The Home Depot works with
The goal is to get diverse suppliers more than just a contract. “We want to help them create a relationship with us,” says the supplier diversity chief
Michelle Sourie Johnson is director of supplier diversity at The Home Depot (HD, Atlanta, GA). An attorney by training, she started in merchandising eleven years ago and went on to run the company’s training and development organization.
In 2004 she moved into supply chain and formalized the supplier diversity program. “I’ve held several positions but they all complement each other well,” she says.
Of course there were diverse suppliers at Home Depot before Johnson formalized the program. “We had informal efforts by department,” she explains. “Then we became the first home improvement company to create a formal supplier diversity strategy.
“We made the decision in 2003 to be the first in the industry to do it and do it right!”
Benchmarking the effort
Nothing they did would be classed as rocket science, Johnson notes with a smile, but it was pretty good psychology. “One of our smartest moves,” she says, “was to recognize we didn’t know it all! We talked to our contemporaries who had been through it. We recognized that others already had the expertise we were seeking.
“So we selected about fifteen companies in various industries: banking, retail, aerospace and others. If we thought they had a great program we talked to them about it.”
Some of the benchmarking questions they asked: “What three things have you mastered; what three things do you wish you could do over, where would you start if you could begin again from the ground up?”
Every supplier is a customer
For The Home Depot, as for many retail establishments, every supplier is a potential customer. “We can’t say ‘yes’ to every supplier, but we want them to walk away feeling they’ve been treated with respect, and knowing we genuinely looked at their service.”
When the company set up its supplier application process, it was created by Supplier Gateway, a minority-owned business. “It took us nine months to establish the process and get everything set up, and in 2004 we started accepting applications.”
Supplier diversity at Home Depot has had a steady and consistent growth pattern since then. Each department now has the ability to access its spending and compare its goals with its actual numbers on a monthly basis. “I still consider us a newer program,” Johnson says, “so we must make sure the numbers are accurate.
“Our goal is to get our suppliers more than just a single contract. We want to help them create a relationship so as our business grows, their business grows.”
NMSDC and WBENC
The Georgia Minority Supplier Development Council (GMSDC), a regional arm of NMSDC, was one of the first groups Home Depot met with in its benchmarking efforts. “We were trying to understand the landscape and where to align our organization for the best fit,” Johnson says.
The relationship was fruitful; Johnson has twice been named GMSDC’s advocate of the year. “We are also national corporate members of WBENC and NMSDC; we attend conferences and events and I sit on the national board,” she adds.
Introduction to competitors
“As I learned more about the power of economic inclusion,” Johnson says, “I realized that a major purpose of supplier diversity is to help diverse businesses grow. Then I thought, ‘Why not introduce them to our corporate peers?’
“Our VPs selected some of the best diverse suppliers in their areas and asked them, ‘Who are your top three to five prospective corporate clients, corporations you are trying to engage?’ Our VPs wrote letters of reference on their behalf, recommending them.
“We’ve been doing this since 2005,” Johnson notes. “We usually tie in our top supplier recognition and referrals with the NMSDC or WBENC annual conferences.”
Business with Metasys
Metasys Technologies Inc (MTI, Atlanta, GA) works in workforce management, professional staffing, outsourcing solutions and IT consulting. It’s one of the excellent companies that came in through the HD supplier diversity program. Johnson met Sandeep Gauba, CEO of MTI, through the GMSDC and was greatly impressed with him.
“Sandeep is a case study in how to do things the right way,” she says. “He did not expect to get a contract overnight, but he had done his homework and he walked in and offered us a solution. We gave him a small piece of business to prove himself and he did, so he has grown his business with various HD areas over time.”
“Enthralled by business”
MTI CEO Sandeep Gauba has a 1984 bachelor of technology degree from the Indian Institute of Technology (Delhi, India) and his MBA from the University of Maryland-College Park. “Along with my technology background, I have always been enthralled by business and very passionate about creating value,” he says.
“I was not happy bent over a drawing board all day. I enjoy a team environment, and that drew me to business.
“Besides,” he adds with a laugh, “I would not recommend that people drive over a bridge if I was part of building it!”
Technology plus value
Gauba joined UPS (Atlanta, GA) and spent eight years there. “I had a pretty successful career in operations research and later on in strategy and finance. I led several global business and technology implementations for UPS.”
After UPS he did management consulting for several years. In 1997 he managed a consulting company and grew it by over 300 percent in three years. In 2000 he started MTI with the goal of “solving business problems using technology as an enabler.” He began with a partner, but today Gauba is the sole owner as well as CEO. The firm employs more than a hundred consultants.
“GMSDC has been phenomenal”
“GMSDC has been phenomenal for us,” Gauba says. “The council has several programs to network firms together. I was on its board for four years, and now I serve on the board of the U.S. Pan Asian American Chamber of Commerce.”
The council, he recalls, introduced him to HD’s Johnson and diversity leaders at several other companies. “The people I met were great mentors,” he says. “They guided me in how to present myself and what was important for their companies, so I could prepare accordingly and make a good impression.”
The consortium idea
Currently MTI is bidding on work as part of a coalition Gauba put together. The idea of a coalition is very interesting to HD’s Johnson.
“We’ve had a problem with some entrepreneurs,” she confides. “They have that fabulous maverick spirit and we like that, but sometimes it means they don’t partner well with each other.
“If diverse firms can pool together and come to us with a united front, they have a much greater chance of winning a contract. So I am interested in how MTI fleshes this out. It could be a great model.”
As Gauba sees it, “By forming strategic alliances with both majority and minority firms we can provide additional value to our clients. They trust us to bring in the right strategic partners.”
Workforce management solutions
Gauba is particularly pleased with his company’s workforce management solutions practice. “Clients ask us to manage the program for them, and we bring all the suppliers under our fold. Now the client has only one supplier to deal with. We manage all the other suppliers and help them with rate guidance, visibility to spend, compliance, cost savings at their end and other things of strategic value to the client.”
As a tier one supplier, MTI naturally has a supplier diversity program of its own. Plus, “As part of our workforce management solutions we manage suppliers for some of our clients, and where appropriate we include diverse suppliers.” It helps the client’s diversity effort as well as MTI’s.
“The world is huge and there are so many companies, but by virtue of some of our service offerings, we can now bring other diversity firms with us and give back to the community,” Gauba says.
A matter of pride
Gauba is very proud of MTI’s recognition by the Atlanta Business Chronicle as an A-plus employer two years in a row. “We were also named supplier of the year on the national level by NMSDC in 2007,” he notes.
“We were blessed,” he says with appreciation. “All our clients at that stage recommended us that year: The Home Depot and two other Fortune 50 companies.”