Diverse Business Development
Johnson Controls currently has more than 600 diverse suppliers representing more than 50 product and service categories, and more than $1.88 billion in purchases from diverse firms.
The supplier diversity team is led by a director of diversity business development. The initiative is integrated with corporate business strategies. The diversity vendor process accepts certified minority and woman-owned and historically underutilized businesses.
Following are the actionable ways we ensure our commitment to diversity in suppliers is met.
Growth/Strategic Opportunity Targeting
Purchasing teams target spend categories with large dollar volumes of goods and services in order to grow diverse firms and to encourage prime suppliers to form joint ventures, strategic alliances and distributorships.
Capacity Building Process
Building capacity among diverse firms is another important part of Johnson Controls’ diversity business strategy. The company uses the concept of buying groups to enhance capacity among diversity vendors. The company forms groups of eight corporations and 16 diversity vendors called "business modules" to provide focused procurement opportunities and corporate training on ways to strengthen diversity business processes. Johnson Controls has business modules operating in Wisconsin, Ohio, Tennessee, Texas, Georgia, Michigan, Illinois and New York.
Second Tier Initiative
The growth and development of diverse firms is a commitment that we regard as crucial to our continued success. Support from all of our first-tier suppliers is necessary for us to achieve our goals and objectives. Consequently, Johnson Controls requires key suppliers to include diverse suppliers in their supplier chains. This strategy serves as an enhancement to, and not as a replacement for, existing efforts aimed at increasing meaningful opportunities for diverse-owned firms to participate as first tier suppliers.
Each year, Johnson Controls provides executive-level training for managers of diverse firms. The company offers fellowships to the Minority Business Executive Program at the Tuck School at Dartmouth, the Kellogg School at Northwestern University and the University of Wisconsin's Minority Executive Program. Topics covered include: Analysis of Financial Statements; Customer Focus; Leveraging the Value Chain; and Leadership.
Suppliers compete for Johnson Controls’ coveted supplier awards. Suppliers increase their chances of winning by offering buying team strategies that provide cost reduction, continuous improvement in products and services, and diverse business involvement.