DOW Chemicals' Customer Centric Business Strategy (Page 2)

Abstract

This case discusses the customer-centric e-business strategy of Dow Chemicals (Dow), the leading chemicals and allied products company in the world. It examines the way in which Dow focused on providing better customer service by proactively using IT/Internet enabled technologies. The case describes the various IT initiatives of Dow including MyAccount@Dow, Elemica and DowNET to improve customer satisfaction. The benefits Dow derived from these IT initiatives are also highlighted.

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Founded in 1897 by Herbert Dow, Dow Chemicals began commercial production of bleach in 1898. The company diversified its line of business in 1935 and ventured into the production of plastics with the launch of Ethocel ethylcellulose resins. Dow’s stock began to be listed on the New York Stock Exchange from June 1937.

BUILDING A NEW BUSINESS

“Customer intimacy and market intimacy put you in a better position to understand the latent needs of your existing and prospective customers. Customer knowledge enables you to understand where you can innovate and develop solutions that capture greater value than the sale of products alone.” Over the decades, Dow witnessed significant growth and by 1964, its revenues crossed $1 billion.

By 1980, Dow’s revenues exceeded $10 billion and by 1995, the revenues crossed $20 billion. After witnessing significant revenue growth till the late 1980s, the company faced the problem of stagnant revenues in the 1990s. In 1998, Dow’s annualized revenue growth rate over the previous ten years was less than 0.5 percent.

The top management of Dow felt that it had to find ways to overcome the negative implications of the commoditization of its core chemical products business. In its efforts to increase the revenue growth, the management made fresh attempts to improve Dow’s relationship with its customers.

In the late 1990s, Dow decided to focus on achieving improved levels of customer service and customer intimacy by redefining its image as a more ‘customer-friendly’ company. The company’s mission statement reflected the transformation in its image from a product manufacturing company to a science and technology solutions company (Refer Table I)......

        Case Code   ITSY033
   Case Length    15 Pages
              Period    2002 - 2004
 Organization     Dow Chemicals
        Pub Date     2004
Teaching Note    Not Available
     Countries    USA
      Industry    Science & Technology

Issues

• Understand the importance of a customer-focused e-business strategy for the growth of any organization.

• Recognize the role of IT in integrating different business processes and technologies to make them more customer-oriented.

Customer-centric, e-business, strategy, Dow Chemicals, Dow, chemicals, allied products, Dow, customer service, proactively, IT, Internet enabled technologies, MyAccount@Dow, Elemica, DowNET, customer satisfaction.

Please note:

This case study was compiled from published sources, and is intended to be used as a basis for class discussion. It is not intended to illustrate either effective or ineffective handling of a management situation. Nor is it a primary information source.