Purchasing Incentive Program

A I R (Awards Incentive & Recognition) Program

The A I R (Awards Incentive & Recognition) Program is designed to recognize departments and colleges, as well as individuals that demonstrate exemplary efforts in supporting and utilizing Targeted Businesses (women/minority owned firms). Through this program departments and colleges can receive financial rewards based on their ability to aggressively and successfully purchase goods and services from women, minority and disabled owned businesses. Individual staff will also be recognized and rewarded for their work in assisting and creating business opportunities for Targeted Firms.

Goals

Identify measurable results for compliance to the University’s Women Minority Disabled Business Enterprise (WMDBE) program
Reduce product costs to the University through a competitive bidding process
Reward non-traditional purchasing procedures that optimize Women Minority Disabled Business Enterprise (WMDBE) inclusion
Increase Women Minority Disabled Business Enterprise (WMDBE) expenditures to a minimum of 10% of annual University expenditures
Provide assistance and resources to support the Women Minority Disabled Business Enterprise (WMDBE) program as prescribed by the Board of Regent

A I R Award Guidelines

Department & College Awards

Initially $50,000 will be allocated to fund the A I R Program, however, because departments and colleges vary significantly on the type and amount of purchasing activity they may do during any given calendar year, there will be 1st, 2nd, and 3rd tier category awards.

The first tier category award is for $25,000 and will apply to departments/colleges that purchsase $500,000 and above in goods/services.
The second tier category award is for $15,000 and will go to departments/colleges that purchase $100,000 to $500,000 in goods and services.
The third tier category award is for $10,000 and will go to the departments/colleges that purchase $0 to $100,000 in goods and services.

Participating Departments and Colleges will be selected based on their total purchasing/spending activity with Targeted firms for a (12) month period

Individual Awards

Individual awards (plaques) will also be given to recognize the University staff persons (buyers, end users, department heads etc.) who demonstrate outstanding support, commitment, and accountability to the supplier diversity initiative. Awards will also be given to those University vendors and suppliers that utilize or create 2 nd Tier contract opportunities for targeted firms on University related contracts.

Use of Funds

These funds are unrestricted and may be used by the winning departments/college for any purpose they deem appropriate. As an example; departments may choose to use these funds to purchase needed items for their department, for business travel, to supplement staff bonuses/compensation or in support of other business and operational needs.

How Departments & Colleges Participate

Because most of the general buying opportunities flow through Purchasing and are based on the competitive bid process, we recognize that it becomes more difficult for a department/college to choose the vendor they want to utilize. Therefore we encourage departments and colleges to target buying goods and services that do not require assistance from purchasing services. This would involve focusing on purchases under $10,000. These transactions are typically carried out with University purchasing cards or other methods and don’t require authorized users securing purchases under this process to solicit competitive bids or assistance from purchasing services. According to the most recent analysis of purchasing transactions, 1/3 of the purchasing dollars spent in fiscal year 2004 – 2005 were under the $10,000 threshold. It is also reported that 99% of the University purchasing transactions during this same period of time were under the $10,000 limit and amounted to $215 million dollars.

Registration and Training

Departments interested in participating in this program should designate a point person to represent their department. The department designee will be responsible for submitting monthly reports and will be the liaison between The Office for Business and Community Economic Development (OBCED), and the Women Minority Disabled Business Enterprise (WMDBE) suppliers. In addition to the department representative completing the initial training and registration, they will be required to complete a “train the trainer” process for training applicable staff within their department to ensure timely reporting of purchasing activities for their department.

Vendor Resources

Program Measurement

The following process and reports would be used in measuring department / college participation in the Women Minority Disabled Business Enterprise (WMDBE) Incentive program.

1. Utilization forms will be distributed to departments and colleges to help them keep track of expenditures with Targeted firms. These forms must be submitted to BCED monthly. This information should include:

Name and general profile information of the Targeted Business utilized;
Type of work performed or product provided by the Targeted Business; and
Amount of the contract or purchase order

Each quarter BCED receives from Financial Systems Support detailed Women Minority Disabled Business Enterprise (WMDBE) spending, by department / college. Results will be included in University-wide status reports (Dollars & Sense, Emails).

2. Total spending for all participating departments will be totaled at the end of the year to determine winners.

Program Communication

The effective date of the incentive purchasing program will be July 1, 2006. University department heads and all holders of University purchasing cards will be notified of the incentive program including instructions for participation via broadcast e-mail and University publications including Brief and The Minnesota Daily. The following vehicles would be used to communicate the program to the University community.

Monthly or quarterly training workshops will be coordinated in partnership with the purchasing department. BCED will present to each college / department the program specifics through presentation.
Dollars & Sense – The program would be announced in Dollars & Sense and updates would appear quarterly. These update would include year-to-date data on spending by the 5 top departments / colleges.
University Mass E-mail Distribution – In addition to the above vehicles, the University email system would be used to “target” and communicate with specific department / college personnel involved with purchasing decisions.