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Supplier Diversity

At IBM, supplier diversity is a business imperative

IBM's supplier diversity program goes back to '68. "We offer the opportunity. It's up to them to step up and make it happen," says the program director

 

Michael Robinson sets the strategic direction of IBM's supplier diversity.

Michael Robinson sets the strategic direction of IBM's supplier diversity.

Michael Robinson is program director of the global supplier diversity program at IBM (Armonk, NY). "I have the responsibility for setting the strategic direction of the program," he explains. "Supplier diversity people report to me from Canada, Europe, Latin America and the Asia/Pacific area. Then I work with our procurement organization to determine our targets and report to senior management on how we're doing."

How are they doing? "Great!" says Robinson. "We feel that building and maintaining a community of diverse suppliers increases our opportunity to hear new ideas, apply different approaches and gain access to additional solutions and responses to our customer needs."

Furthermore, he adds, buying from diverse suppliers helps them grow and, in turn, increases their ability to use IBM products. "Our suppliers are also our customers."

Ingrained in the culture
IBM's positive history of workforce diversity goes back almost a hundred years, "and supplier diversity is also ingrained in our culture," Robinson notes. "Supplier diversity is not a social program, it's a business imperative. We recognize that a diverse supplier base is integral to the company's profitability, our objectives and our strategic imperatives."

The company's formal recognition of supplier diversity as a business initiative began in 1968. Judging by the number of awards it has won over the years, including the 2005 NSMDC Corporation of the Year, it's still going strong.

Ensuring opportunity
One of the main duties of Robinson and his group is, of course, "to ensure that we're giving opportunities to diverse businesses," he says. For example, every RFP that goes out from the procurement department must have at least one qualified diverse supplier on the list. "It's an absolute requirement and our internal auditing team checks it out," Robinson notes.

His group works with NMSDC, WBENC and the SBA to identify diverse suppliers in many industries "so we can be sure we have qualified diverse suppliers on the list," he adds.

IBM also insists that both its tier 1 and tier 2 suppliers must utilize diverse suppliers of their own. "And if they can't find qualified people, my team will help them," Robinson notes firmly.

Come to the town meeting
Four times a year Robinson's group puts on a town meeting. "We pick a city and invite suppliers suggested by the local affiliates of both WBENC and NMSDC," he says.

"We proceed to educate them on how to work with and understand IBM and other customers and prospects. We want them to know that we will provide the opportunity, and it's up to them to step up to the plate and make it happen."

A new look at mentoring
Robinson has been with IBM for almost twenty-three years, but just over a year in his supplier diversity position. One of the first things he got into when he took the new job was the supplier mentoring program.

Some companies, he says, just pay lip service to mentoring. "Somebody at the company calls the supplier once in a while and says, 'How's everything going?", and that's the program."

Last year Robinson brought in one of IBM's own consultants who had an excellent track record, including a mentoring program created for the U.S. government to use with Native American suppliers. "We asked him to draft up something specifically for us," Robinson says. The result was a program pairing IBM executive mentors with several top people at the supplier company.

"We began the program with a kickoff retreat," Robinson recalls. "We brought in not just the presidents or CEOs of the diverse suppliers, but several of their chief officers and decision-makers. We believe that to mentor a supplier effectively you have to understand the company, so we're mentoring its entire executive branch."

After the initial retreat the participants come together at least once a quarter, often once a month. "We want to supply assistance that will make the diverse business a better company not only dealing with IBM but other Fortune 100 companies as well."

An interesting aspect of the program is that the enrolled firms don't have to be IBM suppliers. Most of them, of course, are. But there are also non-IBM groups "that we've met, had discussions with and feel that we can provide some assistance to.

"We keep our eyes open for likely candidates," Robinson adds.

SpringBoard: a two-way street
SpringBoard CEO Tony Dolphin, second from left, with high-level managers.

SpringBoard CEO Tony Dolphin, second from left, with
high-level managers. (Courtesy of Minority Business News USA)

"When you work with diverse suppliers it's always a two-way street," says Robinson. Case in point is SpringBoard Technology (Springfield, MA), an IBM tier 1, and its African American founder and CEO Anthony Dolphin. "Tony has brought us ideas, and we've helped him make his company better from the standpoint of working with IBM and other companies as well."

SpringBoard Technology has an interesting history. Dolphin, who got a BSEE from Roger Williams College (Bristol, RI) at night and has other engineering and management programs under his belt, had worked for Raytheon in hands-on engineering, manufacturing and management roles. He left after fifteen years to manage a Digital Equipment Corp manufacturing and service organization in Springfield, MA.

Nine years later Digital decided to close that manufacturing operation. Dolphin put together a proposal that resulted in a leveraged buyout of a major portion of Digital's Springfield-based storage technology business.

Technology transfer
Digital wanted to move on to its next generation of products, but needed to support its installed base in the field. SpringBoard took over that share of the business. What he was doing, Dolphin explains, was "end-of-life manufacturing" and in-warranty and out-of-warranty management.

"Digital Equipment Corporation was our first and only customer for about a year, and then we succeeded with several major OEMs," including Seagate Technology, Dolphin relates. "Bringing Seagate into our customer base got us exposed to IBM. Seagate was supporting IBM directly, and when Seagate outsourced several storage technology product lines to SpringBoard, IBM became one of our customers."

The original Seagate outsourcing programs required a couple of major Asian Pacific technology transfers, Dolphin says. "We sent a group of SpringBoard employees to the factory in Singapore, brought the mature product lines back here to Springfield and began to support them from there."

IBM, Dolphin says, appreciated SpringBoard's understanding of the technology, good business sense and good performance. "They began to seek out other ways that they thought they could do business with us."

A new business model
In an unofficial mentor/protégé relationship, IBM selected SpringBoard to test a new business model called "direct-ship." As Dolphin explains it, "Ultimately IBM outsourced to us not only purchasing but inventory management and warehousing distribution of desktop peripherals.

"Field returns are directly shipped to us, too. Better than half our hundred-person employment base are technicians, which means we actually do the physical repair. We manage all the order fulfillment process directly with IBM's field engineers." Because they did so well, he says, "IBM has expanded our role to include printers. That has become one of our core competencies, all due to our IBM partnership."

IBM measures SpringBoard's performance, "and we're very proud of that measure because we are very consistently in the 99 percent level of service," Dolphin notes.

The direct-ship business model caught on with IBM and many other large companies. SpringBoard now does similar work for HP, NCR, Kodak, EMC and others.

"We support some customers on a global basis but we do it out of Springfield," Dolphin explains. Now, however, "We are considering extending ourselves into the Latin American market," he says. "That's extremely exciting to us."

A protégé at last
SpringBoard has worked with IBM more than ten years. "They've now enlisted us in their formal mentor/protégé program, and we're very pleased and honored to be part of it," Dolphin says.

"We have the benefit of Ken Johnson, a senior person in their procurement organization as our IBM mentor. He is working with the SpringBoard senior management team on business development initiatives with IBM and other customers."

Recently Dolphin and two of his senior managers were invited to a strategic planning seminar facilitated by a faculty member from the Tuck School of Business at Dartmouth College (Hanover, NH). "Other suppliers were there as well and it was just a tremendous forum," Dolphin says. "We had a chance to exchange ideas and listen to other businesses and discuss their issues and challenges. That helped us better understand ourselves."

Certifications
SpringBoard has a number of worthwhile industry certifications. "They surely open doors for us and give us an opportunity to meet new companies and suppliers, and we're proud that we're very active members," Dolphin says.

SpringBoard was an ISO registered company almost from the start. It's a certified supplier with the New England Minority Supplier Development Council (NEMSDC), the regional wing of NMSDC. Dolphin has been on the board of the New England group, and he's actively involved with its minority business enterprise input committee.

Dolphin's company is also certified to do business with the state of Massachusetts, although "We haven't really explored that market yet," he says. "So far we haven't targeted government markets at all, but we're doing some research in the area."

MBE to MBE
Another source of pride: In two of the past three years, SpringBoard Technology was awarded top acknowledgement by NEMSDC for MBE to MBE spending.

"IBM now measures that too, but we were doing it long before they started," Dolphin declares.

SpringBoard takes a great interest in the community, in some cases joined by its customers and major business partners. Youth is one focus: the company is the co-founder of the Black Business Showcase at a local youth center and is also active in the public school system. The hundred-employee company takes on several interns from the public school system.

SpringBoard is also involved in community outreach to local youth, and in regional economic development initiatives. Senior members of the management team sit on boards that include Associated Industries of Massachusetts, the New England Council and the board of trustees for Western New England College.

"The values that IBM has created are many of the same values that we embrace at SpringBoard Technology," Dolphin says. "That's one of the reasons this partnership has flourished."

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