Minority-Owned Suppliers A Growing Global Supply Base

Minority-Owned Suppliers A Growing Global Supply Base

Bertie Marie Greer
Copyright: © 2016 |Pages: 19
DOI: 10.4018/978-1-5225-0047-6.ch021
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The increased focus on globalization, corporate social responsibility, sustainability, supplier diversity and other socially responsible initiatives have made minority-owned businesses an important supply base for buyers. Moreover, this emphasis has established a need for buyers to develop long-term effective relationships with minority owned firms. Businesses seeking to increase their global supplier diversity need to understand the global challenges of defining “minority” and other critical relational issues in order to increase effectiveness. Based on a review of the literature, and interviews with a minority supplier director this chapter discusses these challenges and offers practical implications.
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Research Impetus

Organizations are seeking to develop long-term, innovative relationships with their suppliers. One important segment of the supply base that is often ignored is minority- owned suppliers. Many companies place the responsibility of building relationships with minority owned business in their supplier diversity programs. One of the reasons supplier diversity has increased in importance and evolved into a market-driven strategy is that it makes the kind of bottom-line sense that corporations understand. For Example, IBM states that a diverse supplier base is integral to its corporate objectives and strategic imperatives because it solidifies the connection between customer satisfaction and winning in the marketplace (IBM, 2015).

Key Terms in this Chapter

Aboriginal Peoples: Means persons who are First Nations (Indians), Inuit or Métis.

SDVOB: Service Disabled Veteran-Owned Businesses.

WBENC: Women’s Business Enterprise National Council.

Credibility: Expectancy that the partner’s word or written statement can be relied on.

MWBE: Minority and Women owned business enterprises.

Minority: A group having little power or representation relative to other groups within a society.

SBA: Small Business Administration.

Trust: Firm belief in the reliability, truth, ability, or strength of someone or something.

BME: Black and Minority Ethnic Business.

MBE: Minority Business Enterprises.

NMSDC: National Minority Supplier Development Council.

Visible Minorities: Means persons other than Aboriginal peoples, who are non-Caucasian in race or non-white in color.

VOB: Veteran Owned Businesses.

Supplier Diversity: Is a proactive business program that encourages the sourcing of products and services from MWBE, VOB, SDVOB, historically underutilized business, and SBA defined small business vendors as suppliers.

Commitment: Belief that the relationship is important enough to warrant maximum efforts at maintaining it; that is, the committed party values the relationship to an extent that it is worth continuing indefinitely.

Buyers: A business that purchases products/services from another business.

Corporate Social Responsibility: Corporate initiative to assess and take responsibility for the company's effects on the environment and impact on social welfare.

EMB: Ethnic Minority Business.

Suppliers: A business that supplies a product and/or service to another business or customer.

Benevolence: The extent to which one partner is genuinely interested in the other partner’s welfare and motivated to seek joint gain.

DBE: Disadvantaged Business Enterprise.

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