It is the hot, humid and last lazy dog days of summer, as our mother used to refer to them. Then we were excited about new home room teachers, cool clothes and maybe even a new school building. These days, its the return to a more normal business landscape. Our customers will be back from final vacations in a week or two and we’re planning how to make the most of this year’s final quarter. For many SDMWVLGBTBE (Small Disadvantaged or Disabled, Minority, Women, Veteran, Lesbian, Gay, Bisexual or Transgendered Business Enterprise) business owners, this has become a good time to think about the benefits of diversity certification — most of our company’s certifications renew in September and October — and we’ve been getting calls from many people who are just starting their certification research. So it seems like a good time to talk about certifers and what’s out there.
Who are the certifying organizations?
It is a lengthy list that can be simplified by type. There are diversity certifications offered by virtually every level of government: federal, state, county and municipality. These certifications often rely on the US Department of Transportation’s rules to define which businesses may be certified. Each certifier may have slightly different expectations and processes, but underlying programs expect:
- Company is an independent, for-profit business.
- The business is at least 51% owned and controlled by a socially and economically disadvantaged individual(s).
- The company’s disadvantaged owners are US citizens or lawfully admitted permanent residents.
- The business meets the Small Business Administration’s size standards for its primary NAICS code.
There are several third party certifiers: Women’s Business Enterprise National Council (www.wbenc.org); National Minority Supplier Diversity Council (www.nmsdc.org); LGBT business owners – National Gay and Lesbian Chamber of Commerce (www.nglcc.org); or people with disabilities business owners – US Business Leadership Network (www.usbln.org). Third party supplier rules can be different. For example, social or economic disadvantage is not part of the criteria — and personal net worth statements are generally not required. In general, the businesses are not restricted to being considered small — large DMWVLGBTBEs can apply and be certified. But, NMSDC only certifies US citizens.
Don’t know what to choose because there are so many choices? Taking time to poll your customers may be the best way to choose. We often recommend reviewing these certification strategies.
What will certification do for me?
Hate to say, but it depends. Diversity certification isn’t a golden ticket, it’s a marketing tool. You still have to be good at what you do, and continue to offer valuable goods or services to your customers. What it does offer is instant recognition. Many SDMWVLGBTBEs aren’t aware of the value certification adds in supporting their clients’ diversity and inclusion goals — and it is NOT just the government clients. Corporate cultures are becoming more interested in commitments to supporting their own diverse customer base. Take, for example, the Billion Dollar Roundtable (BDR) comprised of 24 corporations with a minimum $1 billion annual 1st Tier MWBE Supplier Diversity spend, that in 2011 spent another $6.5 Billion with “Other Diverse Suppliers” including veterans, service disabled veterans and LGBT suppliers. BDR members encourage prime suppliers to engage with SDMWVLGBTBEs by setting participation goals.
In our world, we use our certifications in three ways. We often serve as prime on moderate-sized government contracts. In many cases those contracts also require us to meet supplier diversity goals — we can self-fulfill the WBE portion of the contract but not the MBE portion, so we have MBE certified suppliers. We’re approached frequently to subcontract to other government primes, some who may be certified themselves but most often with large companies that aren’t certified — remember, government agencies have size limits. And finally, in every piece of marketing material, web site, business card, etc. we declare our certification status so potential clients know we’re certified.
The key to successful SDMWVLGBTBE certification is choosing the program that best suits your business and using it to enhance your marketing efforts.