Managing Automation - September 2007 - (Page 16)

09-07 Q&A Extended Dialogue EXECUTIVE The interview below is an abridged version of a broader conversation with Donald J. Weintritt, Jr., of The Dow Chemical Co. To listen to the full interview, and others in the Executive Q&A Series, visit www.ManagingAutomation.com/execQA Rethinking Supply Chains As Dow Chemical evolves into a more market-facing business, different types of supply chains will be needed to support a changing mix of business. Formed in 1897 as a manufacturer of bleach, The Dow Chemical Co., today a $49 billion corporation doing business in 175 countries, makes a variety of plastics, performance chemicals, hydrocarbons, and energy products. MA recently caught up with Donald J. Weintritt, Jr., global supply chain director of Dow’s Supply Chain Technology and Expertise Center, to discuss the company’s changing supply chain strategy. Q: How is Dow Chemical changing and what is the impact on your supply chain strategy? A: If you think about Dow, historically, you just had kind of a core Dow. In other words, everything was part of Dow, within Dow, controlled by Dow, very North American-centric, which eventually expanded into Europe. But it was very much a geography type of business making a lot of materials with a lot of exports to the rest of the world. “Macro Flows is a 20-year The direction that we’re headed in now is that the look into the demand — the material flow, if you will — businesses themselves are going to take several differin five-year buckets,” says ent views. You’re still going to have a core Dow continDonald Weintritt, Jr. gent. We’re going to have a lot more presence and capacity and joint venture-type arrangements, for instance, around hydrocarbons or feedstock or energy or base chemicals — things where the centers of gravity for manufacturing are shifting. Core Dow will look a lot more like a performance chemical business, and most of the feedstock, hydrocarbons, and energy capacity would be more in the joint venture space. There will be more of these market-facing units where they take products from the rest of the company, put them together in solutions, and sell directly to even retail markets, instead of just other manufacturers, which has been our primary focus. Q: Do you consider these market-facing units to have their own distinct supply chains or are they at a data level all integrated at some point? A: I think they’re going to be hybrids, to be honest with you. I think they’ll be integrated back through the chemical envelopes into the different parts of Dow. You might actually form some supply chains that don’t exist right now. You may have to build some new capabilities and some new channels to market that we don’t have currently. Q: It almost sounds like a multiplicity of supply chains serving different business needs. A: Certainly you’re going to have different supply chains in the sense that some will be kind of the traditional, push production forecast type. As you move more toward the performance chemicals and market-facing units, you transition more into state-of-the-art supply chains. So you have different types. There are low-velocity and high-velocity supply chains; there are simple, large-volume movements; there are complex supply chains, maybe with packaging and blending and formulation, and things like that. So as we move in more of that direction, the Dow supply chains start looking more like some of the consumer product companies. Q: Is it part of the strategy to try to manage these on common technological platforms or is each customer-facing unit or other business unit free to pick its own platform? A: I think there are going to be common technologies, and then there’ll probably be some unique technologies. Of course, we already have that in Dow now. For us, Most Effective Technology (MET) is kind of a combination of the work processes and then the enabling technologies or Photo courtesy: Dow Chemical Co. September 16 2007 http://www.ManagingAutomation.com/execQA

Table of Contents Feed for the Digital Edition of Managing Automation - September 2007

Contents Take 1 Europe’s Automation Chiefs Upbeat on ’08 Business Prospects Vendor Coalition Pushes Human Element of SOA Wireless: Users Still Approaching with Caution One Year Later, IBM Shows Plan for MRO’s Maximo Study: More Work Needed to Lure Next-Gen Talent Executive Q&A Notes Cover Story: 2008 Companies to Watch Special Report: The 2007 Progressive Manufacturing High Achievers Progressive Manufacturer of the Year Business Model Mastery Innovation Mastery Customer Mastery Supply Network Mastery Data & Integration Mastery Education & Training Mastery Operational Excellence Mastery Leadership Mastery Transformation: Orchestrating the Multi-Tier Supply Network Integration: The Timeless Quest for Accurate Data Industries: Maintenance No Longer on Schedule Product Scan Advertiser Index Next

Managing Automation - September 2007

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