Hilton O. Smith is a senior VP at Turner Construction Co (New York, NY), the construction management, civil engineering and planning giant. Turner’s supplier diversity program is forty years old, he notes. “It started under the direction of Howard Turner, the chair at the time, who was one of the sons of the Turner family that founded the company in 1902.”
Smith himself joined the company in the early 1970s. Today he’s in charge of Turner’s community affairs program, which includes M/WBEs. “We work hand in hand with purchasing, meet with them before every project starts and see what we can do to carve out packages that will give the M/WBEs opportunities to bid.”
Minority contract utilization
Smith recalls exactly how Turner’s supplier diversity program got started. It was back in the late ‘60s.
“We bid successfully on a project for the City of Oakland, CA that had a 20 percent minority contract utilization requirement. We felt that this was a good time and place to begin such a commitment, and we said ‘yes’ to the city’s program.”
Turner was already in contact with Transbay Engineers (Oakland, CA), an MBE headed by Ray Dones, who was also the founder of the National Association of Minority Contractors. So Gene Von Wening, the VP of Turner’s Northern California office, got in touch with Dones and a joint venture was arranged to do the work. “And that’s how it all started,” Smith remembers.
The project was a redevelopment in downtown Oakland and it went well. Turner continued its relationship with Dones’ firm and it “mushroomed across the country,” Smith says. That was Turner’s first venture into supplier diversity, “But of course our workforce diversity program had begun several years before that. Today, we have quite a few minority engineers who started with us and have now become successful entrepreneurs.”
Prime program
Turner, says Smith, considers its supplier diversity program to be “the number one program for contractors in corporate America. In 2005 and 2006 we were members of the billion-dollar roundtable, and hopefully we’ve done it again for 2007.”
Over the years, Smith notes, Turner’s business with minority firms has averaged between $500 and $800 million, including some FEMA loan firms. “We are also proud of our work with the NMSDC and WBENC. We’ve received several awards from NMSDC.”
Turner has a prequalification form to gauge which MBEs to work with. The company looks for NMSDC certification, “and we use some other certifications too,” says Smith. “We go national and we also go state by state and city by city. We look to see what the minority firm’s track record is in the relevant cities, states and counties because we want to utilize firms that know what they’re doing and have worked on the scale we’re considering.”
Turner has a mentor/protégé program “for firms that need it. We want them to tell us what they need and then we help them from there,” Smith says.
Second-tier requirement
Smith notes that Turner has an in-house goal of 20 percent for its second tiers. “We tell them what our goal is and if they can’t do it as a subcontract we try to do it on the supplier route.
“You have to be very creative and imaginative when you have one of these programs,” he adds. “If you can’t find a minority elevator contractor to do the work on a particular job, for instance, you can probably find a minority painter who can paint the elevators. You have to look at the entire supply chain to pinpoint the opportunities.”
These days, Smith adds, more clients than ever are asking more about supply-chain commitment. “We do a lot of work for national companies that have their own in-house programs and commitments.”
On a recent job for a major university, Smith notes with a smile, “We had only one meeting to talk about the technical part of the job... followed by six meetings to discuss the supplier diversity component.”
That, he feels, is “because we’re working with clients who have commitments of their own.”
Miles McClellan Construction works for Turner in Ohio
Lonnie Miles, with a CE from Southern University (Baton Rouge, LA) and a PE in the state of Ohio, is CEO of Miles McClellan Construction Co (Columbus, OH). “I worked for Goodyear from 1969 to 1975,” he notes. “Then I was recruited by Turner and worked there as a project engineer from 1975 to 1980. I got a chance to learn a lot about construction.”
After five years at Turner he decided to “give it a shot” on his own. “I formed a company in Columbus in 1980 and started out on smaller projects. Today we’re doing probably $50 million a year. We’ve come a long way and have plans to go even further!”
Building the Nationwide
Miles called his new company Concept Construction, but later changed the name to Miles Construction. Around 1990 it became Miles
McClellan Construction as Miles took a partner, another Turner alum.
The company did its first partnership work for Turner in 1998 as part of the team that built the Nationwide Arena sports and entertainment venue in Columbus. “We were about 15 percent of the construction management team and held another four or five million in contracts beyond the management part of the project.”
In fact, he notes, it was an official part of his job to bring more MBEs into the arena construction. “We had a pretty good grip on what was going on in the Columbus area and were able to help make the Nationwide a successful project utilizing minorities.”
Other experience
While Nationwide was Miles Construction’s first partnership type arrangement with Turner, the company had previous experience as a subcontractor to Turner. “That relationship still continues today,” Miles says. “Right now we’re doing some work at Children’s Hospital in Columbus as a sub with Turner.”
While most of Miles McClellan’s work has been around the Columbus area, the company recently broke ground on a $40 million aircraft manufacturing facility for Honda in Greensboro, NC. “Honda is one of those companies that demands a diverse workforce and a diverse contractual relationship,” Miles notes with pleasure.
Pushing at NMSDC
Miles has been a member of the South Central Minority Business Council, part of NMSDC, for some twenty years, almost as long as he’s been in business. “One of my pet projects is getting better access to the decision-makers,” he says.
“We’ve been pushing to come up with a better way of communicating what opportunities are available, so the MBEs can start to talk to the appropriate people about getting in on the early stages. In fact, that’s how we ended up getting involved with Honda,” he notes.
“The process does work but you have to have contacts who are willing not to just be gatekeepers but to pass you on to the people who really can help you.”
Miles himself is recently back from a stint at the Kellogg Institute, sponsored by NMSDC and underwritten by Toyota. “We haven’t worked for Toyota yet, but they wanted to sponsor us. I’m hoping that means we’ll get a chance with Toyota soon,” he says.
Starting in public works
The company started as a public works contractor, but it was never in the government’s 8(a) program. “Too much paperwork,” says Miles. “We thought the way to do it was to just go slowly, work off our own merits, and finance on whatever we made the previous year.”
A little scary at times? “It was scary every day!” Miles admits. “There’s no relaxing in the construction industry!”
A lot is based on trust
Turner’s Smith adds that in the construction industry, “You have to know who you’re working with, know what their capabilities are and know you can trust them.
“And I can tell you Lonnie Miles is one of the finest engineers in this industry that anybody would ever want to work with. He can work with us anywhere in the country.”
“It’s true,” says Miles, “that everything we do is pretty much based on trust and trust means a lot to our organization.”
Spurred on by Turner
That first partnership with Turner has brought other large contracts, Miles discloses. “That’s one of the beauties of having a smaller company tag along with a larger company. The whole mentorship thing is designed to project the mentee to the next level.”
When he got out of school, he recalls, “The construction industry was basically controlled by white males and they were not hiring black engineers. But Turner gave me that opportunity and I had some great mentors there.
“That goes not only for me, but for many of us. Many MBEs in construction today were spurred on by Turner.
“It’s almost like we have a little Turner alumni club going.”
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