Today's Date: February 9, 2023
GLOBAL PAYMENTS ALERT: Bragar Eagel & Squire, P.C. Announces that a Class Action Lawsuit Has Been Filed Against Global Payme   •   SeqOne Genomics and the French Thrombotic MicroAngiopathies National Reference Center (CNR-MAT) Pioneer the Use of Oxford Nanopo   •   AI Goes Dating: McAfee Study Shows 1 in 3 Men Plan to Use ChatGPT to Write Love Letters this Valentine’s Day   •   TECNO's Trailblazing PHANTOM X2 Pro 5G Wins Gold at the International Design Awards 2022   •   SILVERGATE ALERT: Bragar Eagel & Squire, P.C. is Investigating Silvergate Capital Corporation on Behalf of Long-Term Stockho   •   Bioceres Crop Solutions Reports Fiscal Second Quarter 2023 Financial and Operational Results   •   Mjae Beauty Launches New E-Commerce Site to Provide High-Quality Beauty Products for Women   •   The Ultimate Family SUV: Toyota Grand Highlander Makes World Premiere   •   SHAREHOLDER ACTION ALERT: The Schall Law Firm Encourages Investors in Global Payments Inc. with Losses of $100,000 to Contact th   •   Natural Grocers® Presents Annual Donation to Jack and Jill of America, Inc.   •   Parker Waichman LLP Notes Judicial Panel on Multi-District Litigation's (JPML) Consolidation of Lawsuits Alleging that Hair Rela   •   RH ALERT: Bragar Eagel & Squire, P.C. is Investigating RH on Behalf of RH Stockholders and Encourages Investors to Contact t   •   Livent Receives 2022 EcoVadis Gold Sustainability Rating   •   Alpha Cognition Announces $6.8 Million Private Placement   •   80,000 Tulips to Illuminate San Francisco's Union Square on American Tulip Day in Celebration of International Women's Day   •   Here, Now and Always: Newly Revised & Expanded Edition of Southwest Classic   •   CUPE: Firing of Athabasca President ‘politics over education’   •   Astellas Commits to Achieve Net Zero Greenhouse Gas Emissions by 2050   •   EAGLE HILL CONSULTING NAMED A TOP CONSULTING FIRM TO WORK FOR IN NEW VAULT 2023 RANKINGS   •   Tivic Health Systems, Inc. Announces Pricing of Public Offering
Bookmark and Share

Authors Say Ignoring Minority Businesses "Recipe For Disaster"

NEW YORK - American businesses must make supplier diversity a strategic priority and stop viewing it as simply a corporate citizenship obligation, according to a new Boston Consulting Group (BCG) book.

Black News, African American News, Minority News, Civil Rights News, Discrimination, Racism, Racial Equality, Bias, Equality, Afro American News"U.S. companies need to do a better job of supporting and developing minority businesses. Minorities will become the majority of the U.S. population by 2045. Therefore, minority businesses need to deliver the value that American corporations expect -- at every level of the supply chain. Right now they do not -- as they are relegated to low-value or peripheral work that does not directly support the corporate value chain," said BCG Senior Advisor James H. Lowry, coauthor of Minority Business Success: Refocusing on the American Dream.

"Modern competition pits a corporation's supply chain against rival supply chains, so developing supplier excellence is a management and strategic imperative. Given inexorable demographic shifts, supplier diversity needs to be a strategic priority at just about every large company," he added.

Lowry underscores the following as reasons current approaches to supply chain and minority business development need to change:

Minority Business is America's Future Economy -- And Minority Economic Underachievement is a Reality and Major Liability: The adverse economic impact of minority underachievement will only grow as minorities become a larger and larger portion of the workforce. Their success in creating wealth will determine the fortunes of the nation; so if America does not make minority business success a priority, the U.S. economy is destined to stumble.

The "Procurement Culture" is Outdated and Cannot Deliver Results: Adding supplier diversity to traditional procurement is ineffective, as mandated diversity-spend targets are tactical, not strategic. And in this model, minority businesses are relegated to low-value or peripheral work that does not directly support the corporate value chain. The current procurement approach does nothing to develop the skills, scale, and financial stability necessary for minority businesses to grow into partners that can create and deliver value.

Minority Business Development is an Investment in Competitive Advantage: Soon the majority of U.S. suppliers and value-chain partners will be diverse businesses, those owned by women and minorities. So today's C-Suite executives need to see minority businesses as a strategic asset -- ripe for development -- rather than avenues for corporate philanthropy, tools for image building and PR, or mechanisms for meeting outsourcing quotas.

Diversity Strategy is a Facet of Outsourcing Strategy: Value chain development is a strategic process, focused on developing outsourcing partners as a substitute for in-house operations. Successful diversity programs need to be managed within this "developmental" paradigm. Leading companies create inclusion, and loyal allies, by developing long-term strategic relationships with minority outsourcing partners -- up to and including equity investments in their suppliers. And these relationships should be developed at all levels of the value chain, not just for non-essential goods and services.

Financially Squeezing Value Chain Partners is Counterproductive; in Fact, Current Supply Chain Diversity Programs Can do More Harm than Good: One of the biggest challenges facing minority businesses is cash flow: operations, growth, and R&D all require working capital. Yet large corporations often expect suppliers to deliver immediate value, and then wait patiently for months to get paid.

The competitive bidding process also pushes down margins on the "non-essential" work allocated to diversity targets (e.g., janitorial or landscaping services). To make matters worse, minority entrepreneurs have demonstrably more limited access to capital and credit. As a result, diversity programs often do more harm than good -- bankrupting suppliers through low-ball pricing, high delivery demands, and failure to pay.

"We desperately need a new approach to supply chain diversity," said Lowry. "America's competitive edge depends on throwing out an outdated procurement mentality that isn't working -- and in some cases is doing more harm than good. The world has changed, and American corporations need to wake up to that reality. Minority businesses will soon be the chief source of value creation in the supply chain. U.S. companies can embrace that fact and help develop the next generation of outsourcing partners, or risk getting beaten by global competitors."


STORY TAGS: Black News, African American News, Minority News, Civil Rights News, Discrimination, Racism, Racial Equality, Bias, Equality, Afro American News

Video

White House Live Stream
LIVE VIDEO EVERY SATURDAY
alsharpton Rev. Al Sharpton
9 to 11 am EST
jjackson Rev. Jesse Jackson
10 to noon CST


Video

LIVE BROADCASTS
Sounds Make the News ®
WAOK-Urban
Atlanta - WAOK-Urban
KPFA-Progressive
Berkley / San Francisco - KPFA-Progressive
WVON-Urban
Chicago - WVON-Urban
KJLH - Urban
Los Angeles - KJLH - Urban
WKDM-Mandarin Chinese
New York - WKDM-Mandarin Chinese
WADO-Spanish
New York - WADO-Spanish
WBAI - Progressive
New York - WBAI - Progressive
WOL-Urban
Washington - WOL-Urban

Listen to United Natiosns News