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Supplier Diversity Works! A Few Success Stories Indiana Energy Association Supplier Diversity Committee.

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Presentation on theme: "Supplier Diversity Works! A Few Success Stories Indiana Energy Association Supplier Diversity Committee."— Presentation transcript:

1 Supplier Diversity Works! A Few Success Stories Indiana Energy Association Supplier Diversity Committee

2 Mission Statement: The mission of this committee is to exchange ideas and share information to influence diversity issues. Purpose Statement: The goal of the IEA Supplier Diversity Committee shall be to provide a forum for member companies to exchange ideas and share information to advance company and association goals with respect to diversity issues. To further achieve this goal, the committee members shall seek opportunities to encourage the development and utilization of viable, competitive Minority-Owned, Women-Owned, Small, Small Disadvantaged, Veteran-Owned, Service Disabled Veteran-Owned, and Historically Underutilized Business Zone (HUBZone) businesses in such a way that reflects the diversity of member company customer bases. The committee will undertake these efforts recognizing the importance of key elements of the "Total Cost Equation" and the balance of a diversified supply chain. Supplier Diversity Works!

3 Current IEA Member Companies American Electric Power (AEP) Indianapolis Power & Light Company Citizens Gas & Coke Duke Energy NiSource Vectren

4 Supplier Diversity Works! Indiana Energy Associations Supplier Diversity Committee Ohio GATE (Gaining Access Through Economics) New Jersey Supplier Diversity Development Council California Utility Diversity Council ChairpersonEllis Redd Vectren Energy Chad Heyman FirstEnergy Corp Toby Stanislaw FirstEnergy Corp Shawn Ferrar Sempra Energy Commission ContactThe IEA and its participating companies are in constant contact with the commission Yes-Commissioners Lemmie and Mason Yes-Commissioner, Jean Fox Yes – Commissioner Michael Peevey Revenue threshold for regulated Utility members None – open to all IEA members, which includes the bulk of regulated energy suppliers $10M – Regulated Gas, Electric, Telecom & Water $ 5M- Regulated Gas, Electric, Telecom & Cable $25M – Regulated Gas, Electric & Telecom Commission OversightWe will provide information informally on an as needed basis Yes Yes – Public Order passed Annual Program Assessment & Reporting to the Commission We will meet informally with the IURC on an as needed basis In progress- voluntary participation Yes - voluntaryYes - required Sharing of Supplier data and Best Practices Yes Outreach Events to Support Inclusion Yes Adheres to UMAP Standards Yes

5 Supplier Diversity Works! In the fall of 2004, Utility representatives from across the state were called together at the request of IEA leadership to discuss minority business development within the industry. Under the oversight of the IEA, the group quickly organized to provide a proactive vision for Indiana that: Responds to Resolution advanced by State Representative Bill Crawford, who has declared our program a model for the rest of the country. Exceeds many NARUC/UMAP Standards Aligns with Minority Business Development Initiatives being championed by the Governor, Legislature and others throughout the state Builds upon Successful Economic Development Models utilized in other cities Provides a platform for sharing Best Practices in Supplier Diversity Gained Multi-Utility buy-in of IEA goals IEA Vice President, Stan Pinegar IEA President, Ed Simcox

6 Supplier Diversity Works! IURC Commissioner David Hadley presents the IEA Supplier Diversity Committee Chair (Ellis Redd-Vectren) with an Official letter of Recognition The Commission…recognizes that this Committee builds upon the successful Economic Development Models utilized…aligned with Minority Business Development initiatives…championed by the Governor, Legislature and others throughout the state…have met or exceeded each of these standards.

7 Success Highlights Tapping into a Diversified Supply Base Recognizing Business Scalability An Innovative Business Model Filling a Niche Supplier Diversity Works! Thinking out of the Box

8 Tapping into a Diversified Supply Base Proliance Recently added diverse natural gas suppliers (April 2007) – Choice Energy (MBE) – Promet Energy (MBE) – Walden Energy (WBE, Native American) Discussing internal Proliance goals Discussing Potential Contract Terms Included on recent Citizens Gas RFP Vectren Natural Gas RFP upcoming Supplier Diversity Works!

9 Recognizing Business Scalability Hightowers Petroleum – Hightowers Petroleum Co. is a “Licensed Motor Fuel Dealer” providing complete Fluid Management Solutions by supplying gasoline and diesel fuel, throughout the United States. Hightowers also sells branded and unbranded lubricants, oils, greases, bottle gases, and specialty chemicals on a national basis. Along with the ability to supply tanks, dispensers, monitoring equipment and transportation of fuel, the company also focuses on meeting the customer’s total Petroleum need. In 2006 Hightowers Petroleum was selected as the sole source provider for all of Duke Energy. Future site visits by other Indiana utilities are being discussed and planned. Supplier Diversity Works!

10 Recognizing Business Scalability Ability to integrate fuel management; procurement and payment by single sourcing our fuel spend using an alliance agreement with HPC. The rationale for this strategy has resulted in cost savings related to a number of internal process changes. HPC has formed an alliance with TransMontaigne, another fuel chain supply management company that has national presence, strengthening their position. Strategy resulted in better administration and management of overall fuel needs, the ability to aggregate demand Helps Duke Energy understand the “big picture” market conditions. Supplier Diversity Works!

11 An Innovative Business Model Pillow Express Logistics – A successful business model that employs independent contractors (micro businesses). If this business model works for delivery services, why not meter reading? In 2006 Pillow Utilities was the winning bidder to read approximately 285,000 meters for Vectren in the state of Indiana. With this scalable business model, each contract meter reader acts as an independently owned “micro business”. Contractors are rewarded for accurate reads and penalized for inaccurate reads. Each has the option of carrying his/her own insurance. In many cases, insurance is already carried by a spouse. This type of business has traditionally been handled internally by the utility or a non-minority third party business. This has resulted in employment for 34 persons. Supplier Diversity Works!

12 An Innovative Business Model Flexible Hours – Work around your own schedule Feeds Entrepreneurial Spirit w/in the state – you own your company Being You Own Boss – the President is you Being a Customer Service Rep – Every stop you make is for a special customer Having a Rolling Office – what better view could you ask for Making Lunch Plans – take lunch when you need to Being the Envy of your Friends – they still ask to break, you just decide when… Supplier Diversity Works!

13 An Innovative Business Model Ratepayer Benefits – Allows utility to concentrate on core business functions. Economic Benefits w/in the state - Each Independent contractor empowered economically. Views him/herself as a micro business. Increased work ethic/Quality -Several readers have never had any misreads and very few can’t reads. Independent Contractors responsible misread and skipped meter penalties. Incentives for Accurate Reads. Meter Reader of the Month Award ($50 Gas Card) Contractor Flexibility –I.C.’s work together, “Trade Off” work with each other to accommodate their personal schedules or in cases of emergencies. Supplier Diversity Works!

14 Finding a Niche ARMADA is a world-class, comprehensive risk mitigation and security solutions provider. As represented in our logo, ARMADA provides four primary capabilities which include; Asset Protection, Personnel Security, Information Protection, and Consulting and Training Services. ARMADA will help you navigate your way to appropriate and cost effective solutions. ARMADA is a Service-Disabled, Veteran-Owned, Small Business. In 2007 ARMADA was the successful bidder to provide subject matter expert professionals to work with selected AEP Team Members to customize three levels of workplace violence awareness and prevention training courses. Supplier Diversity Works!

15 Finding a Niche Community Representation - Armada has a local presence in the AEP communities and brings that personal insight to assist in assessing potential workplace violence threats. Flexible - Has the ability to customize to AEP requirements and concerns to meet the vast needs of employees and raises management awareness at all levels and locations. Customer Focused – Integrates the objectives with the AEP team to ensure security and risk mitigation solutions required for AEP to be positioned to properly recognize and manage hostile or potentially violent situations. Safety - This relationship will support AEP’s Safety initiative to ensure that employees return safely home at the end of the work day.

16 Finding a Niche IEI Financial Services, LLC provides business process outsourcing in the discipline of customer management. We focus solely on the public utilities and energy services market space allowing us to concentrate our knowledge, efforts and talents on services unique to this industry and their customers. Furthermore, we believe this approach allows us to create manageable and sustained growth while providing appropriate financial returns to our investors and partners. IEI Financial Services, LLC is officially certified as a minority-owned business enterprise in the state of Indiana. The company successfully bid and won Vectren’s credit/collection business. Recently IEI formed a strategic partnership with Transactis to introduce secure e-mail e-billing services to supplement its IEI Customer Management Services portfolio. Supplier Diversity Works!

17 Finding a Niche Experts in the that industry – Collections is what IEI does. This allows Vectren to concentrate on core business functions. Not diluted on peripheral business functions such as collections. Flexibility – IEI has the ability to adapt to specific utility needs. Partnership Leveraging – New partnership with Transactis is an example of the firm’s ability to “bolt on” additional expertise based on industry needs.

18 Supplier Diversity Works! Current IEA Member Companies American Electric Power (AEP) Indianapolis Power & Light Company Citizens Gas & Coke Duke Energy NiSource Vectren

19 Supplier Diversity Works! The Indiana Energy Association Supplier Diversity Committee Thanks You!

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