Dow Invests in Accelerating Digital Transformation

The second annual ARC Industrial Digital Transformation Top 25 report continues to highlight companies that are succeeding at integrating digital technology into all areas of business, fundamentally changing the way they operate and deliver value to customers. This year’s Top 25 companies include many who made the list last year, together with some new companies. Positions were reshuffled due to the changing business dynamics and weighting components of the analysis: financial indicators, transformation indicators, and collective community intelligence.  Dow invests in accelerating digital transformation, and the company ranks #21 in this year’s report.

The last few years have been particularly challenging ones for industrial growth. We’ve been cornered from all sides: pandemics, political unrest, climate change, and macroeconomic uncertainty. The world as we knew it a few years ago has capsized and the boundaries of the new normal are constantly shifting and realigning. Digital transformation is now an imperative and digital transformation leaders can be found across many different industries, sharing common traits and visions, helping organizations overcome complex challenges to innovate and stay agile. Several key trends were identified in this report: importance of sustainability, actively seeking to scale solutions in multiple dimensions, benefits of focus and prioritization, empowering the operational front line, recognition that culture change is required, and active outreach to others.

ARC Advisory Group defines digital transformation as: “The integration of digital technology into all areas of business, fundamentally changing the way companies operate and deliver value to customers. The organization is typically charged to innovate and improve across multiple dimensions such as: digital/disruptive technologies, culture and leadership, operational agility, workforce engagement, customer experience, environmental, social and governance, and competitive performance.”

This is the twenty-first in a series of blogs in the digital transformation space.

Dow

Dow, a global chemical company, is divided into three main segments: Materials science, Agricultural sciences and Specialty products. Dow has been on a digital transformation journey for several years and in 2021 announced a $400 million investment to accelerate digitalization throughout the company. Their digital strategy is to move from simply being a chemical company that “does digital” to becoming a digital developer of new materials. The company's manufacturing Industry 4.0 initiative revolves around customers, employees, and processes. Breaking down traditional organization silos between OT/ET and IT organizations and building an environment of trust, cooperation, benchmarking, and free and ongoing collaboration led to the creation of a joint innovations team which has been paramount to its success. Additionally, the company developed the Dow Digital Operations Center (DOC), which brings together the deep domain expertise resident across the company.  

A few examples of the new digitally enabled capabilities developed at the DOC include using drones and robots to help make Dow a safer place to work and enhance the quality of inspection work. Virtual reality is used to help engineers solve problems early and with lower risk. The company has also rolled out innovations that help to track both people and equipment better. Culturally, the transformation vision is woven throughout the company from it being a line item on the financial books, to the CEO, and to every business unit; some have a digital transformation leader who reports to a business president.  

Road Ahead

Digital transformation is a continuous journey and ARC will continue its research in all areas related to digital transformation. We want to learn more about what is working – and what isn’t – as companies pursue their unique digital transformation activities. A lot is happening both on the supplier and user sides, and we would like to know about the pitfalls and success stories. The  ARC Industrial Digital Transformation Top 25 report will be published on an annual basis. With this being our second year, your feedback is very important to us as we will continue to investigate new approaches and measures to adjust our methodology, identify successful digital transformation initiatives, and help the industry as a whole digitally transform. We are on this journey together!

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