Balancing costs by planning contractor efforts better

Dow, a leading manufacturer of plastics and chemicals, counts on thousands of contractors to perform various daily activities in its plants. This wide variety of workers includes mechanics, plumbers, and electricians, who are hired as contingency support staff to execute general maintenance work, turnaround maintenance, and construction projects in over hundreds Dow sites worldwide.

Estimating the effort for such tasks is often challenging, as each project may involve different complexity and duration. Consequently, contractual rates may not match expenditure, which ultimately has an impact on Dow's profitability. To prevent this, the company required greater transparency, closer to real-time information, and higher process control in order to better plan, source, and manage work from external contractors.

Upgrading to a single automated solution for a seamless labor service strategy

Dow partnered with BearingPoint for the design and deployment of a new solution for contract management. The first phase consisted of a thorough assessment of Dow’s process maturity, as well as a Fit-Gap analysis that identified the pain points of the services procurement process and legacy disconnected tools. As a result, a digital roadmap was recommended to address the multiphase transformation without disrupting the day-to-day operation. A business case for standardized global processes using cloud-based solutions was derived from these evaluations. Measurable benefits were calculated, including cost savings achieved by automated billing calculation, efficiency gain, improved real-time reporting capability, and error elimination. The future state of the digital order-to-pay process was developed with additional custom features to meet Dow's specific needs.

The cloud-based platform, Comengy, was configured to track supplier activities, performance, and provide detailed supplier contractual information. Service providers’ local rates were integrated into a global database with online cataloging that automates all billing calculations. BearingPoint also supported Dow with extensive change management and supplier enablement activities to enhance the onboarding experience of the new solution.

Using technology to drive compliance and transparency in outsourced labor management

With Comengy, Dow now has access to accurate real-time data and on-demand resource availability, planning, and billing. All information is updated almost instantaneously, enabling rapid reassignment of resources, and minimizing the risk of data loss and human error. Clear workflows and invoice automation have improved time and cost efficiency in addition to user satisfaction. Furthermore, the manufacturer benefits from high transparency and data consistency in managing their contractors.

Dow can now utilize Comengy data to build detailed analytics and is able to accrue costs from planned to actual, which allows more accurate forecast and better risk management. In addition, the solution enables appropriate controls, adaptable to Dow’s business needs, while ensuring contract compliance.

Over 150,000 invoices have already been processed for labor, materials, equipment, rent, services, and per diems. Dow continues its journey to transform contractor management and labor sourcing by expanding Comengy to its larger manufacturing locations around the world.

The collaboration between Dow and BearingPoint was outstanding. The team challenged the status quo and generated innovative solution that provided a sustainable platform for Dow, as well as leading the labor services market with best practices.

Ralf Dillmann, Partner at BearingPoint

About Dow

Dow is one of the world's largest manufacturers of plastics, industrial intermediates, coatings, and silicones, supplying customers in fast-growing market segments such as packaging, infrastructure, mobility, and consumer applications. Operating manufacturing facilities in 31 countries with 37.800 employees, Dow delivered sales of approximately $57 billion in 2022.

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