The Chemistry at Dow

Dow Chemical is a 50,000-employee company with $28 billion in revenue. Over the next five years, it intends to grow revenue to $60 billion. To accomplish this, Jon Walker, Global Human Resources Project Director at Dow, has been rethinking Dow’s HR practice and how he can strategically contribute to this ambitious goal. After a careful review, Jon’s conclusion is that the entire process should be focused around one central component: skills. Here we describe the role and the importance of skills and competency models as integrated into the business’s strategic vision and execution. Making a business grow at Dow’s level involves careful management of targets and delivery on them. To be able to deliver on those targets, one traditional business practice is to gather needed skills internally and externally. So the first question that many businesses ask themselves is: do we have the skills to achieve those targets? But even before asking this question it is more germane to consider how to gather, optimize and measure internal skills. Skills Inventory Having an inventory of skills seems to be a great concept; but, practically, how does it work? Jon based his work on one fundamental assumption: we all want to control our own career. Based on this assumption &mdash which we have to say is Darwinian in its result and seems to work quite well &mdash there is no need for a top-to-bottom controlled skills inventory process. Rather, a self-service model in which employees are responsible for their own corporate advancement is the most efficient. This truly transforms the traditional model of management from a patrician model to a coach model. With this approach, Dow helps employees achieve their potential and empowers them to be the ones responsible for reaching it. As a Dow employee, you assess your competencies and transform your organization into a learning organization. Positive consequences are realized in a reduction in the role of supervision, and an increase in the motivation and the achievement of the people who really want to succeed. The key to this model is that individual success will drive company success. Dow is in the middle of some fundamental changes: from a “plastics” company it is becoming a biotech company. To succeed in this transition and reach financial targets, Jon believes they have to combine cleverness with action, or in his terms: “The only way we can compete is to put your brain into your feet and make you run.” Keys to Action Employee development is one of the key benefits of this skill-centric model, but it is also the key to their recruitment and internal redeployment strategy. With more than 100,000 internal applications each year, it has been critical for Jon and his team to optimize the process in place in order to take full advantage of their self-managed career track. The way to achieve this transition is to move away from description-centric job advertising to a more skill-centric model. Dow has been developing advanced competency matrices that enable global corporate directions, like innovation, for example, to be translated in their organizational development and recruitment. This is really when the corporate strategic language can be translated into truly actionable items. The practice has been proven on a limited scale, so Jon’s challenge now is to implement the tools globally to be able to achieve his target (and as he remarks “we think faster than we act!”). Already implemented is a portal for e-learning and skill-based hiring management solution in four countries. The complete roll out will involve the availability for Dow to make an inventory of a significant sample of internal skills as well as to motivate redeployment and optimize organizational development. Measuring the Benefits Benefits are to be measured on several levels: first on increased employee productivity and creativity but also in higher retention. On the retention side, it is too early to be able to benchmark the results but it is acknowledged that turnover costs represent at least 1.5 times the salary of the employee. To conclude, we see in Dow’s organizational structure a true new millennium corporation where global expansion will go hand in hand with personal responsibility and coaching as well as skill based inventory and assessment to achieve a new type of organization, where human capital will finally have its true place. <*SPONSORMESSAGE*>