Managing Automation - September 2007 - (Page 17)

systems and capabilities that go along with it. For instance, all of Dow is on SAP. But we’re also using internal solutions at this point. Q: Dow has undertaken a project it calls Macro Flows. What is this project all about? A: Macro Flows is a 20-year look into the demand — the material flows, if you will — in five-year buckets. Where are the sales going to be? It takes the business intelligence data and puts it together with some of the external macro economic data on how the markets are growing and which ones are expected to grow at what pace. You get kind of a check of what the internal business intelligence is versus what the external people are saying. Q: Do you go as far as trying to model how these trends will affect supply chain strategy? A: Yes, that’s exactly the point. What you want to do — the payback for this — is you’re primarily avoiding cost in the design or the operation of these future supply chain channels. The design and modification of the supply chain has to bring in all the elements of supply chain unit costs, the customer service levels that you’re trying to meet, what’s the capital investment in both the fixed assets and the inventory that you’re trying to target. You look at integration of these new business models and ventures, and then the network complexity that results from that, and then what’s the product mix and the customer mix. There’s a lot of stuff that goes into this model, so, yeah, it’s a fairly complicated thing. We’ve been working on it for a number of months now. Q: That’s a fascinating project. I’ve rarely heard of a company trying to look out that far. A: Well, I’ve got to be honest with you — I feel real good about the 2011 number and I feel a little less good about the 2016 number, but I still feel pretty good about that one because I feel like you can predict growth and also the building of our new assets pretty accurately out about 10 years. The 15- and the 20-year, in my mind, are really more of an indicator of where we want to head. If you think about what we’re doing, we’re doing a mass balance on the plant. I know that sounds kind of like Big Brother stuff, but really that is what it is. As new capacity comes online to meet growth and it changes the flows of materials around the world for us, it’s like squeezing a balloon: If you increase it here, then you decrease it somewhere else, and you’re into optimizing asset utilization on a global basis instead of a site basis, which has been kind of the way chemical plants were run in the past. Q: When you look out across the time frame of the Macro Flows project, what kinds of technological capabilities are you looking for that, perhaps, you don’t have right now? A: Well, for one thing, something that we’re already doing is what we call the Next Enterprise Architecture (NEA) project. So we’re going to need — Dow was one of the original adopters of SAP, so we’re actually still on R/2 — to upgrade to a more sophisticated information system. If you think about some of these joint ventures, for instance, some of those are going to have a certain amount of segregation and separation from the mother ship, like financial information. We need the ability to run Dow as a global enterprise but keep it segmented and segregated where necessary. So the NEA project is a big project for us over the next five, six, seven years, to migrate us to this new architecture. Q: Is it going to be based on the enterprise services architecture idea from SAP? A: Yes, SOA: services-oriented architecture. Q: Do you see SOA as the architecture going forward? A: I think so. If all of these things — and I’m not an SAP guy — are NetWeaver-compliant and if they all have the right portal structures so that you can plug and play different solutions into your architecture, then that gives you a lot more flexibility moving forward to either use best-in-class solutions or the one that’s most effective for you. The advantage that I see in SOA over what we have currently is that it is pretty flexible when it comes to either taking new things into the system or taking things out and replacing them with new solutions. I think it is the right direction to go. Q: I would imagine, too, that you must be thinking about what data security means in a global extended supply chain. A: Oh, yeah. Dow has something like — is it 25,000 cyber-attacks a day? Q: Twenty-five thousand what? A: Cyber attacks, people trying to get into our systems one way or another. Some of them are pretty innocuous, like the junk mail stuff, but others certainly are not. So, yeah, protection of information — as you create these more sophisticated information systems and you have more and more information available — becomes more and more important. — David R. Brousell September 2007 17

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

For optimal viewing of this digital publication, please enable JavaScript and then refresh the page. If you would like to try to load the digital publication without using Flash Player detection, please click here.