October 18, 2008

Microsoft Vendor Summit and Creative Capitalism

Recently Waverley was invited to become a Microsoft Preferred Vendor (MSVP). This is a big deal for a company our size, especially since our work at Microsoft contributes directly to their software products. Microsoft has about 60,000 vendors, but only 1,000 of them have the Preferred Vendor status.

The list of Preferred Vendors includes software developers like Waverley that are hired to support Microsoft’s supply chain. It also includes all the other ancillary services that a big company purchases, for example security and food concessions.

Like all large companies, Microsoft is always looking to become more efficient in its purchasing. Each year Microsoft purchases about $12 billion of goods and services. Currently 75% of those purchases are funneled through Preferred Vendors. Microsoft is trying to increase that percentage.

Microsoft’s annual vendor summit

Microsoft hosts an annual MSVP summit in Redmond at its impressive corporate campus. I went up to Redmond last week to attend. I was expecting a day of dry presentations, but was pleasantly surprised.

Why? The first surprise was to see the level of effort that Microsoft puts into making vendor relations work. Most of the topics were predictable: what Microsoft expects from vendors, quality initiatives, payment logistics, and training. But I was impressed with the quality of the programs and the obvious desire to make them work for both Microsoft and the vendors.

Bill Gates and creative capitalism

My biggest surprise was to see how Bill Gate’s ideas about philanthropy and sustainability are finding their way into Microsoft’s vendor programs. As a full-time philanthropist Gates has spoken about the need for more integration between philanthropy and business, something he calls “creative capitalism.”

At the summit Microsoft encouraged its vendors to also start thinking about creative capitalism and the responsibility of all companies to think about their obligations to customers, employees, shareholders and the broader community.
The idea of responsibility not just to profitability, but also to customers and employees is not a new one for me. It’s a big part of why we founded Waverley.

But Microsoft’s encouragement to also consider responsibility to the broader community is a compelling idea. As a young and growing company it’s not something we felt we had the resources for. But my day in Redmond made us reconsider. It certainly gave me something to think about on the way home.

Overall, a useful trip.