Background

Since the 1960’s, numerous supplier inclusion programs and strategies have been introduced toward building parity among non-minority enterprises. Our current depressed and somewhat untrustworthy economic situation is overtly appealing that more buying organizations consider solutions for capacity building among African American firms. Seeing that, historical statistics disclose that whenever products and services are strongly considered from this viable business sector an economic boom ensues for both public and private sectors.

Why? Because building real economic parity requires complete stakeholder involvement and it has become a dying frontier for supplier development and ethical outsourcing. However, by employing this veiled buying strategy it will serve as the best practice toward remedying this era of economic adversity.

To start with, most common are analytical statistics of annual spend reported by major public and private sector organizations showing African American-owned firms basically last, in both the number of purchasing contracts and bid dollars awarded. Particularly in California, as executive management unreasonably plan their make-buy decisions of material resources without accounting for all viable enterprises.

A strong disparity between classified groups have distanced themselves apart from American Americans, particularly Caucasian women, Asian, and Latin-owned firms. The most widespread excuse or reason given for limited African American enterprise inclusion is two-fold; (1) Contracts are too large to assign contracting responsibility to lesser known suppliers. Large purchasing contracts are designed to take advantage of economies of scale practices; however, such contract bundling leaves limited room for flexibility and product change to more efficiency. (2) There is a limited pool of qualified African American firms to choose from, thus the competitive bidding lacks their participation.

Notwithstanding, it is important to fulfill the public and private sector’s operational product and service requirements through African American suppliers and the other categorized firms routinely omitted in the deal making process. In a climate of capitalistic chaos on Wall Street, implementing broad base choices on enterprise activity serves as an economic stimulus package needed for California.

Economic stimulus exists through current buying channels when procurement management personnel are given latitude and direction to move from aggregated purchasing constraints to open market based acquisitions. African American-owned concerns, principally those operating in regions with high unemployment statistics should receive first consideration. Such communities with low job markets negatively impact a polarized division due to diminished economic empowerment and political influence.

When these firms are expanded with long term contracts, the prosperity of the State of California benefits as such firms better ensure a more complete economic development, stimulated by expanded revenues and job creation. Plus, these firms are better retained as a source of tax revenue at a time where many non-retail based companies seek better state offerings for conducting business.

Offering greater African American business supplier inclusion eliminates a too often occurring pitfall with public and private sector outsourcing programs. Strategic make/buy decisions cannot focus merely on the cost, quality, and time implications of the decision. Social and economic conditions are crucial with corporate expansion and continuous improvement processes.

Market Research

Through seeking sources of supplier talent pool resources, buying professionals must encourage current and next generation African American-owned businesses to pursue open bid opportunities offered by their respective organization. Open advertisement and membership with all California based Chambers of Commerce is a direct and reasonably sufficient means of African American supplier recruitment. An adjunct is to subscribe to business trade associations in the identification of firms. Employing a consistent invitation to such groups is a fair and equitable manner in which to attract qualified African American firms interested in pursuing contracting opportunities.

Through heightened networking, African American suppliers can be referred from other major buying entities that use similar supplies and services. All procurement management personnel should practice sharing its qualified suppliers with other major public and private organizations to generate a state and national economic stimulus.

Supplier Courtship

Once contact is made, a review process must be immediate and complete. There should be clear analysis of African American owned business to determine their reasonable abilities and capacities to deliver of potential contracting.

Whenever possible, African American owned businesses should be coached and encouraged to pursue contracting since such activity can be quite arduous at the beginning. Where capacity building is deemed necessary, procurement management personnel should make time to direct principals on how to improve noted business gaps for expanding resources to meet future opportunities.

All procurement management personnel should have a liaison that works with the US Small business Administration to ascertain data of certified 8(a) contractors for potential African American supply firms. Regularly e-mail information on purchasing opportunities, or send US Mail post cards on purchasing opportunities, or share successful supplier engagement stories on Internet channels. Always extend and encourage all viable suppliers to attend major public and private organization’s sponsored business courses and job walks.

Management Leadership Integration

All purchasing management personnel have to be equipped to understand the importance of total economic development. Basically, a no business left behind philosophy must be employed to ensure supplier integration. Indispensable leadership is paramount among procurement and those that influence the make/buy decisions of procurement management personnel.

Supplier integration for African American owned business concerns essentially ends here without internal support. All channels of communication must remain active in order for the new supplier to receive the encouragement from end-users. Procurement management personnel have to take an active interest in the service territories to pursue business engagement opportunities at all levels

Economic development requires constant oversight of annual operational products and service requirements in order to effectively build an appreciative level of understating on why business is a driver for economic development and community viability. Thereby, establishing a statewide oversight committee will accomplish greater accountability of economic stimulation through ethical purchasing standards.

Corporate Operational Integration

Employing a bidder’s clearinghouse remains an important service for public sector procurement. It is a tool for managing the ebb and flow of bid activity that will enable a closer look at how to engage African American suppliers. In addition, this is the activity to demonstrate a stronger business recruitment strategy, where public supplier engagement can better record and report internally and externally supplier engagement success stories.

The success stories help attract and encourage other African American business to pursue contracting opportunities. A key feature of the success stories is that they can be written in an Advertorial format describing the African American suppliers in terms of quality and performance and not by race or ethnicity of ownership. Such articles will highlight the progressive supply chain management skills of the buying entity and satisfy the discussion far from regulatory requirements and the right thing to do concepts so commonly shared.

Full Supply Chain Integration

Once the aforementioned general processes take effect, major buying organizations will have successfully leveraged all of its existing technologies and community development strategies for business inclusion. By evaluating and reporting on African American owned businesses, procurement professionals will be viewed as solution providers on economic development and expansion. The results will demonstrate positive examples of employing best-practices through technology and market research.

Rewarding purchasing management excellence has to come from the top executives, and buying agencies should annually recognize all sourcing teams for their diligence with African American supplier inclusion. Sourcing teams deserve to receive high praise to enhance their internal credibility as the best source for meeting operational requirements of the organization. The bid process for new firms will always bear scars, but through a complete debriefing, such firms will quickly add respect to the public and private sector’s sense of economic fairness.

To obtain and achieve full supply chain integration, all elements of internal and external stakeholders must be in complete alignment of expectations and outcomes. The supply chain participants build relationships with the new supplier and become corporate culturally deep-rooted in the process.

Conclusion

For as long as recorded history can account, how well we interact with one other is the ultimate measurement for effective standards of living. If any single individual or group appears neglected or misaligned through unexplainable actions then our job as humans has been discolored. The preceding discussion hinges on developing leadership in purchasing and supply chain management to affect a true balance of effective product/service prioritization in pursuit of socio-economic obedience.

American economic strengths have routinely be driven by inclusion of race and cultural, just as the civil war, reconstruction, prohibition, the great society, and civil rights. After the planning, scheduling, performance, quality, on-time delivery, legal requirements and problem solving is done, procurement professionals are truly evaluated by the extent of their ethical practice of supplier engagement. Therefore, to remedy the ever increasing challenges of effective contracting and advantages of African American supplier inclusion boils down to ethics.