The Dow Chemical Company

Business Challenge

Advanced analytics at Dow have and continue to focus on enhancing business and functional margins. Dow’s business and functional leadership use internal SAP data through homegrown reporting systems, dashboards, and spreadsheets, which include current and historical data sets to enable decision making. This has proven to be sufficient for current business needs, however, does not allow for significant breakthrough margin improvements. Dow leaders were faced with the challenge of how to incorporate forward-looking analytics and optimization recommendations to enable overall decision making. The focus of the advanced analytics team includes incorporating unique ways to use advanced statistical and data methods/capabilities to provide improved recommendations that drive margin management (price, volume, and cost).

Analytics Solution

The Dow advanced analytics team was able to develop multiple customized solutions that deliver margin enhancements through price positioning/price leakage recommendations, increased sales volume and revenue growth and cost optimization through analytic methods/concepts. These methods include customer and product segmentation, forecasting, elasticity and optimization for price analytic solutions; data mining and market basket techniques to assist in delivering cross-sell and lead identification recommendations and solutions; and hierarchical time series forecasting to deliver raw material forecasts.

Impact

The advanced analytics team enabled and unleashed more than $100M in value from multiple customized solutions that were embedded in the functional and business work processes and operating disciplines over the last two years – all of which couldn’t be possible without the use of internal SAP data direct feeds and external data sourcing.