Women-owned businesses are fueling the nation’s economy
WBEs that network, attend conferences, and offer needed niche services are the ones that land big opportunities
Women-owned businesses add jobs at 1.5 times the national average
By Sue Marquette Poremba
Women’s businesses are a bright spot in this uncertain economy.
“At WBENC we’ve seen our certified WBEs (women’s business enterprises) growing and adding new jobs all over the country,” says Pamela Prince-Eason, president and CEO of the Women’s Business Enterprise National Council (WBENC, wbenc.org). WBENC is the largest third-party certifier of WBEs. “Many of our WBEs took courageous steps in the last few years to create innovative new sources of revenues, and they have paid off.”
Prince-Eason points to the 2013 State of Women-Owned Businesses report from American Express, Open, which backs her observations with impressive data. The report states that women-owned businesses are still growing at 1.5 times the national average. Women’s businesses have added an estimated 175,000 jobs to the U.S. economy since 2007. The total number of jobs at all smaller, privately held firms dropped during the same period.
“WBEs are fueling our economy as a result of their connections,” she says. She believes this is a sign of things to come. “At our Summit & Salute in March, we had tremendous participation from our corporate members and WBEs in our MatchMaker and meet-and-greet sessions. We know that corporations are actively seeking WBE suppliers; our women’s businesses are positioning themselves strategically to compete and grow their business with corporations.”
Lockheed Martin to suppliers: showcase your strong suit
At Lockheed Martin (Bethesda, MD), the business environment is highly competitive. Because of that, the company looks for businesses with innovative products, technologies or practices, as well as proven experience and a commitment to continual improvement.
“Lockheed Martin has about forty small business officers who serve as advocates and help us identify, develop and nurture supplier relationships,” says Suzanne Raheb, Lockheed Martin’s corporate supplier diversity leader. “These representatives also actively participate in their communities by serving on local and national boards and councils. They attend more than eighty supplier diversity-related conferences and events every year.
“Buying trends vary based on requirements. Services we purchase tend to require niche expertise, so interested suppliers should define their services around their strongest capabilities, rather than a broad range,” Raheb explains.
Defense contractor Lockheed Martin is required by the U.S. government to provide maximum practicable opportunities for small-business suppliers, Raheb points out, including suppliers that are small disadvantaged businesses, women-owned small businesses, HUBZone-certified companies, veteran-owned small businesses, and service-disabled veteran-owned small businesses. “We also have incentives to use Native American, Native Alaskan and Native Hawaiian-owned businesses,” she notes.
“Being in a needed small business subcategory gives companies extra visibility, but that’s not our only criterion. We seek companies that are innovative and have industry experience, either with Lockheed Martin, with our customers or in the industry area where we’re working. That could also include experience working with our competitors. Frequently, our competitors in one area are our partners in another area. Women’s business enterprises play an integral role in our efforts to expand and enhance our portfolio of advanced technology systems, products and services.”
Isys Technologies: available, responsive and agile
Isys Technologies, Inc (Littleton, CO) is a WBE that provides IT and engineering services to government agencies and their contractors. President and CEO Teresa Porter says her primary customers are DoD contractors, including Lockheed Martin, as well as agencies like NASA and Homeland Security.
The company’s government focus began in 2002, the same year the company was founded as a WBE. Porter, who has worked in the technical world her entire career, is the company’s largest shareholder. “We saw a niche in the market for a small business to do government contracting,” says Porter. “It was a difficult time in the country, right after we had gone to war, so in the DoD sector there were a lot of opportunities. That’s how we got connected with Lockheed Martin.”
Porter’s company was part of a mentor-protégé agreement with Lockheed Martin from 2008 to 2011, but the relationship began sooner. In 2002, Porter cold-called Lockheed Martin’s small business office and did what she calls “some basic marketing 101.” She notes, “Lockheed was my first customer. This relationship put us in business.”
It’s clear that companies like Lockheed Martin helped her company grow, but Porter believes that her company is a valuable asset to these government contractors and agencies as well. “We’re agile,” she says. “When they call, we’re available and responsive. And I think we help them in areas of their organization where we can move more quickly than they can.”
Northrop Grumman encourages suppliers to network
Suppliers, including diverse suppliers and WBEs, are critical to the success of Northrop Grumman (Falls Church, VA), which provides global security through the development of unmanned systems, logistics and modernization, cyber and C4ISR.
“Maintaining a diverse supply base is a business necessity,” says Gloria Pualani, director of regulatory compliance. “The inclusion of WBEs in a diverse supplier base is part of a strategic approach to provide more innovative and affordable solutions and products to our customers. We are proud of the long-term relationships we have established with WBE firms. The value we receive is clear.”
In 2000, Northrop Grumman developed an initiative to enhance long-term business relationships with WBEs. In support of this initiative, the company participates in trade associations to meet with qualified WBEs. “Our memberships include the National Minority Supplier Development Council and National Association of Women Business Owners. We support the outreach efforts of WBENC, and we host community and regional outreach events. We accept recommendations from customers, our aerospace industry counterparts, internal technical and program managers and our existing supply base,” says Pualani.
“We also support the Department of Commerce Minority Enterprise Development Week and the SBA’s Small Business Week outreach conferences. I encourage suppliers interested in doing business with Northrop Grumman and other companies to attend these conferences, where they’ll find a broad array of government primes and other agency participants in one location.”
All suppliers who deal with Northrop Grumman must share the company’s commitment to achieving sustained, top-tier performance. They should consistently look for ways to become more affordable and efficient, and embrace process and technology initiatives that promote excellence, like Six Sigma principles and Capability Maturity Model standards, Pualani suggests.
Connect Supply Chain pursues defense work and helps disabled workers
Connect Supply Chain (Seattle, WA) is a group of twelve nonprofit manufacturing and service companies, all committed to the creation of jobs for those with disabilities.
Connect Supply Chain pursues work across the defense industry. Some of the group’s services include complex machining, sheet metal fabrication, outside processing, assembly and kitting.
Group members knew that as small corporations, they had little success breaking into large defense contractors, and decided they would have more success as a group. Member agencies first began meeting to explore ways to collaborate in late 2008. Connect Supply Chain received its first grant from NISH, a nonprofit that helps build job opportunities for people with disabilities. With the grant, the group hired a consultant to help guide it through the brainstorming process. In summer 2010, an “Aerospace First” strategy coalesced. The vision developed into an action plan, which was used to secure a second, larger NISH grant.
Melinda Jenks was brought on board as COO in 2011. She agreed that the group members had more clout as a unit. “By joining together, these twelve corporations have a greater breadth of capabilities and a greater strength to offer,” she says.
Jenks has a strong aerospace and defense background, and previously served as a vice president with Synchronous Aerospace, an aerospace parts manufacturer. She worked on contracted projects with the U.S. Army and Boeing Defense.
Getting in the door
Jenks worked hard to meet with Northrop Grumman and introduce the companies’ capabilities. Her efforts were successful. Connect Supply Chain is now a qualified source for Northrop Grumman, a status that allows the company to enter competitive bids. “We’ve been given a chance to bid and we’ve won work, and that gives us the opportunity to hire people with disabilities.” Connect Supply Chain will provide Northrop Grumman with sheet metal and small machined parts.
Northrop Grumman has also enlisted Jenks to speak at conferences around the country, to raise awareness of how nonprofits can connect with prime contractors. This has led other defense contractors to invite Jenks to bid on new opportunities. “Northrop Grumman has allowed us to gain visibility, not only for our facilities but for what individuals with disabilities can do.”
Itron formalizes SD in response to customers
Itron (Liberty Lake, WA) has officially had a supplier diversity program for two years. It was a program that the customers pushed for, says Russ Kenworthy, who is responsible for supplier diversity at the company. “We had customers who began to ask if Itron had any type of supplier diversity program,” he explains. Since Itron is a customer-focused company, Kenworthy says, the company responded to customer concerns. “We understand it is important,” Kenworthy says.
Requirements for diverse suppliers are project-specific. “We have a third-party database managed by a company called CVM Solutions,” Kenworthy explains. “We can search by region or product-specific, and we look for diverse suppliers in those searches.”
Itron, which provides technologies to utility companies, also finds WBEs and other diverse suppliers by attending several diversity events a year. In addition, several customers host match-making events, which bring potential suppliers to the company. “Suppliers also cold-call Itron,” Kenworthy adds.
Supplier diversity makes sense for Itron. “Our goal is to serve the customer at the highest level, and when customers are demanding programs like this, Itron responds.”
Alfa Electronics aims for longstanding relationships
Alfa Electronics (Canton, GA) was established in 1993 by co-founder Bettina Clark, who spent almost ten years in the electronic component distribution industry before starting her company. In 2006, it became a woman-owned company. It became a certified WBE in 2010 to address the strong demand from diversity channel partners to meet customer diversity-spend initiatives.
For many years, Alfa served as a shortage fulfillment distributor for the OEM and CM markets. However, in the last five years Alfa has strategically changed its business model to become a fully franchised distributor for electronic and electromechanical component products. “Our services include inventory management, just-in-time delivery, 3PL services, engineering support for new product and second sourcing, and customer-specific material management solutions not traditionally offered by the supply channel today,” says Clark. “Alfa has always pursued longstanding positive relationships, and that ultimately made this franchised distribution model possible.”
Responding to an urgent need creates a bond
The company connected with Itron almost nine years ago in a shortage fulfillment role. “Itron was urgently requiring components to keep its production line running and Alfa was requested to help fill this need. Because building long-term relationships is so important to Alfa, and because of the urgency of this requirement, we quickly sourced product for the shortage and I personally hand-delivered the components to the procurement team,” Clark explains. “Itron, also being a company that values relationships with its suppliers, subsequently entered into a shortage fulfillment partnership with Alfa.”
During the onset of a recent counterfeit component crisis in the industry, Alfa worked with Itron to establish a counterfeit mitigation program for Itron. Alfa’s role grew to managing excess inventory and eventually to being a fully franchised diversity supplier supporting annual purchase agreements.
Itron has helped Alfa in many ways, perhaps most importantly by providing mentoring to Alfa and allowing it to become a world-class franchised distributor. “Itron’s support has helped us to grow in our marketplace and add franchised manufacturer content to our line card,” says Clark. In turn, Alfa can provide Itron with competitive second sourcing and cost savings. In 2011, Alfa gave Itron its Diversity Customer of the Year award for the company’s strong commitment and active approach to supplier diversity.
URS finds WBEs to fill many critical needs
Reaching out to WBEs has become a business reality, according to Sam Artis, small business liaison officer with URS (San Francisco, CA). URS is a provider of engineering, construction and technical services. “Women are owning businesses in numbers that challenge men, and we are now seeing the results of that,” Artis says.
At URS, the procurement dollars spent on WBEs have increased significantly over the past five years. In 2008, URS spent $166 million with WBE small businesses, representing nearly 13 percent of all procurement dollars for that year. In 2012, the dollar amount has grown to nearly 19 percent, and $328 million. “I think these numbers are reflective of both the economy and business ownership,” says Artis.
He notes that all URS vendors compete for contracts, and the fact that a company is woman-owned isn’t a guarantee of business. But women are running many businesses that fit URS’ needs.
“We do sophisticated work with the Department of Defense and the Department of Energy. These WBEs are providing engineering and technology services, and this reflects the growth of the role of women in STEM industries,” he explains.
Valuable resources for suppliers and clients
Artis says he finds the WBEs through the System for Awards Management (SAM, www.sam.gov), a government portal for businesses looking for federal contracts. SAM is a new service offered by the federal government, and, according to its website, will include the capabilities of several current systems: the Central Contractor Registration/Federal Agency Registration, the Online Representations and Certifications Application, and the Excluded Parties List System. “The businesses have to be registered with the SAM database. If they aren’t in there, we aren’t going to find them when we put together our bid list.”
Pepco Holdings, Inc: a long history of supplier diversity
The supplier diversity initiative at Pepco Holdings, Inc (Washington, DC) was begun in the 1970s after leaders recognized that the customer base was a diverse group, explains Rhonda J. Mencarini, manager of supplier diversity. “When we help small businesses grow, they buy more from us, and that helps us grow. Supplier diversity is enlightened self-interest.”
Pepco Holdings, which delivers electric service to customers in the Maryland suburbs, Washington, DC, Delaware and New Jersey, works with organizations focused on WBEs along the East Coast and Mid-Atlantic regions. “We go to conferences in our industry, and we encourage women vendors who might be interested in working with the energy industry to attend too,” Mencarini says. “We find a lot of companies that way.”
Mencarini adds that Pepco Holdings often turns to former employees as new suppliers. “Over the years we’ve had women who have left the company and formed businesses, and now they are suppliers to our company.”
General Mills: committed to diverse connections
General Mills (Minneapolis, MN) has an ongoing commitment to establish and grow successful business relationships with qualified minority and women-owned business enterprises, according to Darren Harmon, director of supplier diversity and business development. “Fulfilling this commitment is important to our shareholders, our increasingly diverse consumer base, the communities in which we operate and ultimately the success of our company,” he says.
“We find WBEs at national or local conferences and procurement meetings of the Women’s Business Enterprise National Council and National Minority Supplier Development Council and their affiliates, and hear about them from supplier diversity peers across industry networks. WBEs can also use our e-sourcing supplier portal to register their businesses, outline capabilities and provide other key data,” Harmon notes.
Forging lasting relationships with diverse businesses promotes mutually beneficial growth and is key to winning in the marketplace, he adds. “The thought leadership, innovation and cost-effective solutions delivered by our diverse suppliers provide a competitive advantage and position General Mills for short and long-term success.”
COMPANIES INTERESTED IN DOING BUSINESS WITH WBEs
Check website for current listings.
|Company and location
|General Mills (Minneapolis, MN)
|Itron (Liberty Lake, WA)
|Technology for utilities
|Lockheed Martin (Bethesda, MD)
|Global security and aerospace
|Northrop Grumman (Falls Church, VA)
|Pepco Holdings (Washington, DC)
|Sanofi US (Bridgewater, NJ)
|Discovers, develops and markets new and innovative healthcare solutions
|URS (San Francisco, CA)
|Engineering, construction and technical services
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