Chemical Companies Find New Ways To Expand And Streamline Their Operations Online

Midland, MI - The global drive to find greater efficiencies in business has led one chemical company to establish an online business, making it easier and faster than ever for buyers to purchase silicon-based materials. XIAMETER , Dow Corning's online business model, has leveraged the Internet, using it as an innovative, automated channel to customers.

"Creating a web-based business model has maximized productivity and reduced human error, while keeping costs competitive for both our company and our buyers," said Mike Papa, operations manager for Xiameter. "It's important for companies to seek out efficiencies, as the cost of raw materials continues to soar."

Using an online business model eliminates the need for sales visits and phone calls to place an order, freeing up a buyer's time. Once the purchaser places an order, in a matter of seconds, confirmation of price and quantity is provided, along with the ship date, freight terms and credit terms.

Another benefit of offering an online option alongside a traditional business is that it provides a new channel to customers and a new way to interact with them. An online business allows two-way communications with customers and a way to stay in close touch with their needs and expectations. Online businesses also support geographic expansion, as they allow companies to enter new countries and test new markets without making major capital investments in plants and equipment.

"The Xiameter business model allows buyers to make purchases around the clock, giving them flexibility to order whenever and wherever it's most convenient for them," said Papa. "In the future, the chemical industry is likely to see connectivity devices that recognize when raw material supplies are low at a customer's site and automatically send a signal to the supplier's system to reorder. Once parameters have been established and more companies operate on global IT platforms, computers will gain the functionality to interface in that way."

With so many advantages, some wonder why more companies are not using this approach. One factor often lacking is the cultural acceptance within the organization that supports tailoring the offering by brand. Staff must be able to deal with complexity and tailor their service levels according to the brand promise and approach of each business. The differences between the two brands must be clearly articulated; otherwise they can inadvertently over-serve customers of an online brand, which would reduce its profitability. It would be easy to provide more services and value than customers have paid for, which would represent an unsustainable business model.

A second factor required for success is operating through an integrated, global IT platform, such as SAP, that supports the operation of differing business models. This can represent a sizeable investment but the rewards are significant. "The future is right around the corner, and buyers are rapidly adopting online business models to reach existing and new customers in countries around the world," said Papa.

SOURCE: Dow Corning Corporation