Behind Tom Cook’s placid Midwest American countenance beats a heart that quickens for silicone innovation. As Greater China President of Dow Corning, the U.S.-based silicone company that’s been in China for 35 years, Cook has overseen projects such as producing rust-proofing material for support pillars on the Hangzhou Bay Bridge—the world’s longest trans-oceanic bridge. He speaks with Newsweek Select’s Megan Shank about the China market, ways to broaden innovative thinking and the joys of earth-friendly pants.
Megan Shank: Your company reached a plateau from the mid-1990s to the early 2000s. What propelled it upwards again?
Tom Cook: The way we had gotten most of our success was through new product innovation, which drove a lot of our growth. But we realized we had to think more broadly than just product innovation. We could also focus on service needs or solutions to problems pulling on a broader skill set and a broader set of knowledge.
For example, we began to offer our products with no after-sales service—an option some of our clients wanted because they already knew our product, knew how to use it and didn’t want to pay for service. Also, if any customer wants to move from the U.S. to China, we could help them sort out the regulations and even manufacture things temporarily until they established their own capabilities. You need to think about what your customers need, not what you sell. When you think of it that way, it changes your whole view of the world.
Last year, over half of Dow Corning’s sales revenue came from regions outside the U.S. What part did China sales play in that figure?
We don’t release China-specific numbers, but in the past six years, Dow Corning sales have doubled, in China, sales have more than doubled, which means China sales are above the corporate growth rate.
What’s made that happen here?
Silicones go into many different industries, many of which are growing here. The automotive industry, cell phones and personal care products all use silicone. There’s huge opportunity for our product. Our primary driver is not low cost manufacturing to ship to other regions but to reach out to the market here. We need that made-in-China ability to have better responsiveness to our new customers.
Have you had problems with IP infringement?
We’ve had problems with counterfeiting our sealing products. I don’t think it’s quite the issue that it was for a number of years. We went out to the streets to find the source of it and work with the source as much as possible.
So you didn’t legally pursue it?
No, we did it in a more business-oriented way.
How do you protect your IP in China?
The Chinese government has taken some steps to protect IP, but they need to keep working in that direction. We have a strong emphasis on educating employees on corporate values, code of conduct and what is intellectual property. And only people who need to know are given privy to the IP, and even for them, we split it up across jobs and roles so no one individual has too much information.
You’ve spoken about giving back to China and remaining loyal to innovation. Where do these two concepts meet?
There are one billion pairs of jeans made every year worldwide, and half of those are made here. There’s a lot of water and energy being used to produce them. In mid-2007 we introduced a granulated textile softener that’s aimed at the Chinese government’s priorities –how can we help improve the environment and energy usage.
This product reduces the manufacturing steps necessary and reduces the water used by 30 to 50 percent – about 15 less liters of water for each pair of jeans. It comes out to 7.5 million tons of water per year that’s not dirtied. Also, one of the key things is that when you’re making the jeans and you’re processing all that water by heating it, so we’re also talking about using 30% less energy as well.
Who knew silicones could be so sexy?
(Laughs) Innovation brings to life what we’re all about – the impact on the environment, the improvement of quality of life. I think everyone knows that where the environment is at in China, well, we just can’t continue in the same way. We’ve got to get to a point where it’s more sustainable.
You’ve also said a company should ask itself what keeps its customers up at night. What about your sleep?
I think one of the challenges we have here is making sure we hire the best people that we can and develop future leaders. I believe our company should be run by the Chinese – someone who can understand the culture and the language, etc. The sooner we can get our company here to be run by a native Chinese the better.
Might put you out of a job though.
I’ll find something else to do. It’s a challenge to find the right people because of China’s history – there wasn’t really business exposure here 30 years ago, so we’re slowly training people.
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