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The Executive Management Team at Pinnacle West has integrated supplier diversity and development into its corporate commitments and overall business strategy. APS, Pinnacle West’s largest affiliate, is primarily responsible for implementing supplier diversity best practices into its supply-chain-management objectives.
The goal of the Supplier Diversity and Development Team (SDD) is to maximize procurement opportunities for certified Diverse Businesses within APS’ business units. SDD accomplishes this by identifying certified and qualified suppliers that are capable of providing the highest quality goods and services to a challenging, innovative and safety conscious industry. SDD creates opportunities for diverse businesses to develop strategic relationships and provide APS with highly competitively goods and services.
As a major purchaser of goods and services, APS has an opportunity to help diverse businesses grow and strengthen the foundations of our local economy. This impact extends to companies from which we purchase the goods and services essential to operations. This growth contributes to job development, neighborhood stabilization and regional economic expansion. A diverse supplier base not only provides economic vitality to the communities in which we live and serve, but also adds value to APS and helps to enhance our role as a community leader.
APS established aggressive spending targets for its individual business units in 2008. The business units were assigned two targets, a minimum and a stretch target. These business unit targets roll-up to company-wide minimum and stretch targets of $47 million and $52 million.
Through hard work and commitment to supplier diversity best practices, APS achieved $72.6 million in total direct spending with certified minority- and women-owned businesses in 2008. This amount eclipsed the stretch target by more than $20 million. SDD reported an additional $61.5 million in second tier spending with diverse businesses.
2008 Highlights:
- APS received the Corporation of the Year Award by the Grand Canyon Minority Supplier Development Council at its 14th Annual Awards Banquet for its outstanding achievements in the area of supplier diversity.
- APS sponsored AzBizGreen, the nation’s first global sustainability conference focused on diverse business opportunities in the sustainability arena.
- SDD hosted two Emerging Markets Leadership Forums that foster a continuing dialogue of critical issues between leaders of the diverse business organizations (i.e., ethnic chambers of commerce, advocacy groups, certification agencies) and APS/Pinnacle West Executive Leadership.
- An Emerging Markets Procurement Roundtable (EMPR) was hosted by the Supplier Diversity and Development (SDD) department, bringing together 36 certified diverse suppliers with APS buyers and key decision-makers to conduct 65 separate 20-minute one-on-one interviews, all within a span of two hours. The key was to explore procurement opportunities within the various APS business units. SDD also co-hosted "Buy Yuma" an event where regional diverse businesses where given the opportunity to meet with local purchasing organizations in order to promote mutually beneficial business opportunities.
- Edison Electrical Institute (EEI) awarded APS the privilege of hosting the 26th Annual Supplier Diversity Conference in 2009. The conference is the premier event for all shareholder-owned electric companies that address issues related to supplier diversity.
 The APS Academy for the Advancement of Small, Minority and Women Owned Enterprises (AAAME) is a two-year business mentoring program designed, sponsored and administered by Arizona Public Service.
AAAME CEOs meet twice a month as a group, once a month with their assigned advisors and once a month with the AAAME director. Since 1997, 130 small businesses in the Phoenix-metro area have attended business training classes, built networks, developed resources and met with individual advisors all geared toward assisting them in reaching their next level of business success.
This focused and integrated mentoring has resulted in 93 AAAME graduates, with about 30 companies currently in some phase of the AAAME process. All of these businesses have gained knowledge, support, insight, resources and skills that have allowed them to succeed and thrive in their chosen business. Many of the AAAME companies have increased their revenues and net profits, increased their workforce, strengthened their market position and increased their business space which adds to the economic impact to the area. In addition, several AAAME companies have been recognized for their achievements through various award programs.
The AAAME program includes the following elements:
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It is a two-year commitment.
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There is no cost to the AAAME participant.
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It utilizes the resources of several community based organizations as well as individuals who contribute to small business.
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It is a combination of classroom training, group projects and individualized company action plans and meetings.
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It is a personalized approach toward mentoring which holds the business owner accountable for his or her own success.
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There is a continual assessment of the AAAME participant’s implementation of the program elements as it relates to the two-year business targets.
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It is peer-to-peer mentoring via the CEO twice-a-month meetings.
While these factors are unique and valued in the community, AAAME is really about the successful implementation of solid business practices, utilizing a wide variety of delivery methods and the continual assessment of each AAAME participant’s progress in the program.
Click here for more information on our Supplier Diversity and AAAME programs.
The EHS Audit Group performs audits of all vendors that provide waste disposal, recycling activities and EHS services to company facilities. This program evaluates our vendors' facility operations, environmental management systems and financial strength in order to minimize short- and long-term liability caused by vendor actions or omissions. The audits also ensure that our waste materials are being properly managed once they leave our facilities. Thirty-five vendor audits were completed in 2008, including 20 audits of treatment, storage and disposal facilities, seven audits of recyclers, two audits of laboratories, and five audits of EHS service providers and vendors.
Pinnacle West belongs to the Joint Utility Vendor Audit Consortium (JUVAC), CHWMEG Consortium and the Desert Utility Vendor Audit Team (DUVAT). The consortiums are made up of various organizations or partnerships that conduct vendor audits and make them available to their members. Participation in these consortiums helps to leverage auditing resources and performance.
Pinnacle West also employs a contractor safety program which communicates the minimal requirements we expect of our contractors in terms of environmental compliance and employee safety. This program is available to the public online.
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