Since the 1980s, certification programs for small businesses owned by women and other minorities have helped drive economic inclusion by creating new opportunities in both the public and private sector.
Shifting attitudes and the rollback of DEI (diversity, equity and inclusion) programs, including supplier diversity targets, in the federal government and at major corporations across the country could be reason to question the future utility of certifications like WBE (Women Business Enterprise), but leaders and businesses say it remains a valuable access point and marketing tool.
Over the past six months, the number of woman-owned businesses in Wisconsin certified through the Women’s Business Enterprise National Council increased 8%, from 195 in December to 211 in June. That total is up 54% from 2017, according to the Women’s Business Development Center, a regional partner organization of WBENC. There are roughly 2,500 certified WBEs across WBDC’s nine-state Midwest territory.
“In spite of the noise, we’re still continuing to certify, and it still is seen as value,” said Erica Kuhlmann, president and chief executive officer of WBDC, headquartered in Chicago.
The organization expects corporations, especially, to remain engaged in building a diverse supply chain – just with new terminology and less emphasis on “diverse spend” and quotas. The focus will now be more on investing in the communities they operate in by sourcing from local and/or small businesses, said Kuhlmann.
But those local and small businesses – regardless of who owns them – still need to be located and vetted, which is where certifying bodies like WBENC come in. In order to obtain a certification, businesses must meet certain criteria and then complete a documentation and site visit process to verify ownership, financial structure, personnel and governance.
That process is valuable in and of itself, says Adonica Randall, president and CEO of Pewaukee-based Abaxent LLC.
“You want viable, reliable, real businesses, and the certifications say you are that,” said Randall, who founded the technology solutions provider in 2002. “So those organizations still do the corporations a solid by doing all of that work and saying here’s our plate of valid, whatever they are, ready to go.”
Abaxent has 13 different local and national certifications, including WBE, Woman Owned Small Business, Minority Business Enterprise and City of Milwaukee Small Business Enterprise. The introductions it got from its network of certifying bodies helped open the door to a whole new segment of business that ultimately set the company down a path it wouldn’t have considered otherwise.
The company was contracted by Johnson Controls for its massive network technology project at Fiserv Forum. JCI needed a diversity partner and knew Abaxent through its membership in the National Minority Supplier Development Council, through which Abaxent is certified.
Abaxent’s work for JCI included the installation of LED display panels above the seating bowl and hundreds of wi-fi access points throughout the arena as well as a host of other project components it was asked to take on along the way.
“We started off with a very tiny piece of that business … and we ended up with close to 10 times the amount of the money we started with by the time that project was up,” said Randall.
That was Abaxent’s first foray into the construction business segment – and the first of now 15 construction projects it’s worked on since.
Applying for certifications was one of the first things Jean Marie Thiel did when she launched West Bend-based mechanical contracting firm Belonger Corp. in 2000.
Within the company’s first nine weeks, Thiel had filed for every DBE, MBE and WBE certification available, including locally, regionally, nationally. She even submitted waivers for those accreditations that required a minimum of two years in business.
Thiel wanted to make sure Belonger had a leg to stand on as it broke into any given geographic market – even if it wasn’t yet clear which markets that would be.
“Because we were a startup company, because we were a small business, there’s nothing more than market entrance, that’s what you’re trying to do … I saw the certifications as a leverage, as a way to push myself up and against, let’s say, the people that had been there for years,” she said.
Belonger has renewed its WBE and other certifications annually since its founding. Some years, there’s no impact on the company’s total revenue – usually as a result of the kinds of projects it pursued that particular year – but the certifications have still proved their value. Thiel says they serve as a “legitimizer” of how Belonger markets itself.
“Not every business that’s quoting this job and I’m competing against is going through the same background and informational screening that I had to go through,” she said. “In order to have (certain certifications), you have to show credibility, financial strength, trust in lending, historical background, and I don’t necessarily know everybody that goes into business or competes in business or is trying to drive a sale is really put through the same scrutiny as a company that is certified.”
In the company’s infancy, certifications helped Belonger gain entry to markets and business opportunities that may have otherwise been out of reach. Twenty-five years later, the company is reaping the benefits of those early inroads, with a heavy-hitting client list and a project portfolio spanning 19 states and Portugal.
Belonger holds multi-year contracts with the federal government and has worked on numerous notable projects throughout Wisconsin, including two major projects currently under construction in downtown Milwaukee: Northwestern Mutual’s North Office Building reconstruction and the Milwaukee Public Museum’s new home (to be known as the Nature & Culture Museum of Wisconsin). Belonger and joint partner Grunau Company are the lead HVAC subcontractors for the Northwestern Mutual project under general contractors Gilbane and CG Schmidt.
“We created a team where the woman-owned business, that diverse business, is a lead, and we are on the project executing a significant amount of the work. I don’t think that would have transpired if we weren’t in a position to leverage our certifications,” Thiel said.
She emphasized that while certifications are an added attribute, they’re not – and have never been – the “be all end all” for profitability; certified businesses still need to sharpen their competitive edge.
“Quality and price still run the show,” said Thiel.
