Engineering a great workplace

by 11 Jun 2009

Dow Corning has been recognised globally as a great place to work. Craig Donaldson examines why its employees rate it so highly and details the strategies of a multi-award winning employer of choice

Dow Corning is a global leader in silicon innova tion and technology, with a net income of almost $US776 million ($989 million) and $US5.45 bil lion of sales last calendar year. It provides 7000 products and services to more than 20 industries such as construction, power and utilities, electronics, oil and gas, healthcare and the automotive sector.

With 10,200 employees worldwide, Dow Corning has also won a swag of awards for its employment practices. In addition to being recognised as one of the best compa nies to work for in the 2008 Great Place to Work study in Australia, it has won similar accolades in countries such as the UK, Germany, Belgium and Korea. The corporation has also been recognised by Fortune magazine as one of the 100 best companies to work for, and as a best employer in Asia by Hewitt Associates and the Wall Street Journal Asia.

Judges in these surveys noted Dow Corning for its “relentless execution of focused human capital programs, persistent empowerment of managers and its highly efficient human resource function”.

Local management structure

This is also the experience of Dow Corning in Australia, according to its HR manager, Tony Swift. He says the com pany’s success as a best employer goes beyond HR and can be put down to a range of factors – including a unique man agement structure and resulting organisational culture.

“We’re structured in a unique and interesting way,” he says. “There is no CEO or MD here who can direct, mon itor and control everything, and that really changes the way we interact with the rest of the company.”

Instead, Dow Corning has a country manager, who works part-time in a facilities and compliance role rather than a strategic one. Dow Corning’s local leadership team also com prises a commercial manager, finance manager and, together with Swift, the team is responsible for overseeing the direc tion of the company’s 40 Australian employees.

While the commercial leadership strategy for the com pany is developed overseas, HR is charged with imple menting it on a local level.

The PIP process

One of the biggest global initiatives is the performance improvement program, or PIP. This is a mandatory process in which managers and employees agree on annual goals.

“The improvement process is significant in that it’s not just about work,” Swift says. “Employees know exactly what’s expected of them throughout the year ahead, and the idea is to set stretch goals that will help them develop.”

Goals are aligned with the strategy of the company, and the formal tools used in the process are globally con sistent – which allows the company to benchmark per formance across every one of its 45 manufacturing or operating sites around the world.

The PIP process underpins a number of other processes including learning and development, remuneration, suc cession planning and performance management.

Employee development

Training is done in a targetted approach, and aims to bridge development gaps as well as further develop high poten tials. Dow Corning offers a comprehensive training calendar throughout the year, and line managers discuss this with employees to make sure training options will help them develop and deliver on their PIP goals.

Workgroup and team leaders organ ise structured on-the-job functionally driven technical training, which is sup ported by “Dow Corning University”, a global system which offers online com puter-based training and an enrolment centre for instructor led training.

In addition, Dow Corning employees have access to subsidies for further edu cation including TAFE, undergraduate and post-graduate studies.

“I think we manage the whole employee development piece pretty well,” Swift says. “We don’t have a sheep-dip approach to training. We spend a lot of money on it, so it’s important to us from both a return on investment perspective as well as improving attraction and reten tion. Employees want opportunities to grow and develop, so we need to provide opportunities for people to do that and incentivise them to stay here.”

Succession planning

Closely linked to the PIP process and employee development is succession plan ning. Dow Corning has a global process that identifies key positions and a limited number of high potential employees for leadership development.

The succession planning process requires the input of HR and the coun try’s leadership team, and Swift says the philosophy behind this is that overseas reviews of high potential employees don’t necessarily take into account how they perform. “It’s important to have people on the ground here assessing high per formers first, because they might be achieving all their goals, but they might be a nightmare to work with on a day-to- day basis,” he says.

High potentials are earmarked for spe cial courses and have access to mentoring programs, short-term international assignments and selected projects under the umbrella of accelerated leadership development.


The PIP process is closely linked to remu neration, which allows for strong trans parency around pay for performance within Dow Corning. “Remuneration is a big one for us, so we want to pay for high performance, as well as attract good people through competitive pay. Our staff are a key source of competitive advantage,” Swift says.

Dow Corning benchmarks salaries annually through Hay Group to ensure that pay is both attractive to external tal ent and an incentive for existing talent to stay with the business.

Swift says that attrition within Dow Corning is almost zero within the com mercial part of the company, while turnover ranges from 6 to 8 per cent in other divisions such as customer service.

Health and wellbeing

Dow Corning has a comprehensive health and wellbeing program and Swift says this is another important pillar in the company’s status as a great place to work. “Wellbeing is a key attraction and reten tion issue for us. We want employees and their families to be happy and healthy, as this is good for the business and the bot tom line. It’s the right thing to do and we value their contribution,” says Swift.

One of the initiatives Dow Corning has put in place is a wellbeing day, in which the office shuts down for all employees to get together offsite and take part in non-work-related, non-com petitive activities that are based on healthy lifestyle ideas and socialising. Employees are encouraged not to discuss business during the day, and Dow Corning has found that such events also encourage employees from all levels to get together with no hierarchi cal overtones.

“We keep it simple,” Swift says. “As an organisation of engineers and chemists we tend to over-engineer things a bit, so we remind ourselves to keep it simple. We reduced the budget for our most recent wellbeing day, given the cur rent economic climate, but it ended up being our most successful day so far.”

Strong communication

Dow Corning has a strong culture of open communication. When communicating with employees, its philosophy is to hide nothing. All employees are encouraged to understand the strategic direction and the financial health of the company. Employees can trust in management to share information early - even if the finer details have not yet been determined. Senior management likes to meet people face to face and address employee groups directly. When a significant change is announced, a senior management team is assigned to different parts of the world so that everyone in the organisation is covered.

Dow Corning encourages open-door, two-way communication. Any employee can send an email to the senior leadership of the company without restriction. Their workgroup-specific communication forums allow for greater interaction among all staff.

They also have a leadership communication forum where selected senior employees get updates and are expected to cascade the information to their teams. In favour of face-to-face communication, senior management visits all sites and engages directly with all employees.

Source: Great Place to Work Institute Australia

Tough times

There has been a restructure within Dow Corning as a result of the downturn, with a global workforce reduction of 10 per cent. There are no further plans for big restructures, according to Tony Swift, HR manager for Dow Corning, who strongly believes in continuing to drive the above initiatives in order to support attraction and retention of talent.

"If we truly value our staff, then we should not switch off everything we do in bad times. I would question whether companies that cut wellbeing because it's an easy way to save money, for example, really value their employees," he says.

"However, we need to be realistic and, rather than winding everything right back, we can look at what the key programs that add value for our staff are and invest there."

Addendum: Since the time of interviews for this article, Dow Corning Corporation has announced that it will be closing its Sydney office in late September 2009.