President's Message
February 2012
Dear Members,
Social Responsibility & Shareholder
Value
As it has been for the last several years, our
February membership meeting is dedicated to Supplier Diversity. Those who have
been actively involved with ISM-New
York or work within organizations that are striving
to implement best practices, understand that "Social Responsibility"
is no longer thrown around as a simple marketing pitch. The programs associated
with Supplier Diversity and Sustainability have been slowly gaining traction
over the past 15+ years and the related expenditure continues to increase.
To the cynic, corporations that create and
market these programs do so only as a tool to compete for government contracts
and increase their customer base by building goodwill with the various
diversity communities (Women, African American, Hispanic, Gay & Lesbian,
Veterans ...). There may have been a bit of truth to this initially, however
the benefits associated with these programs is well documented.
But how does that impact shareholder value? Can it boost value by reducing cost?
An effective supplier diversity policy is a
significant element of a social responsibility program, exhibiting a positive
message to employees while enhancing a company's image. Unfortunately, doing
the right thing isn't always the least expensive way. Nevertheless, if the
corporate vision is long term (years rather than quarters) cost reduction can
take many forms.
Can a sourcing organization find best-in-class solutions with smaller firms?
It's not a surprise that, when compared to large organizations with deep pockets, small suppliers may struggle providing best-in-class solutions. That being said, innovation is driven by competition and the ability to think outside the box. Many of our most successful corporations started as small entities trying to make a difference. Think Apple, Microsoft, Google, Dell, Berkshire Hathaway to name several. All started with just a handful of people. Think of how differently these organizations are manage today compare to their infancy. Despite their continued success, many may argue that the overall performance of these companies degraded over time.
Yes, maybe some of the earlier corporations
had ulterior motives when implementing social responsibility programs.
Nevertheless, they broke important ground. In order to ensure these programs
continue to grow successfully, it's important that more organizations buy into
both the long term social and financial benefits.
That being said, I hope you will take advantage of ISM-New York's various offerings. We have this month's Supplier Diversity membership meeting and should be announcing plans in the coming weeks for our annual Supplier Diversity Expo. Additionally, in the 2012/2013 program year we will be creating a Director of Sustainability and Director of Supplier Diversity to ensure both are provided the appropriate level of support within the organization.
Thank you and I look forward to seeing you at the next meeting.
Regards,
Kenneth Going Jr.,
President, ISM-New York
