Beyond Compliance:Beyond Compliance:

Creating and Executing Successful Strategies for DBE Participation and Workforce Diversity

Creating and Executing Successful Strategies for DBE Participation and Workforce Diversity

PanelistsPanelists

Brian McCarthy (Moderator)

– Program Management Consultant, CDM

Heyward Davenport

– Regional Director, Minority Business Development Agency

Michael Jefferson

– Diversity Manager, Metropolitan District of Hartford

Why beyond compliance?Why beyond compliance?

Stakeholders

Benefits

Benefits Drive StrategyBenefits Drive Strategy

Program Management Strategy

Risk Management

Benefits

Context – Large Public Works ProgramContext – Large Public Works Program

Context and experience comes from a large urban public works program for a mid-size city, primarily horizontal construction

Not a lot of existing local MBE & WBE capacity

Biggest program ever undertaken by owner

Voter approval required

Politics

Compliance FrameworkCompliance Framework

DBE (MBE/WBE) participation percentages as condition of funding or a legal requirement

EEO / Workforce Diversity

Set-Asides

Prevailing Wage

Project Labor Agreement

Leading off . . .Leading off . . .

The Owner’s Perspective

– Program Benefits

– Risk Management

– Managing expectations

– The importance of a coherent strategy

– Getting it done

Next up . . .Next up . . .

Resources to help you

– Leveraging programs and agencies

– How to engage their support

– What they can do

– What they can’t do

And then . . .And then . . .

Program management to support the strategy

– Leverage existing tools & processes

– Forecasting

– Tracking and Reporting

Owner’s StrategyOwner’s Strategy

Manage Benefits

Manage Risk

DBE Participation & Workforce Diversity in Context of Program Benefits & Risks

DBE Participation & Workforce Diversity in Context of Program Benefits & Risks

Public Agency

– High Visibility

– High Expectations for your Program

Vehicle for economic growth

Vehicle for economic opportunity

Public & Local Business Stakeholder View

– Program Benefits = jobs & business opportunity

DBE Participation & Workforce Diversity in Context of Program Benefits & Risks

DBE Participation & Workforce Diversity in Context of Program Benefits & Risks

Risks

– Adverse publicity

– Public protests

– Erosion of support for the program

– Non-compliance with funding & legal requirements

Compliance MindsetCompliance Mindset

Manage Risk of Non-Compliance

Risk = Participation Goals not met

Consequence = Lose funding

Risk Management Strategy Includes

– Solid Contract Terms

– “Good Faith Efforts”

– Tracking and Reporting

– Creating the Paper Trail

What’s missing?What’s missing?

Achieving, documenting, and reporting compliance may not deliver the program benefits expected by some stakeholders

From their view (right or wrong), you have not delivered

Why take a narrow approach?Why take a narrow approach?

It’s the way we’ve always done it

It’s worked for us before

Inexperience

See doing more as an unnecessary expense

Fear of engagement

Not part of organizational culture

Beyond ComplianceBeyond Compliance

Broader view of risks and benefits that are related to issues of DBE and workforce participation

You’re already doing a lot of the legwork to support taking these extra steps

Leverage work you’re already doing

Proactively manage expectations (benefits) and risk

StrategyStrategy

Manage expectations

Engage the local small contractors

Engage the general contractors

Engage external resources

Leverage existing tools & systems

Publicize your efforts and successes

Manage ExpectationsManage Expectations

City Plans $1.6B Sewer Upgrade08/19/2009The Daily Planet

Mayor John Doe told the crowd the project would create jobs, especially in the eastern part of the city, a promise he touted during his campaign.

Jobs will be available for "hundreds of people for construction above the ground and below."

Managing ExpectationsManaging Expectations

Realistic Jobs Forecasts

– Job Preservation Versus Job Creation

– Consistent Approach

Realistic Subcontracting Opportunities Forecasts

– Breakdown by trades

– When will opportunities happen?

Engaging the Local DBE SubcontractorsEngaging the Local DBE Subcontractors

Pursue them

Maintain a vendor database

Provide Educational Opportunities

– How to work with your agency

– How to work with general contractors

Develop relationships before there are problems

Engage the General ContractorsEngage the General Contractors

GC to Subcontractor matchmakers

Get off on the right foot – you take these issues seriously and will pay attention to them

Plug GC into local resources, if they are not from the area

Engaging External ResourcesEngaging External Resources

Government Agencies

– Minority Business Development Agency

– State Departments of Labor

– Small Business Administration

Other Organizations

– Community-based job training & placement programs

– Industry and trade organizations

Leverage Existing Tools and SystemsLeverage Existing Tools and Systems

Planning and design phase analysis

– Workload & opportunity forecasting

Contract Administration

– Payroll reports

– Progress Meetings

Internal & External Communication

Publicize your Efforts & SuccessPublicize your Efforts & Success

Be out in front

Prevent protests

Have good stories and evidence to fall back on

Anecdotes are effective

Strategy to Go Beyond ComplianceStrategy to Go Beyond Compliance

Manage expectations

Engage the local small contractors

Engage the general contractors

Engage external resources

Leverage existing tools & systems

Publicize your efforts and successes

Engaging External ResourcesEngaging External Resources

Most of these organizations exist to help the small or minority business, or the individual worker. How can they help or support me, the program owner?

Most of these organizations exist to help the small or minority business, or the individual worker. How can they help or support me, the program owner?

What’s in it for the Program Owner?What’s in it for the Program Owner?

Expands your network

Adds credibility

Creates publicity

Builds local capacity

Doesn’t cost much

Proactively managing risk

What do they have to offer?What do they have to offer?

Training & education

Networking

Access to capital for subs/suppliers

Realistic advice

Coaching & mentoring

Certification assistance

OJT Funding

Risk Mitigation PayoffRisk Mitigation Payoff

Establishing relationships

Track record of support & fair play

“Problem children” get independent support

Good publicity

Reduce chance and severity of problems

About the MBDAAbout the MBDA

Minority Business Development Agency, part of the US Department of Commerce.

Created as an executive order in 1969 by President Richard M. Nixon, first known as the Office of Minority Business Enterprise.

Mission driven as an entrepreneurial organization; we actively promote job and business growth to enhance competitiveness for minority businesses of all sizes and industries; we are committed to wealth creation, teaming capabilities and cultivating opportunities in domestic & global markets.

MBDA regionsMBDA regions

…our 5 regional offices cover all states including Puerto Rico, too.

Enterprise CentersEnterprise Centers

The MBDA funds its network of Minority Business Enterprise Centers, Minority Business Opportunity Centers & Native American Business Enterprise Centers.

MBEC leverages business alliances with government agencies, financial institutions, procurement supply chain programs and corporate America. In the NYNEC: 8 Centers & 2 District offices.

MBEC assists the small business owner to cultivate business resources which are geared to serve minority entrepreneurs seeking to pursue accelerated growth.

MBDA’s Approach to Program OwnersMBDA’s Approach to Program Owners

Establishes a high profile partnership to demonstrate owner’s commitment and sincerity to local and MWBE contracting programs

Provides resources such as vendor outreach and strategic alliance with local resources

Co-sponsors and acts as primary event manager -including staffing and coordination - for project outreach events

Facilitates introductions to local technical assistance organizations and associations in such areas as certification, bonding, insurance and joint venture development.

A couple of recent examplesA couple of recent examples

In 2009, MBDA & local MBEC’s hosted a B2B Procurement matchmaker with 5 NY City Agencies who never worked together to identify 20 prime contractors who met 125 MBE vendors.

Significant outreach and partnering efforts in Hartford include B2B matchmakers and educational programs. MBE prime awarded one of largest contracts in agency’s history. MDC named Northeast regional Partner of the Year.

We want to helpWe want to help

www.mbda.gov

The MBEC’s, MBOC’s & NABEC’s are funded by the U.S. Department of Commerce as technical assistance centers

Program Management Tools to Support the StrategyProgram Management Tools to Support the Strategy

Use existing tools & processes to your advantage

– Forecasting subcontract opportunities and workforce requirements

– Extract useful information from standard data sources

– Tracking and Reporting

– Communication & Outreach

Planning and DesignPlanning and Design

ProcurementProcurement

Maintain & Use a Vendor Profile Database

Forecast upcoming work

Tack matchmakers on to pre-bid meetings

Use technology to push information

Construction AdministrationConstruction Administration

Maintain visibility

– Progress meetings

– Site Inspections

Mine data from daily reports

– Subs

– Crews

– Trades

Construction AdministrationConstruction Administration

Certified Payrolls

– Job classifications

– Ethnicity & Gender

– Residency

Tracking & ReportingTracking & Reporting

Education & OutreachEducation & Outreach

Many small firms have not played in your arena

Conduct seminars & workshops on how to do business

Reinforce expectations

Deliver consistent messages

SummarySummary

Focus on the program benefits to develop your strategy

It’s a contact sport – you’ve got to be visible

Engage stakeholders

Use you’re existing systems and tools

Don’t go it alone – partner up

Publicize your efforts and successes

Closing Thoughts on Strategy & Risk ManagementClosing Thoughts on Strategy & Risk Management

Benefit – from Latin benefactum (good deed) bene (well)

Risk – from French risque, Italian riscare (to run into danger) – ancestral meaning could be “sail dangerously close to rocks”

Manage – from Italian maneggiare (control a horse) fr Latin manus (hand)

Program Management is a contact sport!

Hands – on approaches will help keep you off the rocks!

Questions?Questions?

Brian McCarthy

– Program Management Consultant, CDM

Heyward Davenport

– Regional Director, Minority Business Development Agency