Johnson Controls Targets $1 Billion in Purchases From Diverse Suppliers Within Two Years

As a Recognized Leader in Minority Supplier Development, Firm Expands Its
Supplier Diversity Efforts, Pledges More Opportunity

    PLYMOUTH, Mich., July 10 By the year 2003, Johnson
Controls plans to purchase $1 billion in goods and services from
diverse suppliers, including companies owned by minorities and women. Senior
officials at the company outlined their new procurement targets and strategies
at a Diversity Business Summit that was held in the Detroit area in late June.
    "This significant financial goal -- and our expanded efforts to include a
wider range of diverse suppliers in our business success -- represents major
steps forward for our company," said Larry Alles, Johnson Controls' vice
president and general manager of purchasing worldwide.
    As a global market leader in automotive interior systems, automotive
batteries, facility management and control systems, Johnson Controls bought
goods and service valued at more than $465 million from diverse suppliers in
fiscal-year 2000. This figure is expected to increase to more than
$500 million in 2001.
    Johnson Controls has intensified its development efforts with diverse
sources of supply as a key method to gain competitive advantages throughout
its automotive and controls businesses. It currently has more than 900 diverse
suppliers corporate-wide.
    "Increasingly, diversity initiatives at leading firms like Johnson
Controls are helping businesses win and retain new customers, and reinforce
brand loyalty," said Alles.
    Within the Diversity Supplier Business Development model at Johnson
Controls, "diverse" suppliers include companies that are owned by minorities,
women or veterans -- and those that are designated by government agencies as
small businesses or disadvantaged businesses.
    At the two-day event on June 21-22, executives from Johnson Controls
reviewed their strategic approaches for accomplishing the two-year, $1 billion
diversity purchasing goal. Participants also included experts in capital
formation, ethnic market trends, and growth strategies for minority-owned
companies. Discussions centered on the key tools Johnson Controls and its
suppliers will apply to reach diversity purchasing goals, including
divestitures, mergers and acquisitions, and joint ventures.
    The meeting was led by Reginald Layton, who was named director of
Diversity Supplier Business Development for Johnson Controls last fall. He
previously served as minority business development manager for the company's
automotive division.
    Other diversity procurement leaders for the company include Shelia Hill
and Titus Martin. Hill recently joined the company's Controls Group as
diversity supplier business development manager. In this role, she is
mobilizing and strengthening the unit's diversity supplier strategy. Martin
serves as minority procurement specialist for Johnson Controls' automotive
unit. He leads a nationwide effort designed to strengthen the diversity
supplier programs of Johnson Controls' key suppliers.
    In recent months, Layton and his colleagues at the company have worked to
unify, strengthen and expand a corporate-wide, diversity supplier strategy.
With its $1 billion procurement goal, Johnson Controls has pledged to ...

    -- Ensure that all results from diversity supplier efforts are reported
        directly to the company's Office of the Chief Executive Officer;
    -- Include diverse suppliers in divestitures, lead supplier arrangements,
        joint ventures and strategic alliances;
    -- Implement standardized internal processes - throughout the company
        -- for recruiting, training and utilizing diverse suppliers
        nationwide;
    -- Expand a successful mentor/protege program for customers and key
        suppliers throughout the United States;
    -- Adopt Web-based systems to provide business opportunities to diverse
        suppliers, measure performance, and promote diversity-oriented
        business solutions to customers; and,
    -- Strengthen mandates for existing Johnson Controls suppliers that
        require them to offer solutions supporting supplier diversity, as a
        condition of doing business with the company.

    In recent years, Johnson Controls has been recognized as an industry
leader in diversity and in supporting minority-owned companies. Last November,
the company was honored as "Corporation of the Year" by the Michigan Minority
Business Development Council (MMBDC) for the fourth time in five years. MMBDC,
a voluntary organization with more than 2,000 members, works to create links
between major corporations and minority businesses.
    Johnson Controls, Inc. is a global leader in automotive systems and
facility management and control. In the automotive market, it is a major
supplier of seating and interior systems, and batteries. For non-residential
facilities, Johnson Controls provides building control systems and services,
energy management and integrated facility management. Johnson Controls,
founded in 1885, has headquarters in Milwaukee, Wisconsin. Its sales for 2000
totaled U.S.$17.1 billion.