Dow Chemical Co. faced the challenge of understanding the resilience of its global business under modern-day conditions. It needed to assess all vulnerabilities throughout the chain, while testing and implementing various solutions, according to supply chain analyst Shannon Hemmelgarn. The undertaking was part of a joint effort with Ohio State University and the U.S. Air Force Institute of Technology.
The effort ranged across the company's supply chain. The goal was to identify disruptions that can occur at any point, and determine how they might impact Dow's business. To start, the company developed a case study focusing on its glycol ethers division. "It's a complex supply chain," explains Hemmelgarn, "but on a much smaller scale compared with Dow as a whole." The effort, she adds, "allowed us to focus in on our strengths and weaknesses.
Glycol ether represents a highly integrated business, beginning with the feeding of chemicals into raw materials, through their development into an end product for both internal and external customers. Dow had to address multiple locations, including external manufacturing sites for further processing.
The methodology was based on three discrete components. First was the assessment phase, through which the company determined its supply-chain resilience assessment and management capabilities through a questionnaire given to the various business functions. The second was testing for vulnerabilities under a simulation model - a "risk-free environment," as Hemmelgarn puts it.
The third phase was implementation. In the process, Hemmelgarn says, Dow was able to lower terminal costs and infrastructure while reducing vulnerability of supply through the use of dual sourcing. The whole process took about a year of careful analysis and execution, she says.
Dole's case study was a finalist in the Supply Chain Innovation Award for 2011, co-sponsored by SupplyChainBrain and the Council of Supply Chain Management Professionals.
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