Aiming in a new direction.

• Author: Clarke, Kenton
• Position: Business & Finance - On supplier diversity

IN THE PIECE "Spend Doesn't Matter," I highlighted the matrix-driven goals followed by most corporations for their supplier diversity initiatives. For those unfamiliar with the term, supplier diversity is a business program amongst Fortune 1000 companies that encourages the use of privately-held firms owned by historically underutilized businesses when purchasing goods and services. The fundamental goal is to include businesses owned by diverse people in the supply chain of Fortune 1000 companies to build wealth within those communities. My objective is to create a paradigm shift to ensure that small businesses are the primary focus of that process.

Over the course of the past 10 years, I am happy to report that Fortune 1000 companies consistently have fulfilled their benchmark in increasing spending with diverse owned businesses and continue to do so. However, with more than $100,000,000,000 purchased from diverse owned companies, we only can point to a handful of business owners who have fulfilled the American Dream. This madness to achieve higher spending has had little impact on employment and economic opportunities in the nation's underserved communities. There still is a lot to do.

Supplier Diversity has the unique ability to build prosperity not only with the special few, but to be true to the word diversity and focus spending on organizations that not only have diverse leadership, but diverse annual revenues.

Another year of data collection from more than 1,000,000 small businesses reveals an even wider gap between supplier diversity goals and objectives and wealth creation in companies owned by diverse peoples. The billions of dollars of new business opportunities created by large corporations somehow still cycles back and remains in the hands of majority-owned companies. The creation of Strategic Partnerships, where a large majority owned company and a diverse owned enterprise combine to win contracts, still flows the green back to the same old boys. These transactions inflate diverse spending and create the illusion of progress and new economic development.

The identification of the low-hanging fruit (products and services offered by diverse owned companies) has become obvious to large procurement organizations. Much work has been done to move large contract dollars for information technology services, staffing, etc. to diverse owned films with proven track records and exceptional delivery history. This sector of commodities has...