Editor’s Note: This is the second of a two-part series written by ConnXus founder Founder & Chief Connector Rod Robinson. You can read the Part 1 here.
Below are some tips for implementing a successful small business subcontracting plan:
Conduct an analysis of each category of spend: Analysis of total current spend as well as determining current diversity spend and supplier demographics is a critical first step in any supplier diversity effort. Understanding how we are currently performing within each spend category as well as within each diverse supplier classification, will play a key role in helping us develop realistic spend goals.
Set realistic spend goals: Conducting a thorough analysis of current spend and supplier profiles on the front end will be the key here. Output of the analysis should enable the construction of a matrix showing a listing of key spend categories that includes an indication of diverse supplier availability within each spend category. This will not only support “bottom-up” development of realistic goals, but also identify areas for more aggressive supplier outreach and development.
Identify alternate sources of diverse suppliers and outreach: This is particularly important within any underrepresented categories identified during the analysis. A few new services have emerged over the past couple of years to make it easier for corporate buyers to locate and engage diverse suppliers.
Establish policy/practice of posting bid opportunities within target categories to drive tier 1: Make it a policy to include at least 2 diverse suppliers in any products or services going out for bid. As long as the steps above are being followed, building a qualified pool of diverse suppliers should not be a problem in most cases.
Optimize the tier 2 reporting process by through automation: Many organizations are not even scratching the surface when it comes to quantifying and reporting tier 2 diversity spend. This is primarily because manual processes are still quite prevalent. This approach makes it difficult to collect, analyze and report from more than a few companies. The ConnXus Tier 2 Reporting Tool allows tier 1 majority suppliers to simply upload directly into a portal. This tool makes it possible to capture tier 2 spend from hundreds of prime suppliers which could provide a significant boost to total diversity spend.
Leverage available technology solutions to streamline the reporting process: Leveraging an automated tier 2 solution, as described above, provides the perfect foundation to streamline the entire FAR 52.219-9 annual reporting process.