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Supplier Diversity

American Express helps suppliers get in the door

With nearly twenty years of formal supplier diversity activity, American Express likes to give smaller, diverse suppliers a chance to prove themselves


The formal supplier diversity initiative at American Express (New York, NY) was launched in 1995, with the aim of creating an inclusive supply chain to reflect the customers and communities the financial services company served. AmEx leaders recognized supplier diversity as a business imperative for meeting customer expectations, says Gladys Lopez, manager of supply chain inclusion.

“As we expanded the program over the next ten years, it became clear to us that our diverse suppliers were delivering a real business value,” Lopez says. “In 2004, our initiative was revamped. We added fulltime dedicated staff, and refocused and prioritized the initiative to match our business needs.”

The company also implemented a new organizational structure: it appointed supplier diversity advocates in the management teams for each business category, from technology to marketing. These advocates functioned as local extensions of the supplier diversity department, helping with outreach to the business communities in their areas.

The redesign also focused on building awareness of the supplier diversity program both internally and externally, Lopez says. For example, the company built Internet and intranet sites for sharing information. It also launched a series of three-day supplier diversity awareness sessions in Minneapolis, New York and Phoenix, as well as a major New York summit called “Opening doors to business opportunity.” The company has held smaller business summits over the past nine years, according to Lopez.

Lopez says American Express has succeeded in increasing its volume of business with diverse suppliers substantially, although the company does not release its procurement spending figures.

SBSC offers IT consulting
Software Business Solutions Consulting (SBSC, Dallas, TX, www.sbsc.com) provides American Express with IT consulting services, including design, deployment and management. The firm is headquartered in Dallas, with additional offices in New York, Atlanta, Phoenix and Gurgaon, India. It has clients in the financial, healthcare and retail industries.

SBSC managing partner Abdul Balogun began his career as an engineer. He has an undergraduate degree from City University in London, U.K. and masters and doctoral degrees from Cranfield University near London, all in EE. He also did postdoctoral EE studies at the Massachusetts Institute of Technology.

Balogun spent several years with a defense contractor working on antiballistic missiles, then moved into commercial product development for the financial industry. After spending several years in the corporate world and mulling over where to take his career next, he started SBSC with a group of friends in 2009.

Making a good impression
Lopez first met the SBSC team through another American Express business partner who works on design and development of the AmEx website. SBSC’s expertise, fast delivery and flexibility made a big impression on her. “Most importantly, SBSC has paid close attention to our need for quality results,” Lopez says.

Software Business Solutions Consulting is certified as a minority business enterprise and HUBZone company through the SBA’s program for historically underutilized businesses. In addition, Balogun is vice president of an IT consulting group within the Dallas affiliate of the National Minority Supplier Development Council (NMSDC). The group meets monthly to exchange information about corporations that have demonstrated strong support for supplier diversity by creating opportunities for NMSDC member companies.

A reputation for commitment
At these meetings, American Express kept popping up as a company with a deep commitment to diversity, Balogun says. He also heard that American Express was eager to partner with small firms.

“A lot of big companies are reluctant to give opportunities to small companies like ours,” says Balogun. “But American Express gives you the opportunity to come in and prove yourself.”

American Express also works to help its diverse suppliers improve themselves. “We do not have a formal mentorship program at American Express, but we have always been committed to developing a working relationship to position each company for future success,” Lopez says. “Each diverse supplier receives performance reviews, which gives them the opportunity for one-on-one sessions with the supplier diversity teams and category managers. This way we can help them drive their personal business objectives and learn how to enhance their relationships with American Express.”

Lopez adds that one of her most important roles as a program manager is to help diverse vendors grow and develop, “whether they are already within the American Express family or just trying to get through the door.” For example, she helps supplier executives leverage their minority vendor certifications and take advantage of networking opportunities at trade fairs, procurement roundtables and other events.

Balogun says Lopez has kept his company abreast of seminars and conferences that offer a chance to network with other business owners.

“The more people who know you, the more awareness you’re creating within the industry of who you are and the accreditation you have,” he says.

American Express procurement managers often find diverse suppliers by attending annual trade fairs and partnering with the NMSDC and other advocacy organizations, Lopez says. “It gives us the ability to see the suppliers who are out there showcasing their products and services. The other aspect is working with our peer companies in benchmarking and best practices, and observing who they’re doing business with.”

American Express accepts vendor certification by the NMSDC, the Women’s Business Enterprise National Council, the U.S. Pan Asian American Chamber of Commerce and the National Gay & Lesbian Chamber of Commerce. Credentials from the U.S. Small Business Administration and other city, state and federal certification agencies are also acceptable.

Lopez says a key business value of the supplier diversity initiative at American Express is that it demonstrates the company’s commitment to full inclusion and diversity.

“Inclusion is important to us because it enables us to have all the diverse forces and resources represented in our supply chain,” Lopez says. “By doing so, we show that we value all our suppliers, not only for their abilities, but also for their unique qualities and perspectives.”


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