Billion Dollar Roundtable

Characteristics that Shape Member's Supplier Diversity Initiatives

  • Close integration with sourcing organization
  • Partnership with Advocacy Groups
  • Annual objectives coupled with quarterly reports
  • Mentoring
  • Supplier information sessions
  • Increasing support of Tier 1 suppliers in Tier 2 purchasing activities through focused relationship-building activities
  • Expanding reach of performance metrics to increase accountability among team members
  • Opportunity exchange, a valuable forum delivering business opportunities to MBEs
  • Introduction of Supplier Diversity Champions throughout the organization
  • The employment of a consultant in the early stages of program development
  • Executive leadership support and involvement – the CEO is very  supportive and vocal about the program
  • The employment of a 3rd party I/T company to accurately identify our true minority spend
  • Internal awareness programs
  • Company wide implementation of NMSDC Supplier Diversity Best Practices
  • Enhanced accountability tools/metrics
  • In Tech Services, which is our largest area of spend, all Tier 1 contracts have a 25% diverse supplier utilization clause.  Even small business suppliers which are generally exempt, have a 15% diverse supplier utilization clause.
  • Requiring all large prime suppliers to become national members of NMSDC and WBENC to ensure the Tier 1 suppliers we do business with foster the same beliefs as we do
  • Utilization of corporate policy to drive supplier diversity
  • Establishment of supplier diversity within global purchasing
  • Appropriate allocation of headcount and funding for operating purposes
  • Accountability for achieving year over year supplier diversity objectives at all levels of the purchasing organization
  • Frequent review of supplier diversity performance against objectives
  • Canadian Aboriginal Minority Supplier Council member
  • Minority Entrepreneur Initiative
  • Senior management leadership involvement

Challenges facing the Supplier Diversity Program:

  • Government adoption of multi-tier reporting process
  • Increased emphasis on service disabled veterans
  • Industry (automotive) conditions placing financial stress on supply chain
  • identifying and/or developing M/WBEs in non traditional areas
  • Identifying smaller opportunities to introduce suppliers that are not yet at capacity for larger projects
  •  Identification of minority suppliers in the electrical commodity
  • Identification of WBEs with automotive capabilities that match potential opportunities
  • Supplier consolidation related to company merger and strategic sourcing reduces supplier base
  • Prime supplier reliance on contract manufacturing and other forms of outsourcing impacts second tier
  • Internal Education
  • Pressures to consolidate suppliers to cut costs in sluggish economy
  • Buyer’s challenge to grow their direct import spend
  • Large number of supplier inquiries versus our capacity to handle them adequately internally
  • Customer enforcement of their second tier requirements
  • Developing US suppliers quick enough to participate in our low cost country sourcing strategies
  • Consolidation of the supply chain and impacts of telecom and I/T manufacturers outsourcing and off shoring
  • Intense competitive pressures to continually lower costs is most challenging for smaller companies
  • Expansion of Second Tier program
  • Expansion of Supplier Diversity Program in the non-US Region
  • Sourcing requirements and decision making authority moving outside the US
  • Company rightsizing impacting resources available for supplier diversity operation
  • Globalization, consolidation, and rationalization of supply chain reducing opportunities for MBEs that lack scale, are in commodities with high labor content, and have not developed an offshore presence
  • No visible succession plans or exit strategies for founders of first generation MBE suppliers
  • Enhancing MBE stature in the value chain
  • Connecting opportunities for traditional MBEs with opportunities outside of the industry group
  • Global sourcing

Procurement Data

Key statistics for the incumbent members include:

The Member corporations range in size from $379 Billion on the high end to $42 Billion on the low end.

On a consolidated basis, the 15 corporations represent:

Industries range from automotive to telecommunications, aviation, information technology, consumer products, and to general merchandise retail.

Combined Tier 1 purchases from diverse suppliers totaled $35.2 Billion, up 18.5% from $29.7B. in 2006.

The average Tier 1 spend is 9.8%, up from 7% last year.

The 15 member corporations generated a combined $9.7 Billion in second tier spend.