ask the white guy
WHAT WOULD MAKE WHITE PEOPLE
SUPPORT A BLACK BUSINESS?
QWHAT WOULD MAKE WHITE PEOPLE SUPPORT
A BLACK BUSINESS OVER A WHITE BUSINESS,
ALL THINGS BEING EQUAL?
aI’ll assume that your question involves a hypothetical company, one that is average and,
therefore, does not have a robust supplier-diversity
program. I’ll also make the assumption that the
procurement-department head and/or CEO is white.
With all things being equal, and with the above
circumstances, there are several reasons for a white
businessperson to decide to do business with a black-owned business over a white-owned business.
It’s called “supplier diversity.” It’s not charity. It is
a process by which companies improve their business.
Properly implemented, supplier diversity lowers costs
and increases margin and/or revenue.
THERE ARE SEVERAL WAYS THIS HAPPENS:
● If you increase the number of suppliers with which
you’re doing business, you will lower overall procurement costs.
● Women/minority business enterprises (W/MBEs)
are forming and growing at a much faster rate than
business in general. Aligning your business with a
growth sector is a good strategy.
● If your company is a consumer company, supplier
diversity will help your company brand new consumers (your suppliers and their employees). In the
process of doing business, your company will learn
the skills necessary to better form relationships with
people of color and/or women.
● If your company is a business-to-business company,
you probably already know that other progressive
businesses are asking for supplier-diversity numbers
on requests for proposals. You are at a competitive
disadvantage if you do not have a good record to show.
● If your company is a business-to-government
company, you already know that supplier diversity is a
mandate. But beyond mandates is intent. Progressive
governmental agencies (they’re not all the same) are
looking for exceptional performance. The late Dave
Sampson at Marriott told us of three $1-billion con-
tracts they won from three different city governments
on the basis of superior supplier diversity.
● Supplier diversity is a sound business practice,
especially practiced by companies that outperform the
general stock-market indexes. The 2007 DiversityInc
Top 50 Companies for Diversity® averaged 9. 3
percent of their procurement spend with W/MBEs;
we estimate the national spend at 2 percent. The Top
50 companies, expressed as a stock index, outperform
the Nasdaq, Dow Jones Industrial Average and the
S&P 500 on a long- and short-term basis.
Ultimately, we must all realize that we are
visually oriented tribal beings; diversity management—in this case, supplier diversity—isn’t going to
come “naturally.” What comes naturally is to do business with people who look just like we do. Diversity
management is like managing any other business
discipline: Expectations must be
clear, accountability must be absolute and vigorous
metrics must be
utilized.
In the most popular area of
DiversityInc.com, Luke Visconti
offers readers the opportunity to
confidentially ask questions regarding
diversity. You can find all questions and
answers at www.DiversityInc.com/A TWG.
Luke is one of two business partners who
own and run DiversityInc. He directs all
editorial and circulation functions.
