Running A Business

Is the Government’s Women-Owned Business Policy Reverse Discrimination?

Apr 18, 2011 • 3 min read
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      I recently read an article written by Carol Tice, entitled “Will New SBA Rules Give Women Entrepreneurs Their Due?”

      It’s about the new government ruling offered by the Small Business Administration that went into effect on Feb. 4, 2011. The rule was made for the Women-Owned Small Business Federal Contract Program, which encourages 5% of the yearly awarded government contracts to come from certified, women-owned businesses.

      The administration has been unable to reach that 5% goal in the past, which I think is surprising because according to the 2007 census data, close to 30% of American businesses are owned by women.

      Seems like there’s a need for additional measures included in the ruling.

      The purpose of the Women-Owned Small Business Federal Contracting Program is to enable contracting officers to set aside certain contracts (to be awarded to only women-owned businesses provided they meet the established requirements) for the provision of goods and services to the federal government.

      Why aren’t women getting more contracts?

      Tice said the ruling was patronizing because it sends a message that:

      “women [can] only win federal contracts if they don’t have to compete for them against male-owned businesses.”

      Contracts should go to the company that provides the best proposal, regardless of whether the business is owned by a man or a woman. Gender shouldn’t be addressed or even disclosed when talking about a business entity getting a job done.

      It would seem that if women are not being awarded a proportional amount of contracts, according to the numbers that are applying, the fault may lie in the ability of the female owner to produce a good proposal or be competitive against her male-owned business counterparts.

      However, the need for the ruling suggests there may be a small amount of profiling that occurs, which reduces the chance of a woman-owned business getting the contract.

      Do officials believe there has been discrimination in the past? That would indicate a much larger problem within the administration that requires more action than simply new guidelines.

      Women can only compete against other women

      The second point Tice makes is the ruling pits women against each other. According to the SBA press release “contracting officers are authorized to set aside certain federal contracts if he/she has a reasonable expectation that two or more women-owned businesses will submit proposals.” By denying men-owned firms a chance to apply for the contract, it ensures that the administration will be able to reach its 5% annual goal.

      Is this now reverse discrimination against the male gender? It seems to say: businesses can only compete against other businesses depending on the gender of the person in the seat of CEO.

      This is of course ridiculous. In our open-marketplace, I cannot believe most consumers know or even care about the gender of the person sitting in the top seat of their favorite store. It’s about quality, price, location, convenience, selection, service or product. Not gender.

      And what the proposals themselves? Say two women-owned businesses submit proposals that are inferior to a proposal submitted by a company owned by a man. If the contract has been declared that it must go to a woman, will the administration take one of the inferior proposals, which may mean the wasting of money, time and/or resources?

      This waste seems like a bigger problem than the failure to meet a 5% goal. Again, I think contracts should be awarded on the ability of the company to perform, not on the gender of the CEO.

      In my world, I want to get the customers, the praise, the contract, or the recognition because I have produced a superior product, service, business or experience that warrants the reward. Not because my gender is undeserved and I benefit arbitrarily, regardless of whether I really deserve it. And I don’t believe I am alone in feeling this way.

      What is your opinion?

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