Think small, think diverse
Raytheon exec gives tips on creating an award-winning supplier diversity program
There was a time when Raytheon had a network of 50,000 suppliers, each an independent relationship that required care and oversight.
Now, through a strategic sourcing framework called Enterprise Sourcing & Performance Excellence, the company has whittled that crowd down to a much more manageable list of 10,000 suppliers. Yet that increase in efficiency has not diminished Raytheon’s commitment to suppliers who are small businesses, or owned by women or minorities. The Boston Business Journal recently recognized Raytheon for its efforts in this area, naming it a leader in supplier diversity.
For Benita Fortner, the 45-year aerospace and defense industry veteran who leads Raytheon’s supplier diversity efforts, that mission is personal.
“My father had an appliance business, and after school I had to work at the store,” said Fortner. “I had the opportunity to observe the commitment, hard work and struggle for these types of businesses from the inside.”
It has long been clear to Fortner that small, minority- and women-owned businesses must have highly skilled, professionally respected advocates and champions to build working relationships with world-class companies and organizations.
The reward for large companies is equally clear. These businesses are highly motivated to succeed, and can often be exceptionally agile and responsive.
Companies looking to build relationships with businesses that are small or owned by minorities or women should focus on four key areas, according to Fortner:
Provide small and minority/women-owned businesses with personal contacts within your business so they can share their capabilities, and get guidance on your company’s sourcing and procurement processes. Give them access to senior supply chain leaders in your company, as well as technical experts.
At Raytheon, Fortner leads a five-person team who finds and stays connected to diverse and small business suppliers.
As companies look to enhance quality and control costs by reducing the number of organizations in their supply chain, don’t lose sight of small businesses. Be sure that you’re integrating them into your sourcing process and providing opportunities for them to compete on your programs.
“When we’re rationalizing our supply chain, we’re often looking at volume providers,” said Fortner. “But many times, it’s the smaller suppliers that have that unique capability that no one else can provide.”
Ninety percent of Raytheon’s strategic-source commodities include one or more small business suppliers.
Help your suppliers become better partners for your business. “Large companies have the know-how to help smaller businesses develop their technical capabilities and reduce their costs,” said Fortner. “We use Raytheon Six Sigma, an engineering process designed to create efficient solutions, to help them refine and improve their business processes.”
Raytheon also participates in the Department of Defense’s mentor-protégé program, which provides large businesses with incentives to help small businesses develop technical and operating capabilities to be more competitive on DoD programs. Raytheon and its protégé companies have received eighteen Nunn Perry Awards for the technical value and cost reduction benefits these partnerships have provided the DoD.
Give kudos to small businesses who are doing great work for you and your customers. “These endorsements can go a long way in increasing their opportunities to grow their business and be recognized in their industry,” said Fortner.
In addition to having its own awards program to recognize diverse suppliers, Raytheon often recommends those companies for such external awards as the Small Business Administration’s subcontractor of the year, the Minority Business Development Agency and the national Defense Industry Association Awards.
Last Updated: 10/19/2015