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Market-Based Solutions to Vital Economic Issues


Kenan Institute 2023 Grand Challenge: Workforce Disrupted
Market-Based Solutions to Vital Economic Issues
Sep 1, 2019

Business Intelligence for Creating an Inclusive Model of Contracting and Procurement in the City of Durham


Gentrifying cities increasingly are adopting inclusive and equitable development policies, strategies, tools, and regulatory practices to minimize, if not altogether eliminate, the demographic and economic dislocations that often accompany their growing attractiveness as ideal places to live, work, and play for a creative class of young people and well-resourced retirees who are predominantly white. Creating greater opportunities for historically under-utilized businesses to grow and prosper through enhanced local government contracting and procurement is one mechanism through which gentrifying cities are trying to generate greater equity and shared prosperity. Specifically, local officials in such cities are moving aggressively to transform their existing procurement systems into fully automated supply chain management systems, with the overarching goal of making their entrepreneurial/ business ecosystems—the major job generators and sources of wealth creation–more transparent, accessible, equitable, and inclusive for diverse suppliers of goods and services.

For cities like Durham that are struggling with how to respond to gentrification-induced demographic and economic dislocations, the concept of an inclusive supply chain management system may be difficult to comprehend. Even in instances where local officials grasp the concept, such a system that requires greater supplier diversity in contracting and procurement may be perceived to be either too onerous or too expensive to implement.

Given this state of affairs, this paper highlights what is known about the current state of supplier diversity, that is, inclusive contracting and procurement through supplier development and supply chain management. More specifically, it explains the rationale behind the current approach to supplier diversity; defines the core characteristics of supply chains and supply change management systems; describes how such systems are developed and the analytical tools that govern how they operate; and identifies the “best in class” third-party supplier diversity management services firms that offer turnkey systems for inclusive sourcing. The paper concludes with a discussion of the advantages of implementing a best in class supplier diversity management program in a gentrifying city like Durham.

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