at the GDHCC.
As Dell, IBM and Microsoft demonstrate, the diversity supplier chain is increasingly interdependent. One contract leads to another and thats synergy.
Research by HispanTelligence.
Source: HispanicBusiness.com (c) 2013. All rights reserved.