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City of Los Angeles’ Supplier Diversity Program
Kecia M. Washington, Managing Director, Mayor’s Office of Economic and Business Policy By Cheryl Hentz Supplier diversity programs are business programs that encourage the use of previously underutilized minority-owned or women-owned vendors as suppliers of products and services. Such programs are important because minority- and women-owned business enterprises (MWBEs) are among the fastest growing segments of the U.S. economy. And as this business segment grows, more and more cities and their governmental agencies are looking to include them in their contracting opportunities and to help them grow their businesses. The City of Los Angeles is no different. It has had a supplier diversity program for more than 25 years, says Kecia M. Washington, managing director of the Mayor’s Office of Economic and Business Policy for the City of Los Angeles. The program started back in approximately 1983 as a sub-contractor procurement program. It has been revised a couple of times since then, with the most recent revision occurring in 1991 to bring it into compliance with Proposition 209. “In the past it was probably more of not necessarily a set-aside program but one with specific targets. Today’s program is more of a good faith effort’s task in that we’re looking for participation,” says Washington. “We have a goal and we’re asking folks to try to achieve that goal, but we have no hard numbers that we must achieve. We’re focusing, at this point, on the outreach. And if the outreach is done correctly, there should be some results yielded as a result of it.” Those outreach efforts vary, depending on the department, Washington says. In the past when there’s been a large procurement they’ve had events such as networking opportunities hosted by the departments involved in the procurement process. But all of their opportunities are posted online at the web site for the Los Angeles Business Assistance Virtual Network (LABAVN), whose web site can be found at http://www.labavn.org. “And most importantly, we encourage all of our vendors to register at the LABAVN site so everybody can see the opportunities at the same time,” she says. “But also, for those that choose to participate, the folks bidding as prime contractors are able to do their good faith efforts outreach through that site also. So it kind of gives them a link to those businesses that may be able to subcontract on that work. But again, remember, our goal is more than just subcontracting; it’s also for primes. We want to see participation at all levels.” One of their contractors on the bond assistance program is hoping to host a matchmaking event in the future where they try to partner with like-minded support groups or stakeholders to make sure the word is getting out that there are opportunities. “We also encourage folks to network on their own. We encourage the minority- and women-owned businesses to get to know the primes, get to know the work and get to know the contract administrators, so that when opportunities do come up, they’ll have a better chance at matchmaking,” explains Washington. “Because at the end of the day, we can do all that we want to from the city side, but it really is going to have to be the minority- and women-owned businesses proving to the prime that they can do the work. What we’re trying to do is set a level playing field so everyone understands what we’re looking for. But it’s also incumbent upon those subs to say ‘Hey, we can do this work.’” As the economy has tightened and many businesses have found staying in business harder, Washington has seen a lot more competition for smaller dollar contracts whereas in the past it may have just been some of the minorities or smaller local businesses who were competing. “But as the economy has constricted, we’re seeing a lot of the big boys coming in and try to bid as a prime, and that’s provided a lot more competition,” she says. Readers and business owners alike should not confuse the city’s Supplier Diversity program with the work done by the Los Angeles Minority Business Opportunity Center (LA MBOC). LA MBOC offers free services to strategic growth Minority Business Enterprise (MBE) firms, those with annual sales of $500,000.00 or above and companies that are rapidly growing firms ($200,000.00 – $499,999.00), to help them achieve their business needs. By contrast, businesses wanting to participate in the city’s Supplier Diversity program can be of any size with annual sales of any dollar amount. The Supplier Diversity program offered through the city is different in other ways, too, from the offerings made by LA MBOC. “LA MBOC is a federally-funded program that the city participates in. Its charter is actually to assist minority businesses in getting contracts and obtaining financing. Meanwhile, the Supplier Diversity program, better known as MBEWB program offered through the city, is a goal-oriented program aimed at both women-owned businesses as well as minority-owned businesses. Our focus or our function there is assuring that they have a fair opportunity to compete and to act as both prime contractors and subs in city contracting opportunities,” Washington explains. “So LA MBOC is a little bit more tailored to minority businesses and their focus is more than just getting them contracts. It’s also getting them funding and financing, helping those businesses to grow. At the city our focus with the Supplier Diversity program is giving them the opportunity to compete on a level playing field and to participate in contracting opportunities at the city.” Because it is not a set-aside program one can’t know if minority- or women-owned businesses are getting their “fair share.” In fact, because of the type of program it is there isn’t even a “fair share” to get. But while there many such businesses involved in the bidding and procurement process, there is still always room for growth, concedes Washington. “And we are looking internally in terms of determining whether there are other ways that we can encourage greater participation in the contracting process and in the outreach process because at the end of the day, that’s simply good business. The more competition that we have, the better products that we get and the better services we get, as well as often times, better prices,” she says. Her office is developing a new web site that, while it’s not yet ready to formally announce its URL on the World Wide Web, when done will offer much more than just contracting opportunities. “We really want to be a lot more business friendly to all of our businesses in the city of L.A. And we want people to know that there are lots of opportunities for minority- and women-owned businesses and L.A. is a great place to have a business and to grow a business,” says Washington, adding that if anyone needs any assistance or has any questions about the program in general, registering or doing business in Los Angeles, contact them at their new email address: jobs@lacity.org. One of the greatest successes any business program can have is seeing those who are participating get contracts and eventually grow their business. Allied Protection Services, Beacon Management Group, and Voices Media Group were each able to grow their business model while participating in the Supplier Diversity program, as well taking part in the things LA MBOC had to offer. “They were successful in getting contracts with both the city and in the private sector. Often times when someone does business successfully with the city that helps act as a springboard,” Washington says. “We’re sometimes the first ones who give them a shot. So we’re able to be a good reference customer for them.” While businesses can take part in the program regardless of their size, it should be noted that once they get to a point where they’re bidding on projects as a prime, it becomes subject to the same kind of outreach requirements as other primes. “But that’s part of the goal. We want them to grow to be able to do the same kind of outreach and I think it helps all parties involved. And again, as I said before, it’s just good business when you’re able to open up all of the opportunities to encourage competition, to get a better product at a better price,” says Washington. They’re always looking for opportunities to better increase the outreach efforts. “It’s a continuous learning process. What we’ve gotten a little bit better at is as we start to evaluate the outreach methods that have occurred we ask ‘Should we have done outreach this way or that way,’ ‘Should we have done it a little bit longer,’ ‘What else could we have done to encourage folks to get to know each other and to know the work of each other,” and that kind of thing,” Washington says. “Those are the kinds of improvement opportunities we’re looking at when it comes to outreach.” Washington says she’d one day like to see the program get to a point where programs like this aren’t necessary, and where there are always opportunities for people to compete on a level playing field and where they don’t necessarily have to encourage prime contractors who are not minority- or women-owned businesses to outreach to MBEs and WBEs. “Ideally, they’d just look at them as subs who do a good job. But that what will take awhile because folks have to get to know each other and get to know their work,” notes Washington. “You just sort of have to prove yourself with your work and let your work speak for itself and for you.” Discuss it on SBE Forum >> |
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