Dow Strategies in Business, Free Essay

Information systems strategy

Information is one of the important factors that influence the performance of the business. Information transfer can greatly influence the operations and performance of the business. Every stakeholder requires proper and accurate information delivered on the right time (Jong et al., 2012). Customers need accurate information that should be delivered at the right time that they need it. On the other hand, the business also requires information from the customers and other stakeholders; the feedback is important to the business. This coordination can only be achieved through an integrated communication channel. Through the e-business strategy, the company has been able to create a coordinated platform that allows the customers to obtain any relevant information at the time they need it. Dow chemical company has successfully maintained communication with its customers and other stakeholders. Customers can be able to obtain any information from the company’s website, www.dow.com which provides a platform not only for the customers but also for other stakeholders to obtain any development or changes in the company immediately when it occurs (Form 10-K, 2015). The website provides diverse and valuable information for the customers and other stakeholders. Again, the technological integration has enabled the company to be ranked amongst the top chemical industries that use IT and internet to serve and reach out to its customers.

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Financial strategy and position

Dow chemical company’s financial strategy and position are organized under three different strategies. The cost-leadership strategy is the main strategy that most of the business operations are based upon. In Dow chemical company, the cost-leadership strategy is based upon effective value-adding activity management and organization so as to achieve low-cost production of goods and services (Form 10-K, 2015). Consequently, this strategy is also adopted by Dow to enhance its competitive advantage. To achieve the cost-leadership strategy, Dow aims at increasing its profitability and reducing the production cost. This involves coating the average price of the company. Another way to achieve the strategy is to reduce the product prices and gain more market share but still maintaining the good market performance (Jong et al., 2012). The cost containment in Dow involves various business and economic aspects of planning. Dow chemical company is currently worth over $ 54 billion (Form 10-K, 2015). The company has maintained a clear and coherent record of performance that is accompanied by tremendous progress.

Security Protocol

Due to increased potential security threats associated with the increased chemical manufacturing firms globally, Dow has developed and established a comprehensive security risk management system to ensure safe and secure distribution of products, raw materials and supplies across the globe (Form 10-K, 2015). This security strategy includes carrying out the assessment of potential safety and security risks across the company’s supply chain. It also includes assessing and evaluating the security and safety risks associated with the harmful materials shipped supplies and logistics service practices. Again, as a company that has integrated and embraced technology Dow is faced with the cyber security threats just like any other technological institution (Form 10-K, 2015). However, Dow has established a cyber-security risk management strategy to prevent the criminal elements associated with shipping cargoes. Dow has information security professionals hired to deal with the technological issue or challenge that might affect the firm’s operations. Over the recent years, cyber security threats have increased; for example, the Mexican cyber criminals who recently gained access to logistics information of a certain firm’s shipment to target a specific cargo. Other issues that have been experienced during shipment in the past years is the Somali pirates in the Indian Ocean gaining information about a shipment and targeting a specific cargo. Therefore, Dow chemical company has designed a standard security protocols to assess the information technology security of potential high risk suppliers and other service providers (Form 10-K, 2015).

Additionally, to ensure effective and safe transportation of commodities across the market areas, Dow has established a security measure through collaboration with the both private and public partners to share information for improved security and resilience. For example, the company’s shipment to North America contributes to almost 90% of the company’s total production. The shipment trucks to the region formed a highway security network to enable them share information on security intelligence that has greatly enhanced the company’s security protocol systems.

SWOT matrix and Analysis

SWOT analysis is one of the ways in which business organizations evaluates the threats, strengths, weaknesses and opportunities involved in a project in the business. It is the strategic tool used to determine both internal and external factors affecting the business. The internal factors are the strengths and weaknesses while the external factors include the threats and opportunities presented by the external environment of the business. Dow chemical company is also similar to other business enterprises that face different internal and external forces that influence the performance of the business.

Strengths

Dow chemical company has various strengths such as a diverse portfolio of product specialty (Form 10-K, 2010). The company has diversified advanced chemical materials and plastic businesses. Through its differentiation strategy, Dow has managed to create different agro-sciences that enable it to operate on different areas of specialty (Form 10-K, 2015). Again, Dow has a diverse range of technology integrated products and solutions to different clients in different countries across the globe. Dow is one of the companies that have provided employment opportunities to many people across the world. The company’s workforce currently is over 40,000 across the world. Its vertically integrated manufacturing operations also expand on its strengths.

Weaknesses

Weaknesses are the forces that internally affect the performance of the business. Although it is impossible to find a company that operates without weaknesses as they often exist, but the difference falls in the level of weaknesses. Some companies such as Dow chemical company have fewer weaknesses that assist in improving the performance and management of the company. Some of the weaknesses include the risks associated with the over-reliance on the suppliers (Form 10-K, 2015). Having a single supplier is dangerous to the business as it may affect both the production and purchasing level of the business. Therefore, it is important to minimize the over-reliance on the suppliers especially a single supplier that may disappoint or fail to deliver the supplies on time. Again, Dow faces the legal issues and lawsuit that has tarnished the brand and image of the company in the market (Marvin, 2009). The tarnishing of the brand may not only affect the customers’ perception but also affect the financial performance of the business as more buyers will be drawn away to other businesses. Consequently, the credibility of the company has also been tarnished due to the lawsuits and legal issues that the company faces such as tax evasion in 2013 (Form 10-K, 2015).

Opportunities

As a growing company that still has the desire to develop further especially in the external market, Dow has various opportunities that need exploitation. Some of the opportunities include expansion of the polyolefin films level. The growing demand of polythene materials in the market creates the opportunity for the company to expand its production through increased production level. The increased renewable energy generation and the need to conserve and protect the environment also provides the company with the opportunity to access wider market area to other regions that need it such as Asian and the Middle East countries (Jong et al., 2012). The company has signed various deals with different countries, with the most recent being the joint venture agreement between Saudi Arabian company and Dow to operate in Saudi Arabia in 2015 (Form 10-K, 2015). The program which was set to fully become operational in 2016 aimed at expanding the operations of Dow in the Middle East region and also improves the environmental conservation in the region.

Threats

Threats are the external environmental factors or forces that manipulate the performance of the business organization in the market. Dow chemical company faces various threats both at the national and international levels. Some of the threats include a decline in revenue that exposes the company to weak economic conditions. Since Dow deals with the issues that affect the environment immediately, the environment compliance costs might also affect the production of goods. Further, Dow faces an intense competition from potential competitors in the market (Form 10-K, 2015). Some of the competitors include Bayer Ag Company, ExxonMobil Corporation, and Chevron Corporation (Form 10-K, 2015). The intense competition from these companies may have a great negative impact on the company’s operations.