Reshape.

Staying fit is important. In fact, it’s essential. But it only keeps us in the game. To realize our vision of being the largest, most profitable, most respected chemical company in the world, we must do more than just keep pace—we must set the pace.

That means reshaping the Company to provide the structure, develop the know-how, create the relationships and build the culture that will distinguish Dow from its competitors. It means transforming business models, adjusting workforce demographics, refocusing innovation, changing organizational dynamics and re-examining our engagement with society at large.

In 2006, Dow made progress on each of these fronts. We continued along dual tracks toward delivering higher margins and more consistent earnings through our Performance businesses while retaining the cash generation and product integration advantages of our Basics businesses.

We re-cast our marketing organization and began the task of forging a stronger marketing discipline across the entire Company…focusing on industry dynamics, customer needs, strategic opportunities and branding. We maintained our drive for continuous improvement, growth through partnerships and the development of new, game-changing process technologies.

We realigned R&D to help achieve two business-critical objectives: (1) accelerate application development with customers in key regions and (2) support the pursuit of new market opportunities. The start of construction on our 65,000 square meter technology center in China, our planned 600-person R&D facility in India and our eight new customer application centers around the world are evidence of important progress on both fronts.

The year also saw Dow strengthen its worldwide regional organization, creating a framework that will provide critical direction and counsel to our businesses as they pursue their global growth plans, based on strong local knowledge and critical local relationships. And we continued to actively manage our portfolios, investing in markets and businesses that support our strategy for growth and earnings consistency, while divesting businesses that are no longer strategic.

In 2006, we redoubled our efforts to manage people as a competitive advantage by broadening our performance management programs, strengthening our talent development curriculum and accelerating our commitment to diversity and inclusion.

And we again took a leadership role in the development of progressive, collaborative solutions to key issues both inside and outside our industry, from chemical plant and supply chain security to energy efficiency and the future of the U.S. manufacturing economy.

Cleaner Production in China
In 2005, Dow partnered with the State Environmental Protection Administration of China in a three-year pilot project to help small- and medium-sized enterprises engage in “cleaner production” for long-term sustainable development. Since then, nearly 20 enterprises and 250 people have taken part in a combination of training, appraisal and recognition programs that draw upon Dow’s best practices. In 2006, just one year after its launch, the project had already delivered significant reductions in waste and emissions—reductions that not only improve environmental quality and human health, but also deliver economic benefits of more than $12.5 million annually to participating enterprises.

Growth through Collaboration
Through 2006, Dow continued to build business relationships around the globe that are focused on creating long-term competitive advantage. For example, we established Dow Izolan, a joint venture that will provide custom-tailored polyurethane systems to a growing customer base in Russia. In Thailand, we established a new joint venture project with Siam Cement Public Company, Ltd. that will help drive the growth of the Company’s Performance businesses across Asia Pacific. And in Romania, we signed an off-take agreement with Rompetrol Petrochemicals that provides an effective way for our polyethylene business to develop new market opportunities in Eastern Europe. These types of strategic alliances are becoming increasingly important to Dow, providing access to new customers, new geographies, new technologies and advantaged feedstocks, while lowering capital intensity and reducing business risk.

Next section >>

Dow Home Privacy Statement Terms of Use Accessibility Statement Site Map