The proverbial "win-win" scenario can be an elusive goal in the business world, where, competition being what it is, someone's gain is someone else's loss.
But that's not true in the world of supply chains. These networks of interdependent companies are becoming both more complex and more pervasive--it's not uncommon for even the smallest of start-ups to forge critical supply-chain partnerships with other firms from Day One.
As they do, many are following the lead of large, long-established companies by ensuring that their supply chain networks are as diverse as possible. Simply put, that means looking for companies (typically, small companies) owned by veterans, women, people with disabilities, or others who have historically been underrepresented in the world of suppliers. It can also include efforts to tap suppliers who are based in economically disadvantaged regions of the country.
Why bother? Aside from the obvious answer--that it provides economic opportunities and growth to the suppliers and the regions they operate within--the advantages that flow the other way are substantial.
"We value and leverage the agility, ingenuity and new perspectives we gain when partnering with small businesses to help us solve a wide variety of challenges and drive affordability into our products, which is a priority for us," says Susannah Raheb, Supplier Diversity Leader for Lockheed Martin Corporation.
Simply put, she adds, "If there is a more efficient way to do something, we want to know about it. Having a diverse supplier network is one way we leverage a broad spectrum of expertise."
In fact, Lockheed Martin is so keen to create as diverse a supplier network as possible that it maintained a presence at more than 150 conferences last year.
That level of due diligence reflects Lockheed Martin's commitment to supplier diversity, a commitment reflected in the nearly $1 billion in contracts it awarded to both SDBs (small disadvantaged businesses) and women-owned small firms last year. Meanwhile, veteran-owned small firms secured more than $800 million in Lockheed Martin supply contracts.
As a global manufacturer of aircraft and other complex equipment, not to mention a comprehensive portfolio of IT and related services, Lockheed Martin's supplier needs are vast. And, as a "Defense Prime Contractor" it is required to award some portion of its contracts to disadvantaged companies. But the lessons it has learned in building up a diverse supplier base apply to many companies. "Our engineers and technologists appreciate the many efforts we make to connect with all kinds of suppliers," Raheb says. "The ingenuity that these firms bring to us is invaluable. And if we aren't a great fit for a supplier at the moment, we work hard to connect them with other companies that might be. Everyone wins when you have a strong industrial base."
Companies have focused on creating a diverse workforce and, more recently, diverse boards of directors. Creating a diverse supplier network is the next logical step, and there is no reason to wait to take it.
The Other Side of the Equation
Here are several critical steps to help you pursue new business opportunities.
1. To be a small business and qualify for specific socio-economic categories, you must adhere to industry size standards established by the U.S. Small Business Administration. MBE and other forms of certification for commercial contract opportunities assure potential clients that your company can deliver quality goods and services reliably.
2. Get educated. Review company web sites, read industry news journals and attend seminars such as those sponsored by Lockheed Martin, to learn how to make your best case to the companies most likely to be a good fit for what you have to offer.
3. Get out there. Armed with the education cited above, reach out to the appropriate people at potential client sites. Be patient. Often a company that doesn't need you today will need you tomorrow, or will know another firm that does. Think in term of long-term relationships, not quick wins.