FirstEnergy (Akron, OH) is a Fortune 500 diversified energy company. It's taken shape over the last decade in two mergers. Chad Heyman, supply chain senior business analyst, says the mergers created an opportunity to combine the best supplier diversity practices of each legacy company. "When you merge companies, the challenge is always to merge cultures," Heyman says. "You have to take the best and go forward from there, and we did that twice. Our current program is a combination of the best of the three legacy programs."
Heyman himself is from one of the acquired companies. During the merger process he moved from a sales position to the supply chain organization where FirstEnergy's supplier diversity programs are housed. Supplier diversity professionals, he reflects, often have a procurement background, "but I think my sales background gives me a different and valuable perspective." He took on his current job about five years ago.
Six business classifications
Heyman notes that FirstEnergy, as a government contractor, works closely with the U.S. General Services Administration (GSA) and Small Business Administration (SBA). "We are considered a prime contractor to the federal government since we supply electricity and other services to post offices and other federal facilities. That means we are required to have an active supplier diversity program and report on it to the GSA on an annual basis."
On the state level, FirstEnergy interacts with public utilities commissions. Most of its operations are in Ohio, New Jersey and Pennsylvania, and all three state commissions require supplier diversity programs and annual reporting. Heyman is diversity coordinator for FirstEnergy's Ohio companies and Toby Stanislaw, also a supply chain senior business analyst, handles the Pennsylvania and New Jersey companies.
FirstEnergy, Heyman explains, tracks and reports six business classifications: small business, MBE, WBE, HUBZone, veteran-owned and service-disabled veteran-owned businesses. "Our supplier diversity program is very inclusive and benefits almost everyone," he says. "We've made some pretty great strides in that regard."
Certifications and affiliations
Would-be suppliers to FirstEnergy register via www.firstenergycorp.com, and must be certified. "The purpose is to ensure that the potential supplier is at least 51 percent owned and operated by a recognized diverse business owner, or meets the criteria for a HUBZone business," Heyman explains. "For vets and small businesses we allow some self-certifying, following SBA guidelines."
For minorities and women, FirstEnergy requires NMSDC and WBENC certifications, working with the Northern Ohio Minority Business Council (NOMBC), the NMSDC of PA-NJ-DE, and regional WBENC affiliates.
The company is an active supporter of regional and national supplier diversity organizations. Heyman is first vice chair of the NOMBC and will be chair next year. He's also president of "Gaining access through economics," a supplier diversity program sponsored by the Public Utilities Commission of Ohio. Stanislaw is president of the NJ Board of Public Utilities' supplier development council, a member of the certifying committee of the NMSDC of PA-NH-DE, and co-chair of regional WBENC affiliate.
"There are several benefits to FirstEnergy's involvement in these business groups," Heyman explains. "We want to give back to our customers and strengthen local economies. Beyond that, we feel we meet the cream of the crop of M/WBEs in these groups. And we can network with other corporate members and benchmark our programs against their best practices."
Addressing the marketing issue
Marketing, says Heyman, "has been an issue with smaller M/WBEs. They want to do business with big corporations but they don't really know how. They're good at what they do but they're not always good at marketing themselves.
"I recently had a conversation with a small-business owner who doesn't use Microsoft Word or even e-mail," Heyman discloses. "We try to help all potential suppliers understand the basic business tools they need for us to consider doing business with them."
To help the startups, Heyman has developed some elementary training based on his own sales background. "Of all the things I've ever done in my career, I think I've had most positive feedback on this one," he says.
He's developed a series of three sessions: how to market your business, how to do business with corporations, and how to sustain growth. He presents them at meetings of groups throughout FirstEnergy's service territory. "I've probably done them at least thirty times for different groups," he says.
For the fifth year in a row, he'll do a session at the Northern Ohio Veterans Business Symposium. Last year, he notes, the vets were so pleased with his work that they inducted him into their hall of fame. "It was totally unexpected and very gratifying," he recalls.
Doing business with Coleman Spohn
Lonnie Coleman is president, CEO and owner of MBE Coleman Spohn Corp (Cleveland, OH), a mechanical contracting company with an exceptional reputation in the region. The company does HVAC on a large commercial scale, and also installs process piping in power plants.
Developing the company
The original Spohn Corp was formed in 1911, "a worthy old-line company," says Coleman. But as companies sometimes do, Spohn found itself in financial trouble. ColeJon Mechanical Corp, which Coleman and a partner started in 1976, "bought Spohn's assets in 1994, took the name, and started to rebuild the business.
"It turned out to be a pretty good situation for us," Coleman says. "We were able to revive something that was very old, add something that was very new, and capitalize on the private and public opportunities that were available."
When ColeJon started in 1976 "There was virtually no support for MBEs," Coleman recalls. "The federal government had its 8(a) program and that was all. We knew rebuilding Spohn was something we were capable of doing, and it was up to us to make a success of it."
Coleman himself "came through as a pipefitters' apprentice. In 1969 I came home from Kent State University (Kent, OH) searching for a summer job. I started in the pipefitters' apprenticeship program and ended up in the pipefitters' union as a building trades journeyman."
Coleman decided that the intricacies of pipefitting beat out the history he had been studying in college. He stayed on through the five-year apprenticeship and worked two years as a journeyman. Then he and a colleague, who was working in sheet metal, decided to start a business for themselves.
Getting a break
ColeJon Corp "struggled in the beginning as most small businesses do, but we got a foothold and learned. We were a union contractor, and in our first nine months we did $56,000 in sales with just the two of us working," Coleman reflects with pride.
"We knew we could get the work and do the work. All we lacked was management experience. But other companies were good to us. They took us under their wings and showed us how to estimate, purchase, coordinate and run a project. It was a learning experience for us because we came out of the trades."
In 1981 they got a real break. "We took over a small maintenance contract for a contractor who had gone bankrupt and that catapulted us into another world!"
The partners ended up growing ColeJon from its modest start to $40 million in sales and 750 employees. "Then we came upon the Spohn Corp and purchased its assets."
In 1997 Coleman and his partner split up, and he retained Coleman Spohn. Today Coleman Spohn Corp does about $23 million a year and has more than 100 employees. "It's a different environment," Coleman says. "We have our HQ in Cleveland and an office in Toledo, OH where we do systems integration and commissioning work for buildings."
Coleman Spohn's concentration is on mechanical contracting, and all its sales are in the mechanical contracting environment, Coleman explains.
The Presidents' Council
ColeJon had done some small jobs for FirstEnergy, but the association between the two companies got a big boost from the Cleveland Presidents' Council.
The council was originally launched by Brian Hall, Coleman and other African American CEOs interested in economic development and job creation in the black community, and also with the aim of "asserting an African American voice on business issues within the overall community."
The council started small about nine years ago, and today it's made up of sixteen Cleveland-area MBEs. "We've been able to bring in CEOs of major corporations in the region to participate as associate partners, and it's worked out well," Coleman notes.
"We now have a Presidents' Council Foundation working with emerging African American entrepreneurs to help them in their development and growth." So far there are about forty graduates of the program, working in construction, IT, transportation and other disciplines.
"We're also partnering our Presidents Council companies with our regional associates." Richard Grigg, FirstEnergy's EVP and COO, is Coleman Spohn's mentor.
Building relationships
"It's an opportunity to build relationships with big regional companies," Coleman says. "The Presidents' Council associates give us access to the people in their organizations. I can line up my CFO with an associate company's CFO if I have accounting issues I need to discuss. I can line up our purchasing people with their purchasing people.
"FirstEnergy helps our business development and growth. On the other side of the coin we help them meet their diversity goals and introduce them to other MBEs and WBEs that can work in FirstEnergy organizations."
Coleman Spohn has been able to add several projects for FirstEnergy: work in the utility's fossil fuel plants and a research facility.
"One of the toughest obstacles for a small MBE is gaining access to major businesses. But once the doors open up, as they have for us, a great many things can happen. We have a working relationship with FirstEnergy and it has worked out really, really well," Coleman says with pleasure.
Going regional
Coleman Spohn is certified with a number of organizations. "NMSDC is the certification that can accommodate us as we expand out of our local area into a more regional-based company," Coleman says.
That's also an important facet of his company's relationship with FirstEnergy. "They have a three-state footprint. If we show the capability and capacity to take on the work, they can help us move to other areas of the region to work in their facilities."
Coleman Spohn is a member of NOMBC, the local chapter of NMSDC. "There are a number of NOMBC corporations we do business with. We participate in as many of their trade fairs as we can. It's another opportunity to open new doors."
Coleman himself is active with the economic empowerment and inclusion taskforce of the Greater Cleveland Partnership, created by the Cleveland Chamber of Commerce to improve growth of and investment in minority businesses.
Creating opportunities
"We're probably the most diverse mechanical contracting company east of the Mississippi," Coleman declares. "We hire across all ethnic and gender lines. We have many women in nontraditional roles in our organization: women pipefitters, plumbers, estimators and project managers.
"There are no glass ceilings; you can go as far as your ability allows. We're probably more willing than many to open the doors and create opportunities for those who have been underserved in our community.
"No matter how big you grow as an organization, mentoring is constant. There's always an opportunity to learn something new and dynamic. Any time we get the opportunity to be mentored we take it. And if we see a chance to help someone else who's coming along, we try to do that. Our doors are always open to help out where we can," Coleman concludes.
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