RAW FILE

2016 USBLN

19th ANNUAL NATIONAL CONFERENCEORLANDO, FLORIDASEPTEMBER 20, 2016SUPPLY CHAIN DOBES

KEY STRATEGIES FOR BUSINESS DEVELOPMENT10:05 AM EST

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>> DR FRED MCKINNEY: Good morning.>> Good morning.>> DR FRED MCKINNEY: My name is Fred McKinney and I'm the

managing director of the Minority Business Programs at the Tuck school of business at Dartmouth College and it is my honor and privilege to be with you today. And with this outstanding panel to talk about key strategies for business development. I hope that you have enjoyed your time here at USBLN so far, and hopefully we can continue that this morning with a panel discussion about a very important topic. Let me just see by show of hands, how many of you are DOBEs.

(applause)Okay. You're in the right space. So, you know, we've got

on our panel today, two DOBEs and also a corporate representative from UPS. And we're going to begin with just some brief introductions because I want to save most of our time for a conversation that we'll have with you. We want to include you in that conversation. So, there will be time -- plenty of time for you to ask questions of the panel and myself about business development strategies.

A little bit about my background. I've been at Tuck School of Business since April of 2015 but before that, I was the president and CEO of the greater new England minority supplier development council which is a regional affiliate of the national minority supplier development council so I'm very familiar with areas of certification but also corporate supplier diversity and diverse business development and before that I was on the full-time faculty of the university -- school of business. I am a practicing economist. I do practice the dismal science, but I will try to stay away from the dismal topic of economics and we'll talk about business today. That's a little bit of my background. I'm going to let each one of our panelists briefly describe themselves and we have a short PowerPoint presentation that also do a little bit of this introduction but I want to start with Deb talking about herself and then we'll go down the line.

>> DEB DAGIT: So, Deb Dagit. If you're in business, it helps to have a name that's alliterative. Deb Dagit Diversity is the name of the business. I've been self-employed as a DOBE for three years. I'm also certified through W -- bank. The women own business. I was chief officer of Diversity at a company over a period of about 25 years. Before that, I was in the business of placing people with disabilities into jobs out in the San Francisco Bay Area for about four, and we all got to hear Tony Qualo speak this morning. I spent a lot of time during the time that the ADA was on the Hill advocating for the pass into the ADA.

Before that, I was in HR doing both recruiting and EEO and affirmative action, and yes if you add all that up, I do color my hair.

>> I don't color my hair. But, I tell you, I think it's coming back. You know, I get up every morning and I kind of feel, I go, yeah, I think it's coming back. So I'm being very patient. My name is Jack Smith and I'm the CEO of Charlotte national Partners. I've had a lot of jobs. I was one of those guys that could never keep a job so I decided one day I should be working for myself so I started Charlotte national Partners in 2003. Our primary business is commercial lighting. We do all types of commercial lighting projects all over the United States and a few Internationally. A couple years ago -- actually four years ago, I bought into a business at Ecuador that makes a soil amendment that's used in agriculture. And I did this thinking, this will be great to sell in the United States. And then I found out that the USDA would not give me a permit to bring it into the United States.

So kind of a bad decision in one part, but it turned out to be a great business in South America so we still do that down

there and that company is called Emerald Valley bioproducts. I took a trip into the country of Ecuador and necessary a family of farmers who grow quinoa and I discover these people live on less than $500 a year. The structure I thought they stored their farm equipment and things was actually their house. So when we came back to the United States and I discovered that quinoa was selling for seven and eight dollars a pound in the United States, we decided we would start a company specifically toward raising the standard of living for these people. So now we have a company called high land foods. In each bag, there's a bag of the quinoa pops which is what we manufacturer.

>> ESTRELLA CRAMER: Hi, good morning. My name is Estrella Cramer and ordinarily nature is coloring my hair. I'm with UPS and I've been with them for about 27 years now. I started with the business side, the finance, so been involved with business plannings, strategy costing, a lot with international business part of UPS. And then I became a finance mole in marketing, so I went to marketing. I did several stints in new product development and some of our acquisition -- I'm able to work with the team to integrate them with our UPS family. And then the best job came with procurement so I've been with procurement for about five or six years, starting really working with the supplier diversity team and became officially the supplier diversity director about a year and a half ago. This is one of the best jobs that I had in UPS because I did move around in a lot of locations but sometimes I can't think that they pay me for being able to help me with my passion, which is to really help diverse suppliers and make sure they get included in UPS.

>> DR FRED MCKINNEY: Thank you, Estrella. I just want to start with the learning objectives of this session. So, at the end of the -- I think they'll be doing some evaluations and we want to know what you thought and for purposes of improvement next year, perhaps. But the first learning objective is how to promote and sustain business growth. Okay. The second objective is to build meaningful relationships and an effective business support structure. And the third objective is, learn how to apply strategies from the success stories of DOBEs, SDVs, and others.

So those are our objectives and so we're going to begin, and Deb, I'll drive your presentation and you can just give me the sign. It's already up. And I'm not sure if you can see it, though.

>> DEB DAGIT: I'm fine. I've got hard copies. Thank you, Dr. McKinney. Well, I really want to make sure we have lots of time for Q and A, as Dr. McKinney said. But I also want to make this personal because to have a successful business, it really has to be about what makes sense for you. And you have to be

really honest with yourself about what you want and what you're good at and what marketable skills you have. So, I had to start with the fact that I'm 57 and I have a bone condition called osteogenesis imperfecta, which makes your bones brittle. That's why I'm short in stature. I also have non visible, including hearing impairment, PTSD, I won't go over all of it. But overall, when I'm checking a health evaluation whether with a census or at the doctor, I consider myself to be in excellent health and I'm in much more health now than I was when I was working internally. So when I started my business, one of the things that was a priority is not to have a business that interfered with my quality of life.

And as any of us age who have a disability, the aging process combined with your disability, for many of us, anyway, can make things more complicated. So you have to work harder at maintaining excellent health. My guilty pleasure that I have to tell all my clients is that I built an above-ground warm pool in our basement. When you're a little person, only 4 feet tall, you can have an above ground pool in a room the size of a bedroom and you can climb up and into the pool without touching the ceiling tiles. But anyway, on the bottom of the pool is a treadmill and every day at 3:00 when Ellen Degeneres comes on, that's where you're going to find me unless it's an emergency, so they just get used to that.

I am not someone at all comfortable with the idea of selling myself. I am an introvert. Like a lot of introverts I can get in front of a group like this, practice, practice, practice, whether you get the hang of it or not. But I really wanted to not have to sell myself and I'm terrible if anyone asks me to raise funds, I'm not good at that, as a fund raiser, either. But the wisest thing anybody told me is you have to get over it and if you're not willing to market yourself and your company, you're not going to go anywhere.

So when I thought about, what am I going to call my business, it felt like the height of narcissism to call my business Deb Dagit Diversity. It was very uncomfortable. But the reality is I had been a chief diversity officer for 25 years and as the only person leading Diversity for global companies who had a visible disability, everyone knew who I was. So I had to just come to terms with the fact that I probably should call it that so people are quickly find me. So that's part of your personal brand and if you have a strong personal brand, leaning into being willing to use it.

I also used to get really annoyed when suppliers would call me and would start with wanting to know everything I'm doing and then tell me they could help me with all of it. Because I knew that wasn't true. So if you're a supplier, you have to ask

yourself, what am I honest to goodness really good at? And there's a lot of things I could do as a diversity consultant but they're not what I'm good at. So, for instance, I am not an instructional designer. If somebody says, I want you to provide training in diversity and inclusion, because I know other suppliers who are good at that, I'll go get them someone. And oh, by the way. There are things called finders fees, right? So you can do that for other people and they can give you a little cut, right? And you can also subcontract. So sometimes I'll co-facilitate with someone who's a really good trainer where I'm making it customized to the client and they're making it really cool and interactive.

It helps to have an authentic and meaningful testimonials for your business, and remember your website is like your front door. It's like your office. So it helps to invest in a good website. You may not want to do this right out of the chute because you're not sure if your business is going to be successful. You want to hope it is. You want to plan for success. But I know my first year or year and a half, I had a kind of semi do-it-yourself website and when I could see I was going to get to stay as self-employed, I went out and invested in something more professional looking that better reflected on my business. Be honest with your clients about what you don't do, like the example I just gave, and stick to your sweet spot because when you're playing to your strengths and passions, you get repeat business. And a good way that I measure the success of our company -- I say our. It's so funny when you start a small company because you have to name yourself, and it's right away at the bank when you open up your account. Right? And so, I am the president of Deb Dagit Diversity, which is me and my husband, who is the chief operating officer. He calls himself CO2.

In terms of foundational matters, really getting a certification is extremely valuable and the folks at USBLN host monthly teleconference sessions, they do match making sessions like the ones here at the conference. They provide all kinds of advice and mentoring and access to schools like Dr. McKinney's to learn more. When it comes to the financials, how many people in the room are not comfortable doing like profit and loss or balance sheets? Yeah, it's tough. But, you know, the cool thing is there are programs out there. These days, you can Google or YouTube anything and if you really are not good at it at all, fortunately, my husband is pretty good at it, there are people who can help you with it. It's important to get that right because when you go to get certified, whatever certification you're getting, you need a PNL and a balance sheet and if you don't know how to put that together -- I thought it was really

ironic and pretty hilarious that when I was internal I could manage a multimillion dollar budget with 50 employees and when I became me, myself, and I, CO2, I didn't know how to put together a balance sheet.

Next slide, please. The number one question I get when people are starting out a business is, how do you know what to charge? And boy, you know, I hate to tell you this, but it's an "it depends." it depends on your brand and whether or not you are considered at the top of your game or not, and then you could charge similarly to others who play at that level in interprets of skill set. It depends on what the market will bear. You don't want to either under or over price yourself. And you want to be flexible because you're going to be working, hopefully, with everything from small companies to really large global firms and they're going to find out what you charge and you have to be able to be transparent about that. So I explain.

For little companies with little budgets or non-profits or government agencies I have one fee structure and another one for a fortune 500. But there are so many cool ways you could do it. You could do a statement of work that just basically says here are the things we chatted about that were needed and for all of that, this is what I would channel and here are the milestones where we'll get payments. You can say -- one of the things my clients like is I have what I call my hotline. The bat phone. This is where someone in diversity and inclusion is having an existential crisis and wouldn't have been able to predict that so they'll pay me to be on retainer so they can pick up the bat phone and I can help with whatever they need and we don't have any paperwork to do. I already have signed their non disclosure agreement. I already know how things work.

It is really challenging to get to the procurement process and I know Estrella is going to get to that. It gets a little worse every year. These are Reba's and Kelly's services and if you're doing work for a defense contract, you may spend more time in the procurement process that be than you ever did doing whatever they asked you to do. But you just have to get the hang of it and after a few times if you do lots of screen shots and take notes, it will save you a ton of time because they all want the same stuff and then you're not looking it all up again. But to get the hang of that -- and again, if you want, you could partner with somebody to help with you that, you're going to find -- and for those of you already in business, I'll put this in the form of a question. How many of you find that your clients are sometimes hot to trot and other times you can't get them on the phone or email. Quite a few hands, right?

My spring and fall are like, I have to have my bag packed. It's just nuts. But in the summer or winter, nobody get back to

me after they told me they had some kind of urgent project so just get used to it. Don't take it personally and realize that internally they have all kinds of stuff going on and it's not about you. And just use those times to prepare products and tools and things you can roll out that when you get busy you're not going to have time to develop.

And then finally, one trick that I've learned on this slide is that at the end of the year, whatever your client's fiscal year is -- make sure you know what that is -- in the last two months, start reminding them of accounts receivable because it's -- and say it in this way. It's not like you're a collection agency, right? What you want to say is, I know you needed this to hit your budget in this fiscal year. It doesn't look like it got processed so you might want to call somebody to make sure the payment is processed so you'll have the money next year when you need it. They love it when you put it that way. And any time you can put what you're saying to your client from their shoes -- I call it walking in their moccasins, it makes your life a lot easier. And don't be surprised -- I'm going to ask for a show of hands to see how many other people have seen this happen. When you get these calls usually for Thanksgiving for people whose calendar and fiscal year is lined up. And they say, Deb, you're going to think this is a really silly request, but would you bill me now?

They're anticipating they're going to need you next year. They've got a use it or lose it process for your budget. How many of that have had that happen? And every single one calls you like they're the only ones who have this going on. Next chart?

>> So we're not going to go to jail, right?>> DEB DAGIT: No. No. And it's a silly internal norm. I'm

going to get a little faster here because I don't want to use up too much more time and those first two charts were the most important ones but on this, I'll just touch on. You need to leverage your assets and build your brand and that means that especially in the first year or two, at your own expense, you're going to need to get out there to relevant conferences and other places where people see you. And make sure that when someone asks you what you do compared to your competitors, other people who do something similar, that you never bad mouth anybody but you always are very clear about that. And here's a tip for everybody in this room that's a DOBE or thinking about becoming one. In every diversity community, there is a mantra that our community started -- I think it was Cathy Martinez, it's in Wikipedia and our community started it. It's called "not about us without us," and ouch if you're specifically offering services for helping people be more inclusive, if your competitors are not

DOBEs, don't be afraid to say, if you believe from a diversity stand point that you should be hiring companies that employ people with disabilities rather that's you or your staff, that is a differentiator that they need to hear.

Next slide. You need to stay relevant. You cannot rest on your laurels. You need to know what emerging technology is. What's hot. Keep reading all the time. My library got bigger instead of smaller when I stepped away from the corporate world. So I'm always in school even though I'm not in Dr. McKinney's classes because I do not want to become stale now that I'm not doing this internally anymore. You will have to step out of your comfort zone but the cool thing about being external is that if there are things you never liked doing internally, like I did not like giving presentations to the CEO and the board. It was never my thing. It wasn't because it made me nervous, it was because of the whole process of getting into the room and hyper ventilating about whether or not there was the right punctuation point on the right slide. Or are we being sensitive to everybody in the room and what -- it's so funny that companies say, we're getting too politically correct. If you've ever presented in front of a CEO or Board, talk about being overmanaged. By the time you get into the room, you've had many, many sleepless nights and were changing your PowerPoint as you walked up to the podium. So I love not having to do that.

We talked a little bit about collaboration and subcontracting. I want to say something about courage under fire, including friendly fire, and what I mean by that. Unfortunately, and this is true of all diversity communities, but unfortunately, it's also true of ours, and that is, sometimes everybody doesn't play nicely in the sandbox across what Jill Houghton calls the disability industrial complex. And you have to stay above the fray and not get into the wars around, who's aligned with who and who's hiring with who. It is important to have a network. It is important who you know as well as what you know, but try as much as you can to be Switzerland. Don't get into some of the politics and that's staying true to your values around inclusion. And then finally the last chart. This is something my father used to say all the time and probably many of your parents or grandparents told you this.

What goes around, comes around. And what I mean by that is, I offer a lot of free advice. You know how doctors say that when they go to a party or family event, people are showing them a mole and asking, do I need to have this checked out, whatever? Well, when you're in diversity and inclusion, it's the same thing. Wherever you go, people take you aside and want to ask you questions, especially at business meetings. And people who are starting out in business, if they know that you've been doing

okay, want lots of advice. And I have found, it's never a bad idea to be extremely generous with your time and support as if they were a paying client or part of your own staff because when you do that, it will come back. When you pay it forward, it will come back.

And continue to contribute to your community. I got such a kick out of Tony Qualo's comment this morning asking to pay taxes. I've always paid taxes. I started working at 16. I'm one of these crazy people who's not very good at taking vacations. My husband call them my work-cations. But one of the things that's a shock to your system is when you become a small business, those quarterly tax payments. OMG. And it is an honor to do that, but no matter how much it's hard to think about, when I was at all the companies I worked for, they were all united way company companies. It was an automatic deduction out of my paycheck and you didn't even have to think about it. Now I have to think about it and make sure that I am giving back to the causes, and I think that's important in terms of your values and overall emotional health to feel like you're continuing to be that partner.

So I probably said way too much. Thank you for your kind attention.

>> DR FRED MCKINNEY: So I think you got a brief overview of why Deb has been such a leader in the whole area of diversity. Now she's come full circle from the corporate side to work for herself, and we value that leadership and it shows. Thank you very much. So, Jack, you're up next and let me see if I can find your --

>> JACK SMITH: If you don't mind, I'll come up because I can't remember what I did on these slides, so I need to look at them as I go along. (laughter) While he's getting that set up, I'll tell you a little bit about my background. I've been on my home since I was -- on my own since I was 13 years old. I had an automobile accident when I was 16, head first into the back of a logging truck so I lost my left eye and had serious damage to the optic nerve on my right eye so I'm legally blind. But I can see as well as everybody else here, I just see through a little tunnel. So I always like to tell people that because if you come up to me at the conference and you're trying to shake my hand and I'm ignoring you, it's because I don't see your hand.

My wife is very good about giving me these little sign language signs when I'm in a group where I don't see people. So Charlotte International partners is a company we started in 2003 and we really didn't have any money to start this company. I'd been the executive of a company in Virginia, and I'm one of those guys that had a practice wife, and that didn't work out so well. And so I lost a lot of my assets when that was over. So

when we moved from Virginia back to South Carolina to start our business, we had $75,000 profit from the sale of a home. So we rented an office and got telephones and desks and my wife was working with me and we went to work every morning and we didn't really know what we were doing. Because we named the company Charlotte International Partners so we could do anything if the first thing that came along worked for us.

I'd been in the lighting business for about 30 years but I wasn't sure I was going to continue in that. So we started making phone calls. We didn't have a manufacturing facility. We didn't have a sales team. But what we had was the initiative to go out and sell ourselves. So, whenever you're trying to start a company and you're selling a product -- and by the way, how many people in the room sell a product as opposed to a service. Okay. Just a few. Okay. So when you're selling a product, you need to be able to convince people that you can actually produce that product and ship it on time. And so I also needed to have a cash cow and a cash cow is somebody that's going to give you steady business that you can use every single day to develop your company and pay your expenses overhead and everybody should have a cash cow. So we went after JC penny's as our cash cow. The reason we did is because they had 1,100 stores. I figured if I could sell them one light fixture times 1,100 stores, that would put me in business. So I went to JC Penny's and told them about my capabilities and what I could do and that I could manufacturer anything they needed as far as a light fixture. They said, okay, we're going to redo the beauty salon so we'll let you provide three light fixtures for the beauty salon.

So then I went to China, spent time until I found factory that's would work with me so I had them produce these parts and ship them into me and in the evening after we closed office at 5:00, I would assemble light fixtures. So we did that with JC Penney's and soon developed a relationship with them where they gave us another department and another department and another department and in 2010 from amongst more than 5,000 procurement suppliers at JC Penney's, our little company was the procurement supplier of the year

(Applause)Thank you. The following year, they called us in November

and Deb reminded me of this, and they said, we have some money we'd like to spend. Can we make an advance payment on our next year purchases? I said, well, I don't know, that's going to be tough but I guess we can work that out for you. So they wrote us a check for $1.4 million. That was probably the best day of my business life. So, anyway, that's kind of how we got started. And you know, I think when you're a small business person, you need to -- I guess I hit this to advance. Okay. When you're a

small business person, you need to represent yourself honestly but always create a bigger picture because that's who people want to work with. They want to work with people who have capabilities.

So we represented ourselves as being a national manufacturer. We can produce anything. Which we can, because I work with 45 or 50 factories in China that can do this. And this is a lovely picture of Hong Kong at night. So this is really how our business got started. Then in 2014 -- or 2013, actually, my wife was watching this television show called house hunters International. Do you know what that program is? So I'm walking through the house and they're selling a house on the ocean for $189,000. And I thought wow, that's beautiful. Where is that? She said Ecuador. I had no idea where that was so I got my iPad out, started looking for Ecuador. I discovered though were a country that used the US dollar as their currency. They have a very high standard of living but a low cost of living. I thought, they probably have something I can buy cheap and import into the United States and sell high, because that's the primary business I'm in.

So I started researching Ecuador and found this little country that manufactured a compost used in agriculture made out of a plant that floats on a lake, a water hyacinth. It's so rich with nutrients that it can double the yield. In Ecuador, a lot of the fields will get two or three crops instead of one. So I bought it and during one of my trips the young lady I worked with took me into the high Andes mountains up above sea level and we met these quinoa farmers. I didn't even know that what it was. She's telling me it's the most nutritious grain you can get, and so I met these farmers and I found out that they survive on less than $500 a year and to me, that was really kind of staggering. Because I can't imagine how anybody can live on $500 a year. These slides are kind of just showing some products but I'm not going to stick to it.

So anyway, that really impacted me at the time and when I came back to the United States and started looking at quinoa, and it was seven or eight dollars a pound, I thought, wow, there's a little difference between this and $500 a year. I thought, we should start a business to work this out. Most of them are not educated, can't read or write. So we started this company called Highland Farm Foods and we started out bringing our quinoa and we thought everybody would want it. Nobody wanted our quinoa. So we started thinking, what can we do with our quinoa, and we started going with snack foods. I got a call from Google business. We're interested in your quinoa business. Do you have a snack food. My answer when anybody asks me anything is, yes. Tell me what you want.

They said, well we have all these Google kitchens and we want to provide these healthy snacks so I called my friend and I said, go to the grocery store and find all the quinoa snacks can you find and see if any of them taste good. She said, I found several but none of them taste good. But there's one that actually is kind of unique. So we took that product and we hired a food engineer and we revamped it and made it into something much nicer, cleaner, simpler, and tastes good.

So I knew nothing about the food business. Even today, I know nothing about the food business. But I've always leveraged the capability of people in my business and if you want to grow without investing a lot of money, that's the way you do it. You form relationships and alliances with people that are experts in the field and reach out and ask them to help you so we found people that could do the packaging. People that could do the testing, help with importing and do the distribution. When we told them the story, they were even more interested in helping us out. So we went to the fancy food show in New York and showed these quinoa snacks and the reception was overwhelming so now we're faced with another problem. We can't make enough quinoa pops fast enough so we found another manufacturer in Sandinos, California, who makes snack foods for Frito Lay and other companies and they're going to start making these for us in the United States so it's just another way we leverage other people's capabilities to make our company look bigger.

We're probably going to do somewhere in the neighborhood of 22 to $23 million with this product. That's going to help a lot of indigenous people in Ecuador and we're still a small company, I have 25 employees so can you do a lot of things by leveraging other people's capability. One of the things that is so unique -- and I didn't know this but the young lady in Ecuador I worked with, she knew this. You can go on Facebook and target an add on Facebook to a specific zip code and to a specific demographic within that zip code, so our customer is the millennial female, primarily. So when we put our product into the new grocery store, we get the zip codes from those grocery stores and for $25 we do an add on Facebook that targets those people in those specific zip codes. And we get seven or 800 hits on our website whenever we do that. So that's another opportunity to leverage the capability of someone else to make your company more successful. I'm sorry I didn't go along with those slide. There's a package of some of our products and that's the end of that. So thank you very much. It's very difficult to follow Deb Dagit. So

(Applause)>> ESTRELLA CRAMER: Hello. Very adequately explained by my

co-panelists so a lot has been covered. When I go through the

sections we were asked to cover, I will not repeat what's been covered and will just add on to it. So the first part we had was the marketing. So working as a supplier diversity representative for UPS and I am -- as a matter of fact, we have several representatives from other companies that are in my line of business, which is supplier diversity. Certification is key and it gives advantages to a lot of businesses. One, it's the certification that makes us be able to count the spend. And it is very important for companies to reach certain metrics, certain goals, and we are required in our processes to make sure that the diverse suppliers are properly certified so we know it's a legitimate business with what they're saying they're diverse from. The other thing, too, and I think you touched a little bit on it, is when you're a certified business, you get involved with certifying companies or organizations like USBLN. You've got NGLCC, WEBANK, and these sort of organizations offer a lot of development, training, and it serves as a networking tool for all of you to connect with not only the corporate suppliers but also with your peers.

So, that's what I have for the certification and marketing. The other section that we're asked to look into is leadership, technology. My co-panelists talked about the leadership so I would talk a little bit about managing cyber management risks. That's a hot topic. Every time you go out there in the media you see a gambit of things that are happening not only to bigger corporations but even to smaller businesses where their systems get hacked and so forth. So one of the things that is happening right now is that the threat of cyber risk is not only a tech cam matter. It is now what they call social engineering. And what that is is it is easier to manipulate the person's interest, the human interest. How many of you have seen those emails that say click on this like it's coming from one of your friends and all of that? So that is a very effective way that some of the hackers are actually using -- which is through that social engineering aspect of it -- to be able to get into the important data that you have. So the other advantage, too, is if you're able to have a risk management for cyber threats -- and I like the saying where they say, put cyber security on the agenda before it becomes the agenda, right? And, it really can serve as your differentiator when you go to different large companies, especially, because one of the key things that we value is that our partners, our suppliers are very much concerned about cyber security or, you know, securing our data. And that could differentiate you from the other suppliers that are talking to us, and does not really have that on top of their agenda. So it gives us a peace of mind and really shows what you value. The other section that I would like to talk about a little bit is the

finance and budgeting.So aside from all the reasons that we talked about, how

important making sure you have an effective financial management is that when you go for a loan, when you do your certifications, as Deb was saying, you do need a healthy and strong financial management that could be shown in your balance sheets, as well as your PNL. And so the biggest thing is really make sure that you have an effective budget that you can set out and that really helps us in the direction of your business because it really shows you what product you should concentrate on, what your profit and services, and also it's a guide you can look into and make several adjustments as you go along with your business. Right? The other section that I would like to talk about is this notion of getting a joint venture. And that is something that a lot of my partners in supplier diversity as well as the organizations that does certification has been encouraging a lot of the diverse suppliers in small businesses.

So joint venture, really the first step is to look and set your goals and decide what you wanted to get out of it. So once you decide whether you're looking for the goal of leveraging somebody's business that you don't have, that would be -- that would then give you a direction on looking on other businesses that are thinking the same way as you are thinking. So then you can collaborate your efforts and create a joint venture. One of the suggestions really is once you do have an individual business or another business that you're looking to do a joint venture that sometimes it does pay to have legal advice because there are -- it's a legal agreement. You have to cover issues like, what are the goals, the management structure, the roles and responsibilities, the decision making. You have to be clear about both or any of the participants, what their financial obligations are, how you divide your profits, loss, expenses, liabilities.

And then more importantly, how do you resolve disputes because this is kind of like a marriage, kind of like your joint venture so you need to be able to that all in writing. How to divide or have the ownership and perfection of your IP, the intellectual property, and then how do you terminate that joint venture. So those are some of the things that really need to be explored but it is a great avenue to really get that to the next level where you can leverage other businesses by joint venture.

>> DR FRED MCKINNEY: Okay. Well, thank you to the panelists and we're going to open it up to some questions and I'm going to start the questions off and I'm going to take the perspective, perhaps, of a DOBE. And you guys can choose to answer it and we'll have some questions from the audience next. Okay? Can you hear me back there? Okay. If you're in business and you're

trying to sell to a large company, what would you think you should lead with? What is it that you have been successful doing that you could advise the participants or the -- our guests here today, what's most important? What should they do when they are approaching or talking to -- because there's going to be some one on ones at this conference. What's their message?

>> Okay. First you have to know exactly what it is that you do and you have to be able to share that in about 60 seconds. And it can't be like something memorized. It has to be something that is from your heart. Because if it's not sincere and from your heart, if you don't believe it, nobody else is going to believe it either. The other thing I think is important, and I always try to remember this every time I'm making a new presentation, is be humble. Or humble. However you say that word. Be confident but be humble because you're getting ready to talk to a person who probably has a problem that maybe you can solve.

And if you approach it with that kind of an attitude, I'm here to help you, these are the things that I do, and I do these things very well. And now tell me what it is that you're involved with where I can be of assistance. And I generally get very good response from people like that. And I never, ever, ever talk about the competition. I act like I don't even know the competition is out there because it takes all of the time that I have learning and developing my own products and skills, I don't have time to study other people's products and I don't really care about their skills. So, that's how I represent myself and it's worked well for me.

>> DEB DAGIT: So my short speech, and I'm almost always talking to somebody in diversity and inclusion or who got tossed that function for one reason or another and they got voluntold to do it instead they wanted to, so my simple elevator speech is, I offer the practical, just-in-time solutions and tools that I wish had been available to me when I was a sitting chief diversity officer. Works every time. Because I'm telling them, I've been where you're at and I'm not here to sell you a hammer because that's the tool in my tool box and it's my favorite one so you must need that hammer because it's what I want to sell you. And then the other thing I would say is, I totally agree with everything jack said. I do know a little bit about the competition but I avoid discussing it other than the "not about us without us," if it's a disability gig, as I call it. But I would say that the other thing that's important is, emphasize in initial meetings, and Jack was saying this as well, inquiry over advocacy. Listen, listen, listen. Very active listening. Be able to repeat back what you heard in a way that they know you really understood it and that you have what they need. And it

takes like -- you watch them go from feeling really frustrated and worried and stressed out to a big sigh of relief and how soon can we get started? And when that happens, you know you've sealed the deal.

And I want to repeat, and this is the last thing I'll say is, the best measure of whether or not the client was happy is when they come back. And if somebody doesn't come back, find out why because that will help you course-correct if you missed in some way what they needed.

>> ESTRELLA CRAMER: So, yeah, we hear it. But those are very valid points. One thing that I can add is also, like what you said, aside from listening, is really research. Like you need to be able to understand the business so it really is a great day when we -- and my counterparts also tell me about this -- is that when they sit across from a supplier, and that supplier also offers, hey, I understand in the packaging industry that they have -- you know, like that shows you are really very familiar with our industry as well as, you know, what is the latest that's happening. So, that really creates that environment that you are able to help us. And I think you mentioned it already before, the thing never to lead is that, saying, I can do it all. Because that is definitely something that would make us kind of pull back. Because nobody can do it all F.

So what we're more interested in hearing as you lead in is to tell us what differentiates you from other company of similar nature and how can you help us be more competitive in a cost-effective way.

>> DR FRED MCKINNEY: Okay, I saw some hands up for some questions. Please stand up and say your name and company. Yes, sir.

>> Mark Ellison with Gemini incorporated, I'm a manufacturer in aerospace and healthcare -- I'm Mark Elson. Gemini incorporated. I'm packaging design and distribution in the aerospace sector and the healthcare science sector. People think it's an oxy more on. It's actually not. Both of those are very needed. My question -- I've got two strategies. What strategy does the team have dealing with payment options. Every team has dealt with this. I am a scale one acquirer. It seems line procurement has their own division, diversity has their own diverse, and you just can't seem to come together because when people are going from 60 to 90 to 120 days on a small business, you can't afford that. Second is, is there any strategies that you've had where procurement -- diversity hasn't cross-walked with procurement, especially in the RFP process. What I mean by that, is that there's some organizations, in fact that are even here today, where really it's procurement going to market even

though diversity is sitting at the table but they get an override as you would expect. Procurement is buying the product but trying to get that value add conversation when you get rejected on an RFP is very difficult, which comes back to relationships so sorry, I'll shut up.

>> DEB DAGIT: I really would defer to jack and Estrella on this because the way I work is not really fitting your question. It's very much on relationship and I can fly under the radar because of my price point being under that 50K mark and usually I don't have to deal with a lot of that so I want you to get the good answers coming from my colleagues.

>> JACK SMITH: In my lighting business, we get a 50 percent deposit on every single order. We can do that because most everything we produce is custom product. And then we -- depending on the customer, we either get balance before we ship or we give them 30 days if it's a big, nationally-known company. But in the food industry, it's a different story. And so when we're doing in the food industry, because we're talking about big dollars is, we selectively turn our invoices to some different financing companies that do invoice factoring. There's a lot of different kinds of factoring out there. The one that I always try to stay away from is the one where they want to take over all your receivables. We don't do that.

But, we do work with some companies that will let you selectively send them an invoice and they pay you 90 percent of that invoice the following day. So, in a small business, cash flow is extremely important. And they end up getting about three to three and a half percent on that money. We get the remaining 7 percent or so within about 30 to 60 days. But the nice thing about that is that I'm not the guy sitting out there looking at the mail every day to see if 60 days has gone by and I stim haven't been paid yet. And these financial institutions that do this kind of work, they have their own people that will get paid. Without any problems. Because they know how to do that. I don't. I'm not in that business. So that's worked out well for us.

>> ESTRELLA CRAMER: So, for -- and I've heard this from the other companies -- but also for UPS, that is in our procurement, this strategy with regards to payment options are very much part of the contracting process. So, it's key to make sure that in that contracting negotiations that you do understand what you're signing in with what you're giving in as your days of it. Because you can actually negotiate it and say, you know, I can be paid early. They have all this factoring in receivables. It's all really more of a negotiating term for our contracts. And I know that there are several efforts that have been done for small businesses as to fast-tracking the payments, so that's something

that a small business owner as you are would be a good thing to look into that program because we do have some initiatives that are out on that. And the last one, I just want to -- with the crosswalk that you're talking about between procurement and the diversity goals that we have. So one thing that's been very effective, at least for our company, is that if you do have the executive buy-in, it really makes it work.

Because we have our diversity steering committee and we do report directly to the CEO and we have the CEO, CFO, and all of his members in that meeting. Our CPO is there. We're able to really push the agenda of diversity so when it trickles down, and again, it's important, because you can't just have executive buy-in and the middle management is the one where we have the challenges. But it really do help when you have that executive people that you did have to report on a quarterly basis -- like just for our own example, we have to go back to that group again, and they really, you know, the middle management, the buyers and everything with their particular function are very willing to work with us because they know that they'll be highlighted in that meeting. So executive buy-in is kind of key for that.

>> DR FRED MCKINNEY: Sure, yeah I was going to actually add to -- on the payment issue, I know if you are doing business as a small business with the federal government, there is a policy now in place that is -- not an executive order. It was a memorandum of understanding by the Obama administration that was put into place in 2012 that extended what was legislation called PPA which had to do with fast payment for small businesses. The federal government is supposed to pay its bills in 30 days or less. The Obama administration put in place a memorandum that said that if you're a small business doing business with the federal government, you can be paid in 15 days upon submission of an invoice and completion of the work.

We talked earlier about politics and this is where politics is important because that can be changed overnight. And it's important for you to let your legislators know that this is important to small businesses. And so I would think in payment terms is negotiable. That's money my experience as well. And while the relationships are everything, and you want to have the type of relationship where you can have a conversation with your customer that says, you know what, on this deal, I need to have this. And sometimes it works, and sometimes it doesn't, but I think that's where the relationship comes in where you have to have that confidence, in that relationship and what you do, that it's not going to be something that will harm that relationship.

>> Yeah, I have experienced that. (inaudible) But then year 2, 3, 4, and 5, we've been pushed out quite a bit, but I'm still happy --

>> DR FRED MCKINNEY: In my view, it's patently unfair for large companies to put those types of payment terms on small companies given that often times the larger company does have access to capital and they are using the smaller company as its bank. So let's continue. We have a question. My good friend Kimberly Marcus from AARP.

>> Hi, I just wanted to say at AARP, we are not mandated by the federal government, I'm the direct supplier diversity, we're not mandated but we do 15 day payment to anyone who is a certified minority, disadvantage, women owned, we do it because it's the right thing to do because we know that the company is very important so there are companies that as long as we have the paperwork, you're certified, you're paid usually within five to seven days, but no more than 15 days. I just wanted to put that out there.

>> DR FRED MCKINNEY: I also just wanted to take a bit of moderator privilege. I wanted to IP a couple of other people here. Once is my good friend Adriana Soayego from Google and Google and the Tuck School of Business have a wonderful program called digital excellence. It's a three-day program. Unfortunately, it's all sold out. Our next program is going to be in Chicago but that's a program that Tuck coordinates with Google so you're all welcome to look at. I think your Facebook story is phenomenal. That's one of the things we cover at the digital excellence seminar is how businesses can market that using technology and social media because it's a very powerful, and quite frankly, inexpensive way to reach your customers. The other person I wanted to recognize is Paul Ee we. Paul is with Diversity Magazine. You probably recognize his work. He's really been a champion of diversity and all it's aspects. I'm glad to see him here as well. Next question from the audience. Yes, sir. Whoever has the mic has the floor.

>> Thank you. I'm Debbie Grossman, TD Bank. I'm also manager of supplier diversity and I just wanted to add to what some of the panelists were speaking to today which is how do you grow you were business, and when wetback this idea of access to capital, it really is important for all businesses, small and large, quite frankly, and I can't underestimate the importance of your relationship with your banking institution. I think today in this whole world of virtualization and our ability to take pictures of checks to deposit with our phones, we don't get into the bank as often as we used to. Having that relationship with your bank, having them understand had a business you're in, how you get paid, and how to leverage capital you might already have or capital that's invested in accounts payable that might be 60, 30, 90 days out is actually capital you can use to bridge those loans or gaps in your investments so you can pay your employees

and pay your bills while waiting for companies who might not be agreeable to 30 or 15-day payment terms. I would also say that through your relationship with your supplier diversity manager if you're finding those payment terms are getting pushed out, we are there as your advocates many times to helplessen those payment terms for you.

So while we might not be able to hold your hand through the procurement process because of a complicate of interest, we are there. After you win the award, don't just stop utilizing our services. We can sometimes make those calls and pitch on your behalf to say, look, we're talking about a small business. The their capital is very important. It might be typical to do 60 or 90 days with a large company but can we cut it back with this company so I would leverage that relationship as well.

>> For you as a small business owner, it was mentioned earlier the importance of cash flow. Cash flow is more important than profitability. Because a deal might look good on paper but if the cash isn't flowing, it may not be a good deal. So, I mean, I've seen, unfortunately, situations where businesses, diverse businesses have essentially been put out of business because they are successful. So, be very careful in your -- in the excitement of the deal, don't keep your eyes off the important thing, which is cash flow. And that's, again, something that we pay a lot of attention to in our work at Tuck in working with small businesses, is that understanding of all of their financials, but cash flow is probably the most important.

>> Hi, my name is Aaron Sibbleman and I just started new host systems about six months ago, but I've been in the business for 23 years. 1099, working with payers and providers in the government and healthcare, mostly around Medicaid Public Health Systems. Before I was an LOC, I did it on my own and I didn't know about this organization and I didn't say I had a disability, even though it's kind of obvious. I just approached my customers and I got contracts and I kept it rolling for 22 years. Now, when I came here, a whole light has turned on. And my question is, what I'm trying to get my hands around is, how do I let my future clients beyond this seminar here, beyond this convention, how do I let them know I'm a DOBE without, in a very advantageous way. Where's the balance? How do you promote it but not overdo it?

>> DEB DAGIT: I'll start with a couple suggestions and then we can get other's ideas. You can put the USBLN symbol and that you're a DOBE in your email signature. And on your stationary and other things that are just part of the normal correspondence. You can, when you go to conferences, make sure that in your banners or any of the promotional materials make sure that it's clear that you're a DOBE. And I would keep asking other DOBEs at

the conference for their ideas. I tend to take, like you, I have a disability that people discern. And so, if they've met me, then it's kind of a non-issue, just that I do the paperwork. Actually, I'll be honest, I find being woman-owned certified is much harder than being disability-owned because depending on what part of the country you live in, it's a more challenging process in terms of how quickly they get back to you and how customized the services are. So, I ask myself every year, do I really want to go through this again? And then I say, yes, because you are in diversity and you have to walk the talk.

So let me turn over to Jack.>> JACK SMITH: I don't have anything to add. I think that's

exactly right. The only thing that I would say is that, you know, being a disability-owned business enterprise is the last thing I say in a presentation.

>> ESTRELLA CRAMER: That's true point because you never want to lead in with that. It's an additional differentiator but really it's your products and services that should be the highlight.

>> So my comment or slash question is that given the space that most of the disability supplier personnel in room work, a lot of times they're going to ask you if you're certified because they want to know that information, because again, as I mentioned earlier, that's going to go against their goals, their metrics and their spend so I would say a lot of times that's something they mention but a lot of times that may be something they come to you about. I know that you're probably not certified. I run the USBLN. Yes, I'm Cami. Everybody knows Cami. Yes, ask me, but in my experience, they'll come out and ask you because they want to know that information.

>> DEB DAGIT: Well also, just would want to add, if they know you're a well-run business if you got through the certification process. So whether it's women or anything else owned, you have to be pretty buttoned up and running your business in order to get through certification.

>> I would just like to add to that. My name is Dennis Parker. I'm the president of Tech True Up. I find that it's a learning pro and being in DOBE is a benefit to open up doors. I took a journey in order to try to get into AT&T. I'm a certified disabled vet so I went in as a veteran without certification but then I was asked if I would like to participate in their announcements on where they're going to take their company. I went in and I listened to their plans, their goals, and where they will be in five years from now. I took my goals and parallelled that so I could develop my business around AT&T's capabilities. All during that journey, I stayed very, very close to the supplier people. And I learned not only as a disabled vet

but as I became certified as a don't that it really is a great opportunity to market yourself in different ways and being able to go in -- he with were talking about earlier executive buy-ins, well the executives have a commitment but the middle managers are the ones you really have to be able to knock on their door. So that journey goes all along the way and if you have that capability on your signature and email, on your banner here, it just makes it that much easier in order to take that journey but tough build your capabilities around what -- you have to build your capabilities around what your customer is saying.

>> DR FRED MCKINNEY: Thank you for those comments. We have time for one more question, I believe.

>> I'm Cindy Alban from accelerated engraving and signage. I have a manufactured product. And I'm just going to add, certainly, about -- I really don't -- I advertise on my business cards on my website that I'm a DOBE, but where I've -- I bid on projects and I don't even have to say that I'm a disability-owned business. They ask for any certifications. So, I can fill-in, 100 percent women-owned business and my DOBE certification. With task I'm able to get into many government projects like V8 hospitals, et cetera. That's where I show where I'm at so I don't even have to advertise for it and it helps me get there because many people don't have that certification.

>> DR FRED MCKINNEY: Okay. Well I want to thank our panelists, but before we acknowledge that -- let's go ahead and acknowledge it now

(Applause)And I want to thank you guys for your apt attention to our

panelists and participating in this discussion. And I have to tell you what's sticking in my mind, unfortunately, is jack's comment about the practice wife. If I go home and mention that to my wife, I'll become the practice husband at my house. Yeah. I'll have all the problems. But thank you once again. Enjoy. There's a luncheon I know is going to start in a few minutes but I think if you have any questions, the panel is more than happy to entertain some questions so thank you once again and enjoy the rest of your day.

(Session ended at 10:24 a.m. CST)

***This text is being provided in a rough draft format. Communication Access Realtime Translation (CART) is provided in order to facilitate communication accessibility and may not be a totally verbatim record of the proceedings.

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