Supplier Diversity Programs and their Impact on Purchasing Agent Negotiation Strategies: A Role Theoretic Model

Government contracting and procurement practices that include preference programs for women and minority-owned business enterprises (WMBE) and supplier diversity initiatives in industry are commonplace in the U.S. and have sprung up in other nations like Australia and Canada, but with a focus on aboriginal business enterprises (ABE). An interesting incongruity exists however. Although WMBE procurement preference and supplier diversity programs are commonplace in the U.S. and articles about these efforts regularly appear in the business press and trade publications, this topic has received scant attention in the academic literature (Carter, Auskalnis & Ketchum 1999; Krause, Ragatz & Hughley 1999). Within this limited literature there are several reports that many of these programs have produced disappointing results and frustration (Bates 1985; Bates & Williams 1996; Dollinger & Daily 1989; Pearson, Fawcett & Cooper 1993; Singleton 1995). Among these critical studies, several common themes can be noted. Many have reported that WMBEs face impediments to success that are structural (e.g., firm size, access to financing) and communications-related (e.g., inadequate access to bid requests, failure to disseminate information on WMBEs to purchasing staff). Other studies have noted impediments that are more related to the

social context

. These include findings of the perceived difficulty by WMBEs in developing strong buyer-supplier relationships, opportunistic behavior by purchasing agents, and the sometime hostile environments encountered (Dollinger & Daily 1989; Pearson, Fawcett & Cooper 1993).