CHEMICAL HERITAGE FOUNDATION
FRANK POPOFF
Transcript of an Interview
Conducted by
Richard Ulrych
at
Midland, Michigan
on
11 December 2012
(With Subsequent Corrections and Additions)
Frank Popoff
FRANK POPOFF
1935
Born in Sofia, Bulgaria on 27 October
Education
1959
1959
B.S., chemistry, Indiana University
M.B.A., Indiana University
Professional Experience
1987-1987
1987-1995
1992-2000
Dow Chemical Company, Midland, Michigan
Technical Service and Development Department
Chemical Sales Department, Cleveland, Ohio
Assistant Product Sales Manager, Industrial Chemicals
Department
Market Manager, Transportation Chemicals Department
Sales Manager, Oxides and Derivatives and Designed Chemicals,
Dow Europe
Manager, Agricultural Marketing
Director of Marketing, Agricultural and Organic Chemicals
Department
General Manager, Agricultural and Organic Chemicals
Department
Marketing Manager, Dow Europe
Vice President of Marketing and Sales, Dow Europe
Commercial Vice President, Dow Europe
Executive Vice President, Dow Europe
President, Dow Europe
Board of Directors, Dow Chemical Company
Vice President, Dow Chemical Company
Executive Vice President and Executive Committee Member,
Dow Chemical Company
President and Chief Operating Officer, Dow Chemical Company
President and Chief Executive Officer, Dow Chemical Company
Chairman, Dow Chemical Company
2001-2003
Indiana University, Bloomington, Indiana
Harold A. “Red” Poling Chair of Business and Government
1959
1960-1963
1963-1965
1965-1967
1967-1970
1970-1971
1971-1975
1975-1976
1976-1977
1977-1978
1978-1987
1980-1981
1981-1985
1982-2000
1984-1985
1985-1987
Directorships
1985-2006
19881989-1991
1989-2006
19901993-2000
1996-2008
1998-2003
1999-2003
2000-2009
20012001-
Chemical Bank and Trust Company, Midland, Michigan
Indiana University Foundation, Bloomington, Indiana
NCR Corporation, Dayton, Ohio
Chemical Financial Corporation, Midland, Michigan
American Express Company, New York, New York
US West, Inc., Denver, Colorado
United Technologies Corporation, Hartford, Connecticut
Herbert H. & Grace A. Dow Foundation, Midland, Michigan
Michigan Molecular Corporation, Midland, Michigan
Qwest Communications International, Inc., Denver, Colorado
Shintech, Inc., Houston, Texas
Shin-Etsu Chemical Co., Ltd., Tokyo, Japan
Honors
1989
1989
1990
1990
1991
1992
1992
1993
1994
1995
2000
Honorary Ph.D., Indiana University
Honorary Ph.D., Rose-Hulman Institute of Technology
Honorary Ph.D., Alma College
Honorary Ph.D., Northwood University
Honorary Ph.D., Saginaw Valley State University
Knight Commander in the Order Orange-Nassau, the Netherlands
B’nai B’rith, Distinguished Achievement Award
Arthur H. Kavaler Award for Chief Executive Excellence
Chief Executive Excellence Award, Financial World
Distinguished Alumni Service Award, Indiana University
United States Council for International Business Leadership Award
Chief Executive Excellence Award, Financial World
René Dubos Environmental Award
International Palladium Medal
Vision for America Award, Keep America Beautiful
Daniel Fox Lifetime Achievement Award
ABSTRACT
The oral history of Frank Popoff begins with a discussion of Popoff’s native Bulgarian
language. The Popoff family left Bulgaria in 1939 at the onset of World War II, when Frank
Popoff was four years old. They arrived in the United States the following year and made their
home in Terre Haute, Indiana. Popoff recalls his childhood in Terre Haute, including his time
spent working at his family’s dry cleaning business, Popoff Cleaners. He attended Wiley High
School as a member of the Class of 1953.
At Wiley, Popoff took chemistry from a World War I veteran who articulated to his
students the new advances taking place in chemistry and the radical implications they had for
society at large. Fascinated by the possibilities of chemistry, Popoff enrolled as a chemistry
major at Indiana University (IU). He later enrolled in the university’s dentistry school, knowing
that he was not destined to spend his career in a research laboratory. Dentistry, however, also
proved not to be an ideal match for Popoff, who decided to instead finish up his chemistry
coursework while applying his talents to IU’s master’s of business administration program.
Popoff describes how he came to interview at Dow Chemical Company more or less by
chance. Responsible for scheduling job interviews on IU’s campus, he felt obliged to sign
himself up for an interview with Dow when he noticed how few students had shown interest.
He initially had no intention of joining Dow, his mind already set on working at Reilly Tar and
Chemical Corporation in nearby Indianapolis. Yet he was so impressed with the Michiganbased company that upon being offered a position in sales, he promptly accepted and reported to
work in 1959. Popoff recounts his experience carrying out research in Dow’s urethane
laboratory as he waited for the training program for newly recruited salesmen to begin. Upon
receiving his training, he worked as a salesman in Dow’s Cleveland office before relocating his
family to the company’s Midland headquarters in 1963, where he took a job in the inorganic
chemicals department.
After moving to transportation chemicals sales as product manager in 1965, Popoff was
presented with the opportunity to sell Dow’s products in Europe, first antifreeze and then
oxides, derivatives, and designed chemicals. He describes his impression of Dow Europe at that
time, between 1967 and 1969, and some of the challenges the company faced in that theater,
such as conflict over allocation and the image of Dow Europe as a cowboy outfit, a company
solely looking to sell its excess capacity to European customers. Popoff was faced with new
challenges after returning to Midland in 1969, when he was named manager of agricultural
marketing and subsequently asked to oversee the merger of the agricultural chemicals and
organic chemicals departments.
Committed to overseeing this merger, Popoff felt compelled to turn down an offer in
1975 to become the chief financial officer for Dow Europe. However, by 1976 the merger was
complete, and he readily accepted the position of marketing manager for Dow’s European
operations. Popoff explains Dow Europe’s marketing strategy and its gradual acceptance into
the community of the European chemical industry. He describes the late 1970s and early 1980s
as a period of nascent globalization, relating his observations from his experience working in
Europe. He also discusses some of the problems he encountered as president of Dow Europe
between 1981 and 1985, including projects that failed to come to fruition in Saudi Arabia and
Yugoslavia, as well his many successes as president that demonstrated his potential as a
successor to then-CEO Paul Oreffice.
Before discussing his tenure as executive vice president and CEO, Popoff shares his
thoughts on risk taking, the circumstances of his involvement in the Bulgarian-US Economic
Council in the 1980s, and his memories of helping two individuals defect from countries in
Eastern Europe. In 1987, he succeeded Oreffice as president and CEO, a position he held until
1995. He describes two projects he shepherded during his tenure as CEO: the privatization of
the German BSL complex and the development of Responsible Care. After stepping down from
Dow’s chairmanship in 2000, Popoff taught at Indiana University and continued to serve on the
boards of American Express Company, US West/Qwest Communications, and various other
corporations. His interview concludes with a discussion of his hobbies, his opinion of Dow’s
performance in recent years, and his interest in promoting science and math education to
American youth.
INTERVIEWER
Richard Ulrych is Director of Institutional Grants and Strategic Projects at the
Chemical Heritage Foundation. He has studied history at the graduate level at Indiana
University and Jagiellonian University. He also has an advanced degree in linguistics from
Indiana University.
TABLE OF CONTENTS
“A City Boy from Terre Haute”
1
Born in 1935 in Sofia, Bulgaria. Leaving Bulgaria. Description of father’s
military background. Arriving at Ellis Island. Discussion of family’s reasons for
immigrating from Bulgaria. Settling down in Terre Haute, Indiana. Attending
Sandison Grammar School and Wiley High School. Description of high school
chemistry class. Studying chemistry and history at Indiana University.
Description of first time returning to Bulgaria and subsequent return. Working at
family business, Popoff Cleaners. A dentistry interlude at IU. Simultaneously
earning bachelor’s degree and MBA. Analyzing crunchy peanut butter at Quaker
Maid.
Joining Dow Chemical Company
12
Interviewing for jobs in the chemical industry. Nearly joining Reilly Tar and
Chemical Corporation. Working in IU’s placement office and signing up for an
interview with Dow Chemical in 1959. An invitation to interview at Dow’s
headquarters in Midland, Michigan. Being assigned to Dow’s technical services.
Working in the urethane laboratory. Teaching the chemistry course component
of Dow’s training program. Description of the training program.
From Cleveland to Midland
15
A vacancy on the Cleveland sales team. Selling phenol formaldehyde to Owens
Corning Corporation. Creating VERSENE RJA. Selling soda ash to local glass
companies. Relocating to Midland. Joining the inorganic chemicals department
as an assistant product manager. Description of Milorganite fertilizer. Selling
ferric chloride to the city of Milwaukee. Moving to transportation chemicals
sales. A disappointing end for Dowgard antifreeze. Disbanding the Dowgard
sales force. Introducing Weatherset antifreeze. Developing brake fluid for Ford
Motor Company.
Dow Chemical’s Foothold in Europe, 1967-1970
19
Selling antifreeze in Europe. An offer to join Dow Europe on a permanent basis.
Description of process for selecting American employees to join Dow’s
European operations. The beginnings of Dow Europe’s manufacturing
capabilities. Description of the size of Dow Europe. Conflicts with Dow USA
over allocation. Fighting the cowboy image. Description of “controlled
friction.”
A Dow Aggie
24
Transferring back to the United States. Relationship with Robert Naegele.
Description of state of the agricultural chemicals department. Description of
family atmosphere at Dow. Merging the agricultural chemicals and organic
chemicals departments. Getting to know Jack Welch of General Electric
Company. Declining an offer to become chief financial officer of Dow Europe.
The Texans in Midland.
The Demise of the Dow Cowboy, the Growth of Dow Europe
29
Returning to Dow Europe to head the commercial operation. The ousting of
Zoltan Merszei. Description of relationship with Charles Doscher. Expanding
Dow Europe geographically. Discussion of the Iranian Revolution’s impact on
the development of a global economy. Outperforming Dow USA. The
possibility of becoming chief executive officer. Reporting to David Rooke.
Description of Clyde Boyd’s contributions to Dow Europe. Choosing Bill
Stavropoulos as successor. The onset of marketing at Dow. Overcoming Dow
Europe’s cowboy reputation. Acting as an arbiter between European chemical
companies. Responding to an ethylene shortage in 1980. A symposium on
harmonizing the European chemical industry. Description of early stages of
internationalization. Discussion of unethical business practices in the European
chemical industry. Political issues between the governments of the United States
and the Soviet Union. The legacy of Zoltan Merszei.
Two Ill-Fated Projects
44
Dow makes a deal with SABIC and Saudi Arabia. Disappointment with the
crude oil processing unit. Extricating Dow from the SABIC-Dow joint venture.
Building plants in Yugoslavia. The death of Marshal Tito. Working with Harry
Taylor of Manufacturers Hanover Trust to collect Dow’s debts in Yugoslavia.
Dow’s response to defeat. Discussion of US access to crude oil and natural gas.
Purchasing a cracker in Spain.
A Seat on the Board
51
Election to the board of directors in 1982. Dow becomes a global company.
Dow as a matrix organization. Description of Paul Oreffice as CEO. Tension
arises between Paul Oreffice and Ted Doan. Returning to Midland. Discussion
of the role of risk-taking at Dow. Co-chairing the Bulgarian-US Economic
Council. Helping a Bulgarian doctor and his family.
A New CEO at Dow Chemical
57
Anticipating and witnessing the collapse of the Soviet Union. Negotiating the
purchase of BSL. Proposing the purchase of the complex to Dow’s board.
Meeting Helmut Kohl in Bonn, Germany. Responsible Care in context. Gaining
an invitation to the 1992 Earth Summit. Description of sustainable development.
Discussion of industry’s response to full-cost accounting.
Dow Chemical since 2000
65
Retiring as chairman in 2000. Teaching at Indiana University. Description of
the changing perception of the chemical industry. Acquiring Union Carbide
Corporation. The composition of Dow’s board. Description of Michael Parker’s
tenure as CEO. Description of Andrew Liveris’s tenure as CEO. Acquiring
Rohm and Haas Company. Cutting the dividend.
Board Membership
75
Description of involvement with American Express Company. Friendship with
Henry Kissinger. Joining the board of NCR Corporation. Serving as a director
at US West, Inc. Qwest acquires US West. Description of United Technologies
Corporation board. Relationship between Dow and Shin-Etsu Chemical Co.,
Ltd. An invitation from Chihiro Kanagawa to join Shintech’s and Shin-Etsu’s
boards. Description of environmental standards at Shin-Etsu.
Retirement and Concluding Thoughts
81
Relationship between Dow and the city of Midland. Skiing and sailing. Trying
out powerboats. Discussion of the need for educational reform in the United
States. Description of opportunities available to chemistry students.
Index
84
INTERVIERWEE:
Frank Popoff
INTERVIEWER:
Richard Ulrych
LOCATION:
Midland, MI
DATE:
11 December 2012
ULRYCH: This is an oral history of Frank Popoff conducted by Richard Ulrych on 11
December 2012. By the way, I should mention that I also went to Indiana University [IU].
POPOFF: Bravo.
ULRYCH: But as a graduate student.
POPOFF: So did I, both as an undergraduate and graduate student. In which field?
ULRYCH: It was history and the Russian and East European Institute.
POPOFF: Wonderful. I took Russian at Indiana for a few semesters thinking it would be close
to my original Bulgarian. My blue books usually got a red line through them. «Požalujsta porusskij, po-russkij, a ne po-bolgarskoj». “Please in Russian. In Russian, not in Bulgarian.”
Invariably I would get into a time crunch, stop writing in Russian, lapse into a little bit of
Bulgarian, and get penalized for that. Dr. Felix J. Oinas, if I recall, was my faculty advisor. It
wasn’t my major, just a language requirement.
ULRYCH: My language requirement was Russian too. I don’t think I learned it as well as you
did, though.
POPOFF: It’s a difficult language. It’s almost Latin in terms of its use of cases. It has very
few prepositions.
ULRYCH: But Bulgarian doesn’t have cases.
1
POPOFF: No. It’s quite a bit different. We always say that when Cyril and Methodious took
the alphabet and language to Russia, they allowed the Russians to screw it up. We advocate that
Sofia is Athens to Moscow’s Rome. The Russians don’t always concur. [laughter]
ULRYCH: You were born in 1935 in Sofia, so do you have any memories of Bulgaria before
you left?
POPOFF: I don't know if they’re memories or if they’re something I learned from retelling, but
yes, I do. I remember vaguely the place where we lived. I remember some familial situations.
My most vivid memories are leaving Bulgaria in 1939 because I didn’t know why we had to do
that. Then my memories escalate as we went through Serbia, through what is the former
Yugoslavia, Croatia, into Italy.
We left from Genoa, but it wasn’t easy. My father, Eftim Popoff, was an American
citizen. My mother, Stoyanka Kossorova Popoff, was Bulgarian-born. My father met her on a
trip to Bulgaria, and they immigrated back to the US. That’s when my sister Joan [Popoff
Garlington] was born. Then during the [Great] Depression, they went back to Bulgaria. Things
were a little better in Bulgaria than they were here. He left a business behind.
My father was a naturalized American citizen. Because he’d been an army officer
during the Balkan Wars, he was welcomed into the US Army and so received his citizenship.
He came to the United States, I think in 1912 or ’13, and realized quickly that the fastest way to
get a US citizenship was to take advantage of his military background. He wound up at Camp
Custer, Michigan and went over to France with General John J. Pershing’s Expeditionary Force.
Even after he got his US citizenship, he would travel back and forth between Bulgaria and the
US as the political and economic fortunes of Bulgaria ebbed and flowed.
In 1939, it was time to come back. Despite my father being a US citizen, my sister being
a US citizen, and my mother being a naturalized US citizen, I was neither. I had a piece of
paper from Cavendish W. Cannon, the US Consul, that said I was born to my father and mother
on 27 October 1935. They gave me US status, but that didn’t seem to impress anybody at Ellis
Island. I went through the Ellis Island immigration inspection and process on my own. I do
remember that. It scared the hell out of me. We were in New York for a short time, and then
we went to Indiana.
ULRYCH: Why did your father leave Bulgaria?
POPOFF: It was a hopeless situation. There were two Balkan wars, if you’ll recall.
2
ULRYCH: They would have come to an end right before the First World War began.
POPOFF: Precisely. I think 1913 was the end of the Second Balkan War. Bulgaria did
famously in the First Balkan War and gained a considerable amount of territory. But the Great
Powers met after the Second Balkan War and concluded in the Treaty of Berlin that the original
gains were too much. The Second Balkan War was a catastrophe. Serbia, Romania, Greece,
and Turkey joined up to invade Bulgaria, and it was a tough siege. After that war, the prospects
in Bulgaria were very poor. My father thought it was time to come to the New World, which he
did.
ULRYCH: That was, of course, before the 1921 immigration law [Emergency Quota Act] that
would have made it much more difficult.
POPOFF: Exactly.
ULRYCH: You all left in 1939.
POPOFF: And we got here in 1940. We were frustrated quite a little bit in Italy. I think we
had booked passage on two different liners before finally an American ship, the USS Adams,
brought us over.
ULRYCH: You secured your status, that is to say your right to enter the country, in Bulgaria
before you left?
POPOFF: I did, but it was such a chaotic time that I was still subjected to the Ellis Island
ritual. I was separated from my family, but I had that piece of paper, my birth certificate, which
got me through. When I applied for a job at Dow Chemical Company, I was asked for a birth
certificate. All I had was this document in Cyrillic signed by the US Consul. I thought, “I
wonder if this is going to help me get a job with a Midwestern chemical company.” [laughter] It
didn’t seem to be an impediment.
ULRYCH: They just wanted a piece of paper.
POPOFF: They just needed something that said, “Yes, this fellow really exists.”
3
ULRYCH: Did you and your parents leave before the onset of World War II, before
September?
POPOFF: The Sudetenland had fallen, but it was prior to the Polish invasion. We were
admonished by the US Consul to get out. Because you couldn’t leave except with a couple of
suitcases and currency transfer was restricted, my father spent some time purchasing uncashed
US checks at a considerable premium of their worth. He got them from people who received
US checks in Bulgaria and were willing to sell them at a big premium to people who wanted to
get that paper, which was not monetized yet, out of the country. You did whatever you could to
leave with as much you could take with you, still leaving much behind.
As I said, he had a business back here in Indiana.
ULRYCH: He already had that business? Did someone else run it while he was in Bulgaria?
POPOFF: He left it with his youngest brother [George Popoff] whom he had brought to the US
in the 1920s, so he had something to come back to.
ULRYCH: He wasn’t starting from scratch.
POPOFF: Almost. He had lived in Terre Haute, [Indiana] on four different occasions as
recently as 1933 or ’34. My sister was born here in ’32. They traveled back and forth. He
crossed the ocean many times. As I said, as the political and economic fortunes came and went,
he would be in one place or the other. He was quite successful in Bulgaria and reasonably
successful here.
ULRYCH: How is it that he gravitated to Indiana and Terre Haute?
POPOFF: He came over unable to speak English. He knew there were some Bulgarians in
Terre Haute. He had an address, some names on a piece of paper. Getting from New York to
Terre Haute must have been an adventure.
Terre Haute was a very important, middle-sized city at that time. It was approaching
about one hundred thousand people. It’s about half that size now. It was at the crossroads of a
major north-south artery from Chicago, [Illinois] to the Gulf Coast and US 40, which was a
transcontinental highway. Terre Haute was a manufacturing and mining hub. There were
Bulgarian immigrants who had gone there for work, and he had some of their names and
addresses.
4
ULRYCH: I remember from when I was at IU that the library there had this newspaper called
the Makedonski novost from Indianapolis, [Indiana], which was for people who were from
Macedonia who identified themselves as Bulgarians.
POPOFF: There were two newspapers. There was also the Naroden glas, the People’s Voice,
published in Granite City, Illinois of all places.
ULRYCH: Your family read that instead of the Makedonski novost?
POPOFF: Well, we were always close to the Macedonians. They’re Bulgarians after all,
despite the fact that the Greeks dislike them but still claim them, and the Serbs dislike them but
still claim them.
ULRYCH: Now they’ve claimed themselves.
POPOFF: They claimed themselves after a long struggle, including killing the foreign minister
of France in Marseilles in the 1930s and throwing bombs at everybody. Freedom fighters or
terrorists, you pick your choice, but they really wanted out from under the Yugoslav state. Their
language is much closer to Bulgarian than it is to Serbo-Croatian.
ULRYCH: What was it like living in Terre Haute in the 1940s and 1950s?
POPOFF: It was fun. I enjoyed Terre Haute. I went to Sandison Grammar School. I couldn’t
speak a word of English at first. I don’t know when I learned to speak English. Children just
assimilate a language. I got into a few scuffles as a youngster. I was different. Maybe it was
my clothes, my bearing, whatever, but those kids with whom I had regular scraps turned out to
be my best friends. I went to Wiley High School. I enjoyed that and did reasonably well
academically.
I had a choice between Brown [University] or Indiana University. Brown was looking
for people from the Midwest apparently. They sent a recruiter to Terre Haute. I was given a
partial scholarship, but I decided to stay closer to home. I went to IU and did all the things that
everyone should do. I got into a fair amount of mischief at the Sigma Chi fraternity, but I
always had good grades and I always had good luck. I was never in any real trouble in school.
Mischief is good, you know?
5
ULRYCH: Were you already very interested in chemistry when you were in high school?
POPOFF: I was really impressed by a gentleman who was, of all things, gassed in World War
I. His name was Buck Weaver. Buck was my chemistry teacher. He made the subject jump up
off the paper and gave me my interest in chemistry. I was always more interested in chemistry
as a subject and a discipline, rather than being a practitioner in the laboratory. That’s why I
decided that with an undergraduate degree in chemistry, why not get an MBA and see if I could
put that to work, which is what I did.
ULRYCH: From the outset, you never thought, “I’d love to sit in a laboratory my whole life.”
POPOFF: Probably not. A life in the laboratory just didn’t fit my agenda. Perhaps I lacked
the creativity and the vision that successful chemists have. I was really interested in the
commercialization and application of chemistry. This was in the 1950s and 1960s.
ULRYCH: What did Buck Weaver do in his classes? Was there more to them than laboratory
work?
POPOFF: I was interested in the lab; it wasn’t that I was disinterested. I enjoyed the lab and
the experiments, but I didn’t see them as my life’s calling.
Buck Weaver not only made the material vivid from the standpoint of what chemistry
was, but he also was able to translate it into what chemistry was doing for society. That was
during the early phase of plastics. It was the metamorphosis from an industry driven by
inorganic chemicals to more and more organic chemistry. The transformation had started many
decades before, but the transition was becoming very obvious. Pharmaceutical chemistry was
becoming a subject in and of itself.
He showed me the potential for chemistry and made the chemistry itself of interest. It
was not inanimate. It was very animate from the standpoint that first you saw what you were
doing in your synthesis, and then you saw what it might manifest itself into in terms of
applications.
ULRYCH: Right. You saw this was an area where people could do some important things for
the world, shape it in important ways.
6
POPOFF: And make a living. [laughter] Because, I must admit, I had as many hours of history
at IU as I did of chemistry. I took the history for my pleasure and the chemistry for my major
and future employment. Both were pleasurable, but I thought I could probably do a little bit
better with chemistry than history considering my shortcomings as an author and as a
pedagogue. I still am fascinated by history.
ULRYCH: Did you study Russian history since you were learning Russian?
POPOFF: Sure. I studied history from everywhere. I started with ancient history and worked
through all the manifestations. The lack of history instruction to US youngsters is abominable.
Our knowledge of the Middle East, of Asia or the Pacific, and of Eastern Europe isn’t there. We
just don’t do a very good job introducing it to our kids. I have a grandson in Texas. At school
they teach him more Texas history than world history. Well, consider the source.
ULRYCH: At that time, when you were attending IU, I think the school was developing
regional studies in a big way. The Russian and East European Institute was established in the
1950s. In addition to language studies, they also promoted the study of history in those areas.
POPOFF: What impressed me both in linguistics and the history area was the number of GIs,
officers, who were coming to Indiana for graduate studies. In my last year in graduate school,
Jean [Urse Popoff] and I were married. Many of our neighbors in married housing were Army
personnel who were sent there by Uncle Sam to learn a little something about this world we live
in, and some language skills.
ULRYCH: By the way, did your parents instill a strong Bulgarian identity in you?
POPOFF: Sure. I had grandparents here from my mother’s side [Steve and Nicolina
Kossoroff]. They came over in the mid-1930s, and we all got together in Terre Haute. So I was
blessed with maternal grandparents who answered all my questions and told me all the old
family stories.
ULRYCH: Are they the ones who taught you how to read and write in Bulgarian?
POPOFF: Yes, as well as my father and mother. My sister, who’s three years older than me,
really wanted to be more of an American. She more or less averted a big exposure to Bulgarian,
but I was fascinated by it. I still am.
7
ULRYCH: You’ve been back, I’ll assume.
POPOFF: Many times. The first time I went back, I was working for Dow. I was working in
our Zurich, [Switzerland] office. I was delighted and very fortunate to get a job at Dow
International. I almost thought about developing a heavy accent, [laughter] but I couldn’t swing
that. It was time to sell some plastics in Bulgaria. Even though I wasn’t a plastics salesman,
they said to me, “Anybody can sell polystyrene. Why don’t you go over?”
I looked at the back of my passport, and there’s this warning to dual nationals stating
that for reasons of birth and ancestry you are subject to the laws of the state that claims you as a
national, including military service. I thought that was interesting, but I went anyway. After the
third day there, I said to this guy with whom I had become friendly, “What’s this business about
military service?” He said, “Relax. We’ve got a lot of privates. We need plastics. We don’t
need privates.”
ULRYCH: This was the ’67 to ’70 tour?
POPOFF: This was the ’67 to ’70 tour.
ULRYCH: Okay. That’s an interesting time.
POPOFF: It was a fascinating time. Bulgarians were seen as the running dogs of the Soviet
Union. James Bond had us down as the designated assassins in many cases; the Bulgarians
were the bad guys.
ULRYCH: [laughter] That’s right. I remember encounters I had with Bulgarian students in
the States around ’89. They started out as very pro-government, but in the course of 1989
everything started to come apart. Then one day, all of a sudden, they acted like communism
was the worst thing that ever existed.
POPOFF: There was no protest. From Georgi Dimitrov, the first communist head of state, to
Todor Zhivkov, the last under the communist regime, there was very little dissent. They
cracked down hard.
I can remember one time being in Sofia on the advent of the [World] University Games
[in 1989]. Bulgaria really did well athletically with strong state support. They did very well at
the Olympics and other competitions. Bulgaria had sponsored the University Games. Of
8
course, they confiscated almost everything from the marketplace for their visitors and arriving
athletes. I saw graffiti for the first time ever in Sofia. I saw written in rather large capital letters
on a public building, „Nie možem da živeem bez Todor Živkov, ama ne možem da živeem bez
agneško.” “We can live without Todor Zhivkov, but we can’t live without lamb.” [laughter]
That was the nature of the protest. It wasn’t political; it was dietary. [laughter]
ULRYCH: It’s also interesting that the word for lamb is the same in Russian, but totally
different from Polish and Czech. It makes you think about the different paths of the Slavic
languages from proto-Slavic.
POPOFF: Yes. Language is a fascinating subject.
ULRYCH: By the way, how did your father get into the dry cleaning business?
POPOFF: Basically he took a job with a dry cleaner and learned the business as an employee.
When the fellow retired, my dad picked up his business. Popoff Cleaners was a way of life in
Terre Haute, first on the north side and then on Wabash Avenue.
It existed until two years ago. A cousin of mine [Tim Henry Popoff], who’s now
deceased, came over from Bulgaria. He came over the hard way. He came across the border of
Bulgaria illegally and spent a lot of time in Trieste in Italy and in Germany. He joined the US
Army in Germany and gained entry to the US and got his citizenship that way. He stepped in
and took over for my father and uncle. Popoff Cleaners existed until 2010, so it’s no more.
Goodbye to an era.
ULRYCH: It was a good, solid business, and it was there waiting for your father when he came
back from Bulgaria.
POPOFF: It’s a service business. Why do immigrants have restaurants, make candy, shine
shoes, or clean your clothes? It’s a service business. The accent isn’t necessarily a turnoff if
you can get the creases straight.
ULRYCH: Was your mother involved in the business at all?
POPOFF: Oh sure. They worked side by side.
9
ULRYCH: So the whole family was involved?
POPOFF: Absolutely. I learned to press pants at an early age.
ULRYCH: Did you have any major hobbies when you were a kid?
POPOFF: I tried all different types of hobbies, things like collecting stamps, but nothing stuck.
I was always more interested in school and sports. I liked to play ball with my friends.
ULRYCH: You mentioned you had a choice between IU and Brown. How did you decide on
IU?
POPOFF: It was close to home. My sister was going to school there. It just fit.
ULRYCH: I know that you got your degree in chemistry, but there was a dentistry interlude.
POPOFF: I was not interested in bench chemistry. I had good grades, so I was able to get into
dental school very early. They had early admission in the third year, so you would be accepted
without completing a four-year degree. I was pleased to get in, to be accepted early. I went for
a year. I think I was ranked third in my class of ninety students, but I realized that dentistry
wasn’t for me.
The first year of dental school was in Bloomington, [Indiana], and the rest were in
Indianapolis. So the summer after my first year, I went to Indianapolis. I walked into the office
of Dean Maynard Hine, and I introduced myself. He said, “Popoff, Popoff. Oh yes, Popoff.
What can I do for you, Popoff?” He was very amicable.
I said, “Dean Hine, I’ve thought this over, and I don’t think dentistry is my calling.”
Whew, the temperature went from warm to ice cold. [laughter] He said, “Do you realize you’ve
cost the state of Indiana a dentist? We’ll never be able to fill that vacancy. We can’t create
someone who’s had a year of study to take your place.” He gave me a tongue lashing for being
irresponsible. I deserved it, I suppose. Then I asked the obligate question: “Does this mean I
can’t get my deposit back?” He said, “You’re damn right.” [laughter] So I left my early deposit
on the counter at Indianapolis. Then I went back and got my MBA. I really loved that.
ULRYCH: And you finished your chemistry degree.
10
POPOFF: Yes, I did. I did that kind of coincidentally. I had to pick up the last few years of
my language requirement. I had to pick up the last couple of chemistry courses, although I had
taken most of my chemistry. I remember I had one semester of physical chemistry left.
ULRYCH: Okay. I was curious how that exactly worked because you started at Indiana in ’53,
and you ended in ’59.
POPOFF: Yes. I was class of ’57, but both of my diplomas read ’59 because I was carrying
water on both shoulders. It was a heavy load. First I did undergraduate studies, then dentistry.
When I left the dentistry program, I picked up on the undergraduate studies and did the MBA at
the same time. I had to have permission to do that.
It worked out fine, and I’ve been close to Indiana ever since. I’m pleased to be on the
[Indiana University] Foundation board. I’m an emeritus director. That means I don’t have to go
to all the meetings.
ULRYCH: [laughter] While you were in college, did you work during the summers?
POPOFF: Yes, I had several jobs. I was a food chemist at the Quaker Maid division of A&P,
and I learned how to make Ann Page Peanut Butter. To this day, I still enjoy peanut butter. A
lot of people said, “You’ll never want to look at peanut butter again.” I worked in the cleaners
some. I had a number of jobs in the summertime.
ULRYCH: You had a manufacturing job making peanut better?
POPOFF: No, I worked in the lab. Basically we did qualitative analysis. A&P did not make a
crunchy peanut butter at the time. Quel dommage! [laughter] So that was my big project one
summer. They wanted to make a crunchy peanut butter. What do you have to know to do that?
You have to know the particle size of the peanut and how fine you grind them. I spent three
weeks running sieve analysis on Skippy, Jif, and all the other brands.
ULRYCH: You were copying the other brands?
POPOFF: Of course. That was A&P’s policy: imitate the best and then undersell them. That
was the Ann Page label, but it’s pretty much the mantra for all private label products. We were
going to copy the best, so I needed to figure out which was best. Was it Jif or Skippy? Either or
11
both? After a month of analysis, I realized that they didn’t give a damn how fine they ground
their peanuts. The statistics were all over the map, so we went ahead with our program. No one
seemed to complain about our relative crunchiness.
We also had a laboratory director, Mr. Hesse, who was a German gentleman. He gave
you a week’s worth of work that would kill a mule, but if you finished everything he assigned
you by the end of the day on Friday, you would be invited to the cooler. Inside the cooler was
non-denatured ethyl alcohol, which we had because we made vanilla extract there and all sorts
of fruit beverages. He would allow you to get a small beaker and put in a little bit of ethanol.
He would join you, top it up with the juice of your choice, and you would have a drink before
you went home for the weekend. He was a special boss.
ULRYCH: So you pursued a degree in chemistry because you were enamored by the potential
of chemistry and the moneymaking potential of a career in chemistry. You also did the MBA.
Were you thinking that the MBA would help you get a job in the chemical industry, that you
would have a unique skillset compared to other job applicants?
POPOFF: My interviews were mostly in the chemical industry. I thought, with an MBA, if I
matched my skillset with the needs of the employer, perhaps I would do a little bit better than
other applicants.
I had a job offer with Reilly Tar and Chemical in Indianapolis. I almost signed on the
line. This was in ’59. I was working in the placement office at Indiana University. Because
Dow had had a layoff in ’58, they were having a hard time filling their schedule for
interviewees. I said, “It would be a tragedy if Dow stopped recruiting at IU because of a lack of
student interest in the aftermath of the layoff.” Everybody had layoffs that year, but Dow did
terribly badly because they had never had a layoff program in their history. It had been a go-gogo enterprise with many successes.
ULRYCH: Dow has always been very paternalistic.
POPOFF: Yes, it certainly was. Then during the 1958 recession along came a phenomenon
called “Axe Wednesday,” which the natives still talk about, in which Dow let go 10 percent of
the workforce in one day. Did it terribly.
ULRYCH: That was throughout Dow?
POPOFF: Right. Dow wasn’t very international at the time, but it was throughout all Dow
locations, field offices, plants, labs, everything.
12
A year later in 1959 they were having trouble filling their interview schedule because
word had gotten out about the layoffs, so I signed up for an interview with Dow just to help fill
out the schedule. I had dinner with the interviewer [Fred L. Peacock] the night before, and we’d
hit it off reasonably well. During the next day, he got a phone call. His wife was about to
present him with a child. He said, “Frank, I can’t do the interview. I’ve got to go. Come to
Midland.”
It was the farthest thing from my mind, but I said, “Sure.” I came to Midland, and I was
very, very favorably impressed by the people, facilities, just the general makeup of the
enterprise. I came in February. My plane landed in Flint, [Michigan] because of a snowstorm,
so I had to take a bus arranged by the airline from Flint to Midland. I got in bed I think at 2 or 3
a.m. I got a knock on my door at 6 a.m.
I thought, “I'm going to really blow these interviews.” But I had a good set of interviews
with people who became good friends over the years. Another thing that impressed me: they
had some serious people in important jobs come in to talk with the candidates who were
interviewing. That was not lost on me. At other companies, applicants usually spoke to
personnel from the human resources group, not necessarily someone from management or from
a line job who could really answer your questions in detail.
ULRYCH: Was Reilly Tar’s appeal that it was close to home? Is that what you were thinking?
POPOFF: Yes. I also said to myself, “This is aging management. There must be room at the
top.” I still kid Tom Reilly about that. He said, “Frank, those jobs were spoken for.” I said,
“Tom, I realize that now.” [laughter] I’ve been close to some of the Reilly people.
Subsequently Reilly became an important supplier of pyridine chemistry for Dow’s agricultural
chemicals operation, which I had the pleasure of managing for a few years.
ULRYCH: When you started at Dow, you were first assigned to technical services. Is that
what you anticipated when you joined up?
POPOFF: No. I thought I would have a commercial orientation, but they put me in the lab
probably because of my experience or because training programs were not yet fully restarted.
They still weren’t hiring all that aggressively. I was in limbo waiting for a training program.
They put me to work in the urethane lab. Urethane chemistry was relatively new. I
recall doing some things with isocyanates that would be unacceptable by today’s operating
standards. Urethane chemistry at the time was primarily about the flexible foam business. We
were blowing urethane foam by reacting polyglycols with toluene diisocyanate using an excess
of isocyanate to generate carbon dioxide in situ.
13
The trick was to find for that reaction the best catalyst systems in terms of chain
extension and cross-polymerization. I worked hard on the catalyst systems being developed,
usually amine catalysts and organotin catalysts as cross-linkers and chain extenders. I had a
paper in development. I thought I had a good system. It was approved. I had a lot of
supervision, as you can imagine, but I was very proud of that. Then within months, the industry
switched to blowing urethanes with Freon gas [laughter], and all my work was for naught.
Incidentally, many years later when Freon became a bad boy in ozone depletion, the industry
went back to excess isocyanate, and in some cases, the organotin and amine catalysts.
ULRYCH: Are they using your—?
POPOFF: They were using stannous octoate and normal methylmorpholine, or some variations
thereof. That was certainly not exclusive to me. I was just more or less validating the findings
of important people who knew what they were doing.
ULRYCH: While you were working in the lab, were you thinking to yourself, “How much
longer do I have to do this?”
POPOFF: No, I was enjoying it. Also, being the junior guy, I had to make coffee, run the
football pool, and do a few other things. The people there were outstanding, so I enjoyed it
very, very much.
As a matter of fact, because of that, when I took the training program I didn’t have to
take the chemistry course—I got to teach the chemistry course! [laughter] I can remember
many excellent people who had not one inkling of what chemistry was about. There were many
people from overseas. An admiral from the Argentine navy joined Dow to be one of our first
people in Latin America. Carlos Colungia was his name. I got to teach Carlos chemistry. He
was maybe twenty years my senior. I said, “Now Carlos, this is organic. This is inorganic.
These are addition reactions, and these are substitution reactions.”
ULRYCH: When hiring people for its international operations, Dow tended to get people with
no chemistry background?
POPOFF: Basically Dow was looking for people with commercial strengths who could be
taught enough chemistry and who would hold management positions hiring people in operative
positions to fill the gaps. They were people who were commercially competent and connected.
14
ULRYCH: Could you tell me about the nature of the training program because I don’t think
it’s ever been discussed? What was Dow doing then?
POPOFF: There was the obligate course in chemistry for starters. That was a few weeks.
Then basically you learned about Dow. “There’s the organics division, the inorganics division,
the specialty chemicals division, the plastics division. Oh yes, there’s an agricultural [ag]
products group. You all will be going to one of these, so learn something about them.”
They had a number of people come in from management and tell us what Dow was
really all about. I remember a then-director of the company and head of marketing, Donald
Ballman, another Indiana University graduate, coming in and saying to trainees and their wives,
“If you expect your husband to be home during the birth of that child, forget about it. He’ll
probably be on the road working for Dow.” Well, I was home for the birth of one of our three
children, and that one came on Boxing Day, on 26 December. [laughter]
Many other people came in, impressive folks, and also line people who gave you insight
into what commercial industrial selling was all about and what you might expect depending on
where you were assigned. Some gave us an industry orientation in which they addressed what
industries Dow sold to.
Eventually I was told, not quite through completion of the training program, “We need a
salesman in Cleveland, [Ohio].” I asked, “Isn’t there supposed to be an inside sales job where
you learn a little more?” They said, “Here’s your price book. You’re going to start calling on
customers because the fellow you’re replacing is going to be the district manager in Pittsburgh,
[Pennsylvania]. Welcome to Cleveland.” They threw me in the deep end, but I was delighted
because I had a great lot of fun in Cleveland with industrial selling. I really had a good time.
The customers were great. I had a fair amount of success, did a lot of interesting things.
I can remember at one time thinking, “How do we get phenol formaldehyde to Owens
Corning in Newark, Ohio so that we can compete with Monsanto’s phenol?” Monsanto had an
executive on the board of Owens Corning and was well-entrenched. I put together a deal where
we would partially load a phenol car in Midland and drop it off at DuPont’s facility in Toledo,
[Ohio], where they’d top it up with the right amount of formaldehyde. We assumed there would
be some mixing along the way, so we shipped a pre-mix to Owens Corning in Newark, Ohio for
their fiberglass insulation. Can you imagine that today?
ULRYCH: That made you price competitive?
POPOFF: Yes, because we had created a blend that no one else was making and priced it right.
We actually did a few things like that. I can remember our making a chelate that was price
competitive and naming it VERSENE RJA for Richard J. Aniskiewicz, who was the buyer at
Brush Beryllium. They needed chelates. They wanted a deal, so we put together something that
15
was very suitable, that was built around what Dow had in excess in terms of various chelating
agents. You could be creative.
I remember being in Ohio in the midst of major glass manufacturing. I was calling on
Toledo, the “Glass Capital of the World.” Present were Owens Corning, Owens-Illinois, and
Libbey-Owens-Ford, with Anchor Hocking not far away. Dow didn’t make the key ingredient,
dense soda ash, which when combined with sand and heat produced glass. But we were
swimming in cell effluents, dilute sodium hydroxide or caustic soda, at the time in our Texas
facilities. Dow makes cell effluent, which they then concentrate to caustic soda only as needed,
as a co-product with chlorine. The ratio is 1.1 to 1. The demand for the two is seldom in
balance, and at the time we were very long on cell effluent.
The product manager [Thomas B. Becnel], a veteran, a cagey old guy and I got together.
I was bemoaning the fact I didn’t have anything to sell to the glass industry. We wound up
bubbling stack gas rich in carbon dioxide through cell effluent and making soda ash. Bottom
line, it was a homerun because all of the pricing at that time was predicated on proximity to the
glass plants. It was called basis point pricing. If you had the closest production point, you
could generate lower costs for the consumer due to lower freight rate. My customers had plants
that benefited.
We felt like heroes. Then about twelve or eighteen months later, I had to go to all my
customers and say, “We’re running short on cell effluent. Caustic soda demand has
strengthened. I can no longer supply you soda ash.” [laughter] We had a lot of adventures like
that, but creativity was always welcomed.
ULRYCH: More so than creativity, that would have required a good knowledge of chemistry.
Were most of the people at Dow who were in similar positions as you very knowledgeable of
chemistry?
POPOFF: Many were, or they received extra help. Between product management, technical
service, sales and marketing management, one would make sure that the need was filled. I was
lucky because I could perhaps see some things earlier and required a little less help. Things
worked out better that way, plain and simple.
ULRYCH: You were in Cleveland for three years?
POPOFF: Yes. It was a short stint.
ULRYCH: How did Jean like Cleveland?
16
POPOFF: She enjoyed Cleveland very much; we both did. Our first son was born there. Still
we knew that coming back to Midland was an eventuality. Jean could tell you about when we
first came to Midland, how different it was then. There was one motel in town, where we
stayed. I'm sure it wasn’t the best motel experience Jean had ever had. She was a product of
suburban Chicago. We drove past the plant. You could check the aroma.
We didn’t know it was a dry county. Not that it was a big deal, but it tells you a little
something about Midland at that time. It’s come a long way. Some argue it still has a way to
go, but I would debate that. I think it’s a great little place. We came from Cleveland and built a
house.
I had a number of jobs. My first job was as an assistant product manager. It was in the
inorganic chemicals department. I had all the byproducts, the cats and dogs: Epsom salt,
magnesium oxide, magnesium sulfate, ferric chloride, and a few bromine compounds. They
were primarily the heavy inorganic stuff that someone had to sell, but they were all fun and we
had good luck with them.
I can remember getting qualified for the use of our ferric chloride in sewage treatment in
the city of Milwaukee, [Wisconsin], a big deal because of the high volume used at the time to
make the then-popular Milorganite fertilizer. I don’t know if you’re familiar with it.
ULRYCH: No.
POPOFF: Milwaukee has this most amazing Depression-era sewage treatment facility. It
looks like a university, but it’s a sewage treatment plant. They start at one end with raw sewage,
and they wind up at the other end with bagged fertilizer, Milorganite, Milwaukee organic
fertilizer, a great product. It’s a little aromatic when you first apply it, but a lot of people swore
by it back then. It was the real thing.
Of course, getting our ferric chloride into Milwaukee meant we were sold out of ferric
chloride indefinitely. I remember how we did that; it was an amazing thing. I took a team of
guys from the factory, from the shop, to meet their counterparts from the factory floor in
Milwaukee. This was not a high-level meeting, but you learned who was really going to qualify
the material and work with it. We met each other at a place in Chicago called the Millionaires’
Club. We all had plenty to eat and drink, decided we were good friends, and our ferric chloride
was in. [laughter] So I had a lot of fun. Those old inorganics were fun because they’d been
neglected for a long time.
ULRYCH: You came back to Midland in ’63, and then in ’65 you moved to transport.
17
POPOFF: Yes. It was an absolute flip-flop. In Cleveland, I always thought that to be valuable
to the company, you should really learn a business to the point where people come to you for
opinion or advice irrespective of how low you were in the organization. While I was there, I
focused on distribution because Cleveland was a huge distribution center.
We had a number of distributors who were regional in nature, always encroaching on
each other’s territories and never getting along. We tried to sell to all of them, McKesson &
Robbins, Central Solvents & Chemicals, and Inland Chemicals, to mention a few. As
competitors they didn’t get along very well, yet we were trying to supply them all while staying
out of the crossfire in the process. I thought I’d learn something about distribution and try to be
a resource to them and Dow, but when I came back to Midland my job had nothing to do with
distribution.
Subsequently, I went to transportation chemicals sales as product manager, which was
another fun job involving much in the way of distribution. This was in the aftermath of
Dowgard, a Dow venture into consumer products. Saran Wrap had been on the drawing boards
and was succeeding, so Dowgard antifreeze was to be another address to the high margin
consumer products business. Well, it all went wrong. Dow decided they would make a
premium antifreeze from not just ethylene glycol [EG], but ethylene glycol plus inhibitors with
deionized water, as if that was a big deal. They would not sell factory fill to the carmakers or
private label to mass marketers, only Dowgard as a brand.
As you can imagine, the Prestones, Peaks, and Zerexes of this world had a field day with
the naivety of Dowgard, which really was a fabulous product. The carmakers were quite
interested, but Dow said, “No. We don’t sell factory fill. It’s a consumer product.” The
business lasted a couple of years within the consumer products group. After it flopped and was
discontinued, I was assigned to disband the last of the Dowgard sales force. There were some
terrific salesmen in that group. I found a way to keep about ten of them. The other ten were
really oriented to the automotive industry. If Dow wasn’t going to be big in the consumer
automotive industry, they weren’t interested.
So we had very little acrimony in terms of ditching the Dowgard program. But there I
was now with factory fill, private label antifreeze and brake fluids. We decided, “What the hell,
why don’t we make a good low-end brand of antifreeze and sell what we couldn’t sell at a
premium as private label and factory fill to the mass marketers?” The mass marketers were
becoming more and more of a factor. People were buying less antifreeze at the local service
station and more at Pep Boys or at Kmart. We came out with consumer brand antifreeze,
Weatherset, which did well with retailers. It was quite successful. We had good luck with
private label and with factory fill.
We wound up being a big player in brake fluid. We got a phone call from Ford that said
Mr. [Lee] Iacocca had driven his Thunderbird out of the Wixom, [Michigan] plant and
apparently rode his brakes a little bit too much and lost his brake fluid. He was livid: “How can
I boil the brake fluid out of a brand new Thunderbird?”
18
Obviously something was wrong, but Mr. Iacocca decided, “I want a brake fluid that
boils at 375 degrees.” How he picked 375, I’ll never know. Under his mandate, whoever got a
suitable product to him first would be the winner, so we worked very hard to develop the right
fluid for Ford very quickly. Fortunately it passed muster. I think we’ve been the leading player
in brake fluids ever since. We had a lot of chips fall our way.
That final summer in transportation chemicals I got a break because Europe had built a
terminal for ethylene glycol and was in the process of building an ethylene glycol plant. They
wanted to sell some ethylene glycol to the automotive industry as antifreeze. The major market
for EG was as a raw material for polyester fiber, which sold for horribly low prices. You could
make a little bit more money selling it as antifreeze to the major oil companies in Europe and
whoever else in Europe had an interest. Some of the chains in the UK—as a case in point,
Boots—were a player way back when.
So I abandoned my family for a couple of months that summer to help train some people
in Europe to sell private label and factory fill antifreeze. I can remember going into Mercedes
and telling them that our antifreeze passed GM’s [General Motors Company’s] and Ford’s
specifications. They were not impressed. They said, “What makes you think that passing GM’s
and Ford’s specifications makes you of interest to Mercedes-Benz?” But we got some business
and were able to prevail eventually.
We sold to Exxon and a number of major US oil companies, plus the locals, the Totals,
the British Petroleums [BP]. I came back to my job in Midland, and they said “There’s a home
for you in Europe now. Pack up your family and come on over to sell organic chemicals.”
ULRYCH: Before you went overseas, I have a question about the different departments you
worked in. You started selling chemicals in Cleveland. You went to inorganics. Then you
were in transportation chemicals.
POPOFF: That was typical. Once you were chemicals, you were not going to be plastics or
agricultural or metals. (Dow had a metals department offering magnesium and magnesium
alloys.) Yet when you were inside a big department like chemicals, you were often bounced
around from inorganics, to organics, to specialties and performance products. If you were a
commercial guy, eventually you might wind up as a district sales manager. You would have the
whole chemicals line. Then you could aspire to be a sales office manager, and you’d have
chemicals, plastics, metals, and ag. They wanted to broaden people first within chemicals and
then throughout the company at a more senior level. That was not at all unusual.
ULRYCH: In any event, you came back to Midland ready to sell more transport chemicals, and
then you learned you were going to be sent to Europe. What prompted Dow to do that to you?
19
POPOFF: I got along okay with the people in Europe. They were in need of people; Europe
was growing. I passed muster being an un-ugly American, because we had some experiences
early on with people going over and thinking, “Oh wow, Europe! The cathedral is this way, and
the museum must be that way.”
The cultural experience should not supersede the work to be done. You were being sent
there to work. This was a no-nonsense set of circumstances. My wife saw Paris, [France] for
the first time on our way back to the US after I was transferred back to Midland. She said, “I'm
not leaving Europe without at least a weekend in Paris, Frank.” We had a great time and we did
see a lot of different things, but it was not a joyride.
ULRYCH: I spoke with Bob Lundeen a few weeks back.1 He mentioned that Dow’s people in
the United States would sometimes send some of their worst workers to him in the Pacific. I
don’t know if that was the case in Europe. You definitely didn’t fit that profile.
POPOFF: I hope not. [laughter] Europe fought hard to screen problems from being sent
overseas. Some of the problems that were sent overseas were easily remedied. I took on some
people who had issues in the United States but were fabulous in Europe. I’ll tell you about a
couple of them. One was my chief financial officer [CFO]. He didn’t get along with his boss in
Latin America, so somebody asked, “Frank, would you take Pedro Reinhard as your chief
financial officer?” I said, “Send him over and let’s talk.”
I said, “Pedro, you’re a wizard with currencies, and we have more than one here in
Europe.” We had a laugh, and he turned out to be very, very good. He had a rough patch at the
very end. He was one of a few aspirants for the chief executive officer’s [CEO] job, which he
didn’t get. But yes, they did send problems over sometimes. Some were remedied, and some
weren’t.
ULRYCH: Tell me about Europe in 1967.
POPOFF: It was really a go-go environment. We were the new kids on the block. We were in
the process of not only building a commercial organization, but now putting money into
manufacturing.
The genesis of Dow’s overseas operation was highly logical, although I wouldn’t call it
typical. We shipped intermediates overseas. That’s why polystyrene was the principal project
because we could ship ethyl benzene and styrene long distances and make polystyrene in
various local locations without a lot of capital money. The capital was all back in the States to
1
Robert W. Lundeen, interview by Richard Ulrych at Lake Oswego, OR, October 9, 2012 (Philadelphia: Chemical
Heritage Foundation).
20
make ethylene and benzene. From there, it’s easy enough to make styrene monomer or ethyl
benzene and ship it to make polymers overseas. You exported to develop markets. You built
plants to hold markets. You built laboratories to hold markets. Then you got into
manufacturing to become a serious player.
Dow’s Terneuzen site, 1966
We were starting to do that. In Terneuzen, [the Netherlands] there was a major complex
to go along with all of these little polystyrene plants that had been built in Greece and Italy, in
Spain and the UK, in the Netherlands. Those had been our manufacturing base, but then along
came Terneuzen, which gave us the bulk for organic chemistry. It wasn’t until Stade,
[Germany] some number of years later that we developed a chlorine capability. That led us into
vinyl monomer and all of the chlorine chain of products.
It was, to answer your question, a fun time because things were happening. Plants were
being built. Products had to be sold. You were pretty much your own master. You had a lot of
support but not a lot of guidance, so you tried not to make the same mistake twice. We had a
great sales force. My product managers were terrific. The country managers were terrific, and
they are to this day some of my closest friends.
ULRYCH: What were you selling then?
POPOFF: Organics. Chemicals in Europe were divided into organics and inorganics.
Organics was me, and Jim Norbury had inorganics. That was the nature of the business.
Inorganics were primarily chlorinated solvents and the rest of the inorganic products. Organics
21
were oxides and derivatives. I had the specialty chemicals group as well, so altogether I had
oxides and derivatives, organics, and specialty chemicals.
ULRYCH: Everything except inorganics.
POPOFF: Yes. But no plastics except for when I went to Bulgaria to sell polystyrene.
[END OF AUDIO, FILE 1]
ULRYCH: How big was Dow Europe in 1967?
POPOFF: Oh, small potatoes. Certainly it wasn’t a billion dollars. Certainly there weren’t
more than eighty or ninety people in the Zurich headquarters. We did have sales offices in a
variety of places, and we had manufacturing.
It’s hard to pin it down because it was almost an asymptotic curve. The European
economy was pretty good. We had the right products and the right economics, so short on
people but big on possibilities is how I would characterize Dow Europe back then. The fellow
who ran it at the time was Zoltan Merszei. Charley Doscher, the sales manager, was my boss,
and they ran an extremely lean organization.
Europe was the darling of Ben Branch, who was the CEO at the time. The famous Dow
troika was Branch, Carl Gerstacker, and Ted Doan. Yet it was a tough environment because in
many respects you dealt with the traditional cycles of the chemical industry, feast and famine.
Either you had more than you could sell or you were on product allocation. Guess who lost out
on allocation? The boys farthest from corporate headquarters.
I can remember having many, many allocation battles with the US. The US was an area
just as Europe was an area. That was the concept Branch established in this ’67 timeframe.
Dow International became Dow Europe, Dow Pacific, Dow Latin America, and Dow Canada. I
would occasionally come to the States and fight for glycol. We usually had better prices than
the US, but we had less, what shall I say, romance than the home team, the US area. [laughter]
Many people thought the traditional US business had to be served first. I got into some
interesting dialogues over that, but I met a lot of good people that way, sometimes on a semiadversarial basis in terms of our objectives. Many of them became very good supporters of
mine later on. I probably wouldn’t have gotten where I wound up without those guys. I fought
with them initially, but they came around and were supportive of me, for lack of a better word.
22
ULRYCH: What was the rationale for giving priority to the United States?
POPOFF: It was big brother, little brother. There were historical relationships and traditions.
People said, “How dare you take product from the mouths of our long-term customers to feed
those newcomers in Europe? They’ve got their own industry. They’ll be fine. We can come,
and we can go.” It made it very difficult on glycol, amines, plastics, on a variety of products.
ULRYCH: This helped create the impression of Dow as the cowboys, right? You showed up
when you had a lot to sell, and when you didn’t have a lot to sell it was too bad for the
customer.
POPOFF: We worked hard to overcome that, but we were certainly the cowboys initially. You
know the old joke about the Saudi prince and the cowboy outfit.2 That was true during my first
hitch in Europe.
I really fought hard to overcome that the second time around. I had plenty of
ammunition because we had spent a lot of money to put plants on the ground. We were there to
stay, and we confirmed that in the early eighties when DuPont and [Union] Carbide pretty much
pulled out of Europe because it was a hard time. We did fabulously well.
ULRYCH: So when you were in Europe from ’67 to’70, the European impression of Dow was
that it was a company that turned to Europe when it had more than it needed and had to sell the
excess capacity off. It didn’t care about the European customer to the same degree.
POPOFF: That’s what we had to overcome. We did overcome it in some cases, and in some
cases we did not. I remember selling propylene glycol in the UK. As soon as I would put a
contract together, I’d be notified, “ICI [Imperial Chemical Industries] has matched your price.
Thank you very much.” That would happen once or twice before we said, “Take it or leave it.
The next time around we won’t be here when ICI lets you down.”
Those were some pretty tough negotiations because we were always the second supplier
in France, England, and Germany after BASF, Bayer, Hoechst, ICI, Rhône-Poulenc and all the
other French producers, and Montedison in Italy. We were the new guys, so we had to earn our
spurs. The way we did that was not to try to enamor the guys at the top of the companies, but to
work very hard at the intermediate level to demonstrate that we were serious. We tried to really
2
See E.N. Brandt, Growth Company: Dow Chemical’s First Century (East Lansing: Michigan State University
Press, 1997), 549. “A favorite story that circulated in European chemical circles concerned the Saudi prince who
had three sons […]. On his birthday, the oldest son asked for a car, and the prince bought him a new sports
Mercedes. The second son asked for a boat on his birthday, and the prince bought him an elegant Italian racing
boat. The youngest son asked for a cowboy outfit on his birthday, and the prince bought him Dow Chemical.”
23
do a first-class job with the people who had to buy the product and supply the plants. At the end
of the day, those people have a little more say than sometimes they’re given credit for. They’re
the people whose neck is on the line to get the right quality at the right price and the right
service level.
ULRYCH: Ben Branch was the champion of and architect behind Dow’s international
operations. Did you have any interactions with him in this timeframe?
POPOFF: I met him. We talked, but no, nothing substantive.
ULRYCH: Did anyone act as an advocate for the needs of Dow Europe vis-à-vis Ben Branch?
POPOFF: Zoltan Merszei and Branch were very close, which served us well for capital
requirements and new plant authorizations. But Ben was there basically in a capacity way
above the daily fray. If something got hopelessly tangled, it might get to Branch, but that’s not
usually where problems were resolved. You pretty much had to argue resource and product
allocation on the basis of the margin that you were able to secure. If our prices were better than
the US’s, you had a good, solid leg to stand on. Then you made the case for continuity. You
said, “Listen, if I disappoint Ciba-Geigy in Basel, [Switzerland], they’re going to be
disappointed in New Jersey. If I disappoint Exxon in Naples, [Italy], they’re going to know
about it in New York.”
So we really made a case for our international customers, be they based in Europe with
interest in the US or be they based in the US with interest in Europe. It was not that hard, but it
meant you really had to do your homework. You could not come in and say, “Well, we need
more.” Of course, they loved you when product was long. Overall, though, the areas were
highly competitive. This was an era of controlled friction. Have you come across that term?
ULRYCH: No. I don’t know it.
POPOFF: It was very popular in Dow, “controlled friction.” Often it was out of control.
[laughter] There was supposed to be an adversarial relationship among the areas because in the
heat of the battle, the right answer would somehow bubble up to the top. All would work out
fine.
ULRYCH: You had this three-year interlude in Europe. You came back in ’70 and were
assigned to agricultural chemicals.
24
Frank Popoff, Manager of Agricultural Marketing, 1969
POPOFF: Yes. I was so disappointed to come back because we had really gotten the ball
rolling in Europe, but the chain of events that transpired gave me no choice. Bob Naegele was
the new head of the ag department, and working for him was Andrew Butler. Andrew was with
ICI in their agricultural division, a good all-around guy. I had known Bob from my days
working with him in organics. He was a very close personal friend. Eventually he became a
director of the company. He retired and lived a few years thereafter, but he died younger than
he should have.
I met Bob in Cleveland, Ohio. His family lived in Huron, Ohio. I found out that he was
visiting Ohio, and I said, “Naegele, you don’t know me, and I don’t know you. But if you’re in
Ohio, we’re going to make some calls together.” We became very good friends. We didn’t
work together except with him being the product manager and me being the salesman on some
of his products—glycerin, propylene glycol, and propylene oxide. Then he moved through a
number of jobs before becoming head of the ag department.
Andrew Butler was in demand back in Europe, and Naegele said, “Over my dead body.”
They said, “That can be arranged.” He asked, “At least can I have Frank Popoff back?” I said
to him, “Naegele, what have you done to me? I don’t know beans about agriculture. I’m a city
boy from Terre Haute.” He said, “You’ll learn.”
I came back to Midland to the ag department, and again I had a terrific time. Aggies
might be the nicest group of people in Dow. I came in as the marketing manager for ag. The
department then was a little bit of a pariah. We apparently had made a bunch of money selling
Tordon and phenoxy herbicides as defoliants during the Vietnam War. That came to a sudden
halt. The unpopular war and changes in Washington [DC] caused the government to claim a
basis for wanting some of their money back. There were restitutions made. Ag went from hero
25
to heel, and Bob came in to pick up the pieces. He brought me in, and we had a great time
turning things around.
We had good people and good products. We just needed to give some direction to get
the horse pulling in the right direction. Once things were going better, we achieved some long
overdue recognition. At that time, the management was unhappy with the organics department.
A fellow named Dave Schornstein did not mesh well with the Texans who had just come to
Midland in key management positions—Earle Barnes, Levi Leathers, Mac Pruitt. Dave was a
very analytical guy who had good reasons for everything, but sometimes was not terribly
aggressive. The Texans said, “Damn the torpedoes! We’ll build the factories, and you will sell
the stuff. We’ve got the right technology and the right raw materials, so don’t get in the way.”
The ag department did so well that—how it happened, I’ll never know—they merged the
huge organics department with the small ag department, and they put the ag management in
charge.
ULRYCH: I have a couple of questions about what you were talking about. The first one, you
mentioned that the people in the ag department were very nice people. I’m just curious, did you
notice any sort of difference in the socio-background of the people in the different departments?
POPOFF: No, not at all. I don't know if we put something in the water, but Dow people are
Dow people. That was true everywhere, throughout the company. It was a tremendously strong
culture. People bought into it.
In Europe, people bought into it or they left. Many people joined Dow in Europe, got
superb training, and went back to a European employer. I lost a terrific product manager. He
came to me almost with tears in his eyes. He said, “I’ve got a job offer at Wacker I just can’t
say no to.” I said, “Hans Jurgen, we’ll miss you, but I do understand.” Many people were far
less sincere in joining Dow. They wanted to join Dow so they could learn what they needed to
know and then go back to whatever opportunities they felt served them better in the long term
and were closer to home.
The people who stayed with Dow became Dow people. They were willing to reach out
and help each other. The Europeans were a little more inhibited, but once you broke through to
them, it was no problem. The Aggies just smothered you from day one.
ULRYCH: There was this sense of family? You were helping each other?
POPOFF: It was just amazing. We saw that big time with US expats overseas. Suddenly
people really worked hard to help the new people in town. Where do I get a generator that
allows my US refrigerator to work? Where do I send my kids to school? Where do I shop?
26
The women were especially fabulous. Jean was amazing. Some of the women had very
limited language skills, and they were thrown into a morass. The men were doing business
primarily in English at the office and using other languages only as necessary, but the women
were struggling in Schweizerdeutsch and surviving to the best of their abilities.
Dow people pitch in pretty well. The Aggies were remarkable, though, from day one.
When we put ag and organics together, they really reached out to the guys from organics, who
felt wounded. I can remember taking the ag group and the organics group to Port Saint Lucie,
Florida for a little bit of business and a lot of recreation. We needed to get that group glued
together, because how do you provide job satisfaction and shoehorn all those people in a tiny
little building off the main Dow campus, located between the dog pound and the city dump in
Midland?
That’s where the ag department was. It was located out of town. The city dump was on
one side. The dog pound was on the other. There was a little orchard and a barn nearby. And
then there was the ag building itself. It’s a tiny, little building. We shoehorned all of those
people from the organics department into that building. We were crawling on top of each other,
and we had to share offices. But we managed, and it worked out.
It got to be a very cohesive group. Ag chemicals and organic chemicals are not that
dissimilar. Distribution is part of both businesses. We moved some people back and forth from
one unit to the other. I remember asking Charlie Fischer, who ultimately ran the ag business in
Indianapolis, “Charlie, you’re an animal husbandry major from Texas A&M [University]. How
would you like to be the glycol product manager?” [laughter] “What?” He was terrific.
I remember getting guys from organics to be the movers and the shakers in the phenoxy
herbicide business. We mixed and matched a lot of people, and within months it was one pretty
cohesive group. We had good luck. We had good success. Product was short at that time. We
had a lot of fun. God, there are stories galore.
I can remember getting a phone call, “Jack Welch wants to talk to you.” “Oh, really?
What’s Jack Welch want?” “Jack Welch wants phenol.” I said, “I thought Mr. Welch would
talk to someone else?” He apparently made the mistake of calling Branch, whose name is
Charles Benson Branch, and saying, “Hello, Charlie? This is Jack Welch.” Ben passed him off
to me about that time. Jack told me how much he needed Dow’s phenol, how little our other
customers were worth compared to GE [General Electric], how we should starve them and give
him plenty for Norel and Lexan, his two tickets to where he eventually rose in GE.
He was head of the GE plastics division, and the polycarbonates were his baby. He
needed phenol, and phenol was short. He was going to break the allocation scheme that we’d
put together, which really was generous to GE, but not to the point of being unfair to others or
generous enough in Jack’s mind. Jack ended that conversation—we laughed about it later on—
with a four letter word followed by “you.” Jack stuttered at the time. He overcame a lot of
things, including a speech impediment. You probably know that.
27
ULRYCH: I know it from somebody who worked with a very close friend of Welch. They
mentioned two things about Jack Welch: he stuttered and he swore. He couldn’t say five words
without coming up with something.
POPOFF: He ended our conversation with, “F-f-f-fuck you.” Excuse me. [laughter] That was
my first conversation with Jack Welch.
Anyway, the ag-organics department came together very, very well, but it was a shotgun
marriage. Bob Naegele moved on to Dow Canada to be its president, so I moved from the
commercial job to the general manager’s job. Soon I got a call from Paul Oreffice and Zoltan:
“How would you like to come to Europe and be the chief financial officer?”
It sounded like an interesting job. A fellow who had been our CFO in Europe, Herb
Engelmeyer, died in a tragic automobile accident, and they needed a CFO pronto. I’d been in
Europe. I apparently could add, subtract, multiply, and divide to their satisfaction, so they said,
“Welcome to Europe. Be our CFO.” I said no.
ULRYCH: Because you were committed to this integration?
POPOFF: Exactly. They both told me, “You are damaging your career.” I said, “Well, I’ve
got a good job. If I can keep this one, I'm very happy.” They told me, “This will count against
you. It’s nothing personal, but it will count against you.” Still I said, “I cannot leave a work in
progress,” so I turned them down.
ULRYCH: You mentioned that this shotgun marriage took place because the head of organics
couldn’t get along with the Texas guys. Were the Texas guys now in Midland or still in Texas?
POPOFF: By then, Earle Barnes was head of the US area; Levi was head of manufacturing;
Mac Pruitt was head of research and development. They had emigrated from Texas and were
basically running the show. A fellow named John Henske, who was the other high potential
heir apparent, was preempted by the Texas guys. He then went on to be the CEO of Olin.
When he left the company, Texas took over Midland.
ULRYCH: You said they judged opportunities to manufacture certain products based more on
production factors?
28
POPOFF: That was the whole mantra from the Texas perspective. It goes back to a fellow
named Dutch Beutel, whom you have probably have heard a lot about. He was the guy sent
from Midland to basically start up the Texas division. The mantra there was, “We’ve got cheap
raw materials and great technology. It’s tragic not to spend the capital to put these two things
together. Somebody will just have to sell the stuff.”
A great game plan, right? Well, you get to the point where you can argue that maybe too
much of that candy at the wrong time disrupts markets. That was Dave’s perspective, I’m sure.
He was a very analytical guy and very steeped in the industry. He basically took issue with the
Texas perspective, which turned out to be the right position at that time. Even today if you’ve
got raw materials, superior technology, and capital, you should put it together and do your thing.
If you lack any of the above, step back.
ULRYCH: All you need to do is manufacture in the least expensive way.
POPOFF: Exactly. Good logistics, good infrastructure, good raw materials, and good
technology will help you prevail. Eventually capacity determines market share, so if you build
capacity, you will gain market share. The market will grow to accommodate you. Dave was
just overly cautious for the Texans. I believe that he was moved to Latin America to be
president there.
ULRYCH: Where he wouldn’t come in conflict with them?
POPOFF: More or less. Paul Oreffice had just come up to Midland. His history had been in
Latin America. By and large they knew that Latin America would not be neglected as long as
Paul was around.
I’m being hard on Dave. He’s dead now. He was a good guy, and he worked very hard
for Dow. But he fell afoul of some people; things like that happen. They took his organic
chemicals group and sent it to the ag department. It was pretty dramatic stuff.
Later Paul called me and said, “What we said was right, but how would you like to come
back to Europe and be the head of the commercial operation?” I went back, and it was a lot of
fun because I knew the people and the market. Again, a little later there was a conflict. Zoltan
was out of grace. Before I moved over there, Zoltan was still CEO. Clyde Boyd, who had been
the head of Dow Canada, became president of Dow Europe. Zoltan then replaced Clyde in
Canada with Bob Naegele.
I moved into the ag-organics job to replace Bob, but shortly thereafter Zoltan fell on
hard times. I was sent over to Europe to take over from Charley Doscher as director of
29
marketing. Charley, by the way, was a wonderful man and a great builder. Zoltan gets
appropriate credit for building Europe, but Charley was a huge player.
ULRYCH: This was ’76, and Zoltan was CEO until ’78. So already the ground underneath
him was shaking?
POPOFF: I was there for a year maybe before we heard the vibrations. The Texans began to
say, “I can’t work in this environment.” Zoltan made the mistake of going to the US and
declaring, “I'm the CEO, and here’s the way things are to be done.” Some people here objected.
Conflict arose. Ben Branch was Zoltan’s sponsor, advocate, and mentor. Paul Oreffice turned
from pro-Ben to pro-Carl Gerstacker. The Texas guys became head of the US area. It was a
process that took time, but you could see the handwriting on the wall.
I went to Europe for the commercial job, first technically reporting to Charley. But
Clyde Boyd and Charley were never close, having been rivals when both were working for
Zoltan as director of manufacturing and director of marketing, respectively. Within a year or so,
Charley was given responsibility for our pharmaceutical operation in Italy. It was intended to
be the last job he’d have before retiring. The two of us got along fine. We had no conflicts.
ULRYCH: Management feared there might be conflicts?
POPOFF: Charley and I had been too close for that. Charley just wasn’t the new
management’s man. He was getting close to retirement. The conflict I had experienced on
behalf of Dow Europe for the few years I was in Europe, Charley had experienced for his entire
tenure on chemicals, plastics, and everything else.
And Europe was arrogant. There was a time when Zoltan and the Dow Europe
organization said, “Your slower growth is testimony that you have to take a lesson or two from
how we do it here. We’re leaner. We’re more efficient. Look at our ratios.” The controlled
friction model rubs a lot of people the wrong way. It was the one thing I said we would do
away with. I had a lot of help because other people found it counterproductive.
ULRYCH: In your role there in Europe right away?
POPOFF: First commercially and then overall. I wasn’t head of Dow Europe until 1980.
ULRYCH: Was it 1980 or 1981?
30
POPOFF: You know what the man said: “Use dates, especially if they don’t involve numbers.”
[laughter] 1967 was Zurich. 1969, almost 1970 was Midland. 1976 was Dow Europe’s new
headquarters in Horgen, [Switzerland]. I was executive vice president in 1980 with Clyde Boyd
in his final deceleration. In 1981 I became president, and I joined the board in ’82.
Those were interesting times because it was business as usual until the global economy
hit a difficult patch. Dow in the US was hit maybe harder than elsewhere. We were still
expanding by developing the Middle East. We were opening offices in the Soviet Union and in
the East Bloc countries. We were going deeper into Western Europe. We had the geographic as
well as the product capabilities to grow. The US was basically landlocked. Their presence was
going to rise with the economy.
We had a good run in the time before the fall of the Shah of Iran [Mohammad Reza
Pahlavi in 1979], which prompted the second oil shock. When I taught at Indiana, I gave a
course on the global economy. Is it global? Why is it global? When did it become global? I
used to have a lot of fun. I’d ask, “When did the economy become global?” The students
would say something like, “At the end of World War II.” I said, “I know to the date when the
economy became global.” They said, “How can you know that?”
I attribute it, rightfully or wrongfully, to the fall of the Shah, the second oil crisis, and
the huge global recession of the early eighties. I don’t know all the factors that triggered that
recession, but certainly there was the second oil shock with the fall of the Shah. The economy
wasn’t all that vibrant, and that gave it a real cold shower. It was the first truly global recession
in my experience. Yes, there had been recessions that moved from one area to another to
another, but you could usually find a place that was doing better while another was doing
poorly. This time was different.
ULRYCH: When I think of a global economy, I always think about things like banking
systems and how well you can move money around.
POPOFF: Very true. Technology transfer, financial transfer, and people mobility. All of these
things were a factor, but the creation of a global economy couldn’t happen until sovereign states
gave up some of their sovereignty. When sovereign states realized, “Enough. I can’t survive
being an impediment to global trade. I love being able to control everything internally, but this
economy is eating me alive. I’ve got to relax my historic affair with protectionism.”
You saw the European Union become more than just a loose common market. You
began to see tariffs come down as economies needed each other. You began to see technology
transfer. The financial system loosened up. But unless sovereign states are willing to give up
some of their economic sovereignty, you really can’t be truly global.
31
You can see the demise of some elements of state sovereignty in China now. The more
they give up some of their “sovereign issues,” the more they become a more realistic player in
the global market. You saw it in Japan. You saw it in many places. It’s gradual to some
degree, but I like to pick on the graduate students and attribute it to the fall of the Shah and the
second oil crisis. The first oil crisis was a wakeup call, but the second one really put into
motion all these things.
ULRYCH: That was a causal factor?
POPOFF: I think it definitely was. It takes time to unhinge some of the practices that had been
in place for so long. In Europe, we were fortunate because in the early 1980s we still had a
better environment for Dow Europe than they had in the US, at least to my mind.
About my second or third year as head of Dow Europe, I committed the unpardonable
sin of making more money than the US did. Earle Barnes, the US area president, a good man
but very US-oriented, said one time during one of his visits to Europe—I wasn’t even area
president at the time—“Frank, what’s your ambition for Dow Europe?” I said, “To make more
money that the US.” He was deeply offended.
ULRYCH: He felt that it was unpatriotic?
POPOFF: He felt it was just not proper, this rabbit aspiring to be an elephant. I said,
“Everybody can dream.”
My ascendance to the job of president of Dow Europe was a little checkered. Area
presidents had always reported to the CEO; I didn’t. I reported to David Rooke, one of Barnes’s
disciples who was then-head of the US area, and not to Paul Oreffice, the CEO. David and I
eventually became very good friends, but first I had to win him over, which was easy enough.
In 1982, for the second year in a row we made more money in Europe than the US did. David
said to me, “Damn it, Frank. It makes me mad, but you made my bonus.” [laughter]
That was really the first time I felt I got recognition for something beyond the nuts and
bolts of what I did. I was never a fair-haired boy. I was always a little distant and out of the
loop. I remember we used to have meetings for high potential people. It would be a cadre of
twenty, thirty, fifty people. I was never invited to those. Maybe I was out of sight, out of mind.
I didn’t feel I was going anywhere beyond the commercial job in Europe. Then the
presidency of Dow Europe opened up, and I thought, “This is a terminal assignment.” But we
had a good run, and Paul Oreffice wanted someone to be the next CEO whom he trusted and
respected. There were several other candidates, but Paul perhaps didn’t see them in as
complementary a light as they likely deserved. On a trip to Europe, he said, “Frank, if you don’t
32
screw up, about a year from now I may ask you to come to the US.” I knew what that meant.
That’s how he introduced me to the possibility I might be coming back to Midland.
ULRYCH: Before that, you never expected to?
POPOFF: No. Career planning is really one of the biggest mistakes you can make in your
career. It assumes you know more about what’s going to happen than the company does. It
doesn’t work that way. I was happy with every job I had. I find that if you’re happy, you’ll do
your job reasonably well and good things will happen.
So, no, I had no aspirations. In fact, in many respects, coming back to Midland was not
what my family had hoped for. All three of our boys graduated from high school in Europe.
They saw themselves more as American Europeans than as Midland, Michigan Americans.
ULRYCH: If we look at the CEOs of Dow since 1976, when Zoltan took over, there’s only one
person who was born in the United States—Bill Stavropoulos. That’s an interesting
phenomenon.
CEO-Elect Frank Popoff at the podium of the Annual Shareholders Meeting, 1987
POPOFF: It happened over time, but I think it was coincidence. I hope I helped making
qualifications and performance the criteria for promotion by taking controlled conflict out of the
equation. When I became CEO, there were some disruptions. In many respects, Joe Temple
might have been the CEO, but he and Paul were very close in age. Joe had had a stint in
manufacturing, and some of the manufacturing people thought he might be a likely candidate.
In addition to Paul, Bob Keil might have been a possible candidate but had serious problems
33
with his vision. Many people respected Bob and felt that he might have been a contender, but it
didn’t happen.
After Paul, I’m sure there were several candidates, but I don’t remember a host of people
being groomed for the job. I don’t think we did much grooming at that time. That’s one of the
issues that we continued to face at Dow. Sometimes the CEO sees himself in that capacity
forever and ever. We have this rule: you turn sixty and you’re out. I’m not sure if it still exists,
but sixty used to mark deceleration. I’m not sure if it will apply to Andrew Liveris.
ULRYCH: He still has a year to go.
POPOFF: Yes, but I think there’s an understanding that deceleration at sixty is probably not
going to always be the case. I’m not sure; it’s something I kind of sense. We can talk about
that, if you like.
What Paul said came as somewhat of a surprise to me, but when I thought it through, I
concluded, “Who else might it be?” I had had a good run in Europe. The other people who
were potential candidates were more senior, in their late fifties rather than their early fifties. I
was just fifty or fifty-one. Time and circumstance played out as it did. I don’t pretend to know
all of the ins and outs, but Paul said one summer day in London [England in 1984], “If you
don’t screw up, maybe I’ll ask you to come back.”
ULRYCH: I guess we’ll go back—
POPOFF: I want to go back to ag-organics. After I left ag-organics, they split it into ag and
organics.
ULRYCH: Right. I thought you were also part of disentangling them?
POPOFF: When I left, it was understood that I would be replaced by two people. John
Donalds took over ag, and Hunter Henry took over organics.
ULRYCH: Okay. I hadn’t realized that when you were president in Europe, you were
reporting to David Rooke. That was a surprise.
POPOFF: For a short time, I reported to David. The idea was, “We’ll teach you guys in
Europe a lesson or two post-Zoltan and Clyde Boyd.”
34
Clyde Boyd was quite a guy. He was a manufacturing man through and through. What
the Texans wanted to do, he did in spades in Europe—build, build, build! He was a builder.
We had an experiment one summer when I was in Europe the first time. Clyde Boyd, who was
Zoltan’s manufacturing guy, was sent to Midland for the summer. Levi Leathers, who was the
Texas manufacturing head, went to Europe, and Harold Bosscher, who was head of the
Michigan division, went to Texas.
When Clyde was in Midland, he took a look at the facilities and said, “I’ve never seen a
sorrier bunch of plants in my life. Do we know what they can make?” Irrespective of inventory
control or management, he turned the lever to full open and ran every plant at record rates of
capacity. He set all sorts of manufacturing records and created a huge inventory nightmare.
Clyde went from director of manufacturing in Europe to president of Dow Canada under
Zoltan. He was a Zoltan protégé. There was Charley Doscher, Clyde Boyd, and a fellow named
Paul Stroebel. They formed a troika under Zoltan, who had his own troika in Europe just as
corporate Dow did.
ULRYCH: Clyde Boyd had been in Texas before coming to Europe?
POPOFF: He was Texas all the way.
ULRYCH: That probably helped him.
POPOFF: He got along with the other Texans, although there were some major rivalries. He
didn’t get along with Paul very well because he, Bob Naegele, and a couple of other directors
voted not to throw Zoltan out. That was kind of the demise of Bob Naegele and, in some
respects, the demise of Clyde Boyd. Clyde worked to the age of sixty. He pressed hard to be
able to work beyond sixty, but they said no. Bob Naegele worked until age sixty and kept his
seat on the board. That’s another long and sad story, maybe one I won’t share.
But what a marvelous instruction this was to someone like me who was watching it from
the viewpoint of a junior level player. I said, “If I ever get a shot at CEO, we are not going to
manage like this.” And I think there was less acrimony during my hitch than ever before. It
comes and it goes, but you have to really work hard not to have it happen. When it was time for
me to move on, I was going to make sure that the next CEO was recognized as the best man for
the job so there wouldn’t be a lot of dissent and people leaving the ship.
I did that with Bill. I took my management team to Grand Traverse Resort in northern
Michigan. I was there with Joe Downey, Andrew Butler, Enrique Sosa, Enrique Falla, Bill
Stavropoulos, and Keith McKennon. I said, “We’re going to leave here knowing who the next
35
CEO will be in the year and a few months before I step down.” They asked, “Aren’t you afraid
you’re going to be a lame duck?” I said, “No, I'm not. But let’s talk about it.” After a day or so
of discussion with everybody in the room, Bill seemed by dint of age, experience, and a few
other factors to be the man for the job. It was a seamless transition.
Left to Right: Andrew Butler, Enrique Falla, Joseph Downey, Enrique Sosa, Frank
Popoff, and Bill Stavropoulos
ULRYCH: There were no dissenters?
POPOFF: Nobody left the company. Nobody got mad. Nobody dissented. We kept
everybody hitched, and that helped Bill get started. Unfortunately, we didn’t repeat that with
Mike [Parker] and Pedro [Reinhard].
ULRYCH: Right. If we can go back to Europe in ’76, in your oral history [with Dow
Chemical Company], you talked a good deal about how it was during this period when real
marketing began at Dow.3 Could you elaborate on that?
3
Frank P. Popoff, interview by E.N. Brandt and Arnold Thackray at Midland, MI, November 16, 1995. This oral
history is available at the Post Street Archives in Midland, MI, as well as in the Dow Historical Collection of the
Chemical Heritage Foundation in Philadelphia, PA.
36
POPOFF: As opposed to sales, where existing demand prompted sales, marketing is basically
creating the right products for the right markets at the right economics from the perspective of
the longer-term needs of the customer. It’s much more of a planning process. It relates to
strategy rather than pure implementation.
We were a sales organization in Europe. We had product managers in Horgen who were
responsible for pricing and availability, but they weren’t very active in the interface with the
customer. That was really unfortunate because on too many occasions things were a little short
term and a little opportunist to the detriment of the long term. It was part of that cowboy
syndrome that we needed to overcome.
I knew we would have to introduce marketing because we spent the resources to build
plants, which made us a player in Europe. You can’t be a cowboy if you’ve got those kinds of
capital assets on the ground. We still had a reputation to overcome. We needed a little
sophistication to be injected into the organization regarding what we made for what applications
to be sold to whom. It’s not rocket science, but you need to look from the top down to satisfy
not only the immediate, but the long-term needs of the marketplace.
I set up a situation where I put marketing managers in the field to work side by side with
the people in the field who were our sales managers. It was an exercise in compatibility. We
were able to get through that, so we cut the number of staff in Horgen who were product
managers and made half of them marketing managers and put them in key countries like
Germany, France, Italy, and the UK. We began to develop plans not just for the needs from the
top down, but the needs from the bottom up as seen from a French, German, Italian, British, or
Scandinavian perspective. That worked well for us.
The difference between marketing and sales had not been evident until then.
Simplistically we had said, “Sales is about the customer. Marketing is about the company.”
Marketing fought for the company’s interests, while sales fought for the customer’s interest. It
was the commercial policy in Dow Europe, another example of controlled conflict. You really
needed to oil and lubricate that machine. If ever I learned something, it’s that time is the
currency of the new century. I don’t care what century you’re talking about; controlled conflict
just costs too much time.
ULRYCH: When I was reading about the advent of real marketing, I thought it also had to do
with the Texas attitude, the idea that, “We’re making this product, so you better sell it.” They
weren’t really thinking about the customer.
POPOFF: That was the genesis of “sales, sales, sales!” That was a rite of passage to build the
company, but eventually you get to the point where you’re represented throughout the world and
you can make a lot of mischief if you don’t have a plan that accommodates the equally
aggressive players who are also inhabitants of this wonderful industry of ours. You had to make
37
this shift, which was a logical shift. People were waiting for it to happen. It wasn’t rocket
science. Somebody just needed to say, “That part is done. This is the next phase.”
ULRYCH: You were that person?
POPOFF: I didn’t introduce it by myself, no. I took it from the US to Europe. It was an
economic reality in the US earlier on because they had to accommodate the competition there.
Our initial approach in Europe was to try to overwhelm competition. As we got bigger, we had
to learn how to coexist.
ULRYCH: That obliterated the image of the cowboy?
POPOFF: It was part of the transition. The initial part was just taking good care of your
customers. That’s where your reputation rises and falls. To take good care of your customers,
you’ve got to go from the sales mode into something a little more forward-oriented.
ULRYCH: Then during the second oil crisis, there was this enormous increase in the price of
hydrocarbon products. You made the decision that you were going to stop selling.
POPOFF: Yes, there was a perceived overcapacity in almost all chemicals and plastics, but it
was badly overestimated. Our people saw this, and I felt if we pulled some key commodities off
the market we could tighten the markets and increase prices to cover escalating feedstock costs
and restore good margins. It worked.
The two oil shocks were in some ways very different for the chemical industry. The first
rightfully caused concern about shortages and drove up prices. The second caused a recession
and depressed chemical and plastics prices in spite of escalating hydrocarbon feedstock prices. I
had the US organics department during the first oil crisis, which was when Jack Welch and I got
to know each other. Product was short. Raw materials were in tight supply. Prices were off the
map. We raised prices dramatically, they stuck, and we made a bunch of money. Branch was
the CEO then. He gave out bonuses to everyone in the company.
There was a big growth period in 1973, ’74. Then it tailed off. It wasn’t all that robust
in the latter part of the decade when the second oil shock struck. The US operation really went
into a funk. They ran into some circumstances, both financially and from a production
standpoint, that did not serve them very well.
In Europe, we avoided that. How much was internal and how much was external, I don’t
know. We were seen in Europe as the people who could wash through some of the big regional
38
conflicts. It was a strange phenomenon. From being the odd man out initially, we wound up
over a decade or so being arbiters of the industry’s best interests and pricing leaders. No, we
didn’t join any clubs. No, we didn’t fix prices. We were active in trying to get the industry to
behave like an industry.
I can remember being in Paris for a meeting with a group whose goal it was to determine
standards for the industry as the common market was becoming more and more of a reality.
The meeting devolved into a shouting match between the Germans and the French, with the
Germans walking out. We couldn’t have a successful meeting without the Germans, so I was
appointed to bring them back. I’ll never forget that. The meeting happened to be hosted at
Dow’s Paris office on the Avenue Hoche right off the Champs-Elysées. I went to bring back the
Germans, and I found them sitting outside drinking cognac, madder than hell.
I tried to cajole them: “Please come back to the meeting. We can’t conclude the
meeting without you. You’re Germany. You’re BASF, Bayer, Hoechst. You’re the big
players.” They said, “Nein, wir gehen nicht.” I said, “Come on, fellas. You got to go back. By
the way, have you ever seen Paris looking more beautiful?” “Ja, in 1942.” [laughter] I said,
“Oh shit, we’re going to have a difficult time.” I did get them back, but these were the old guys,
and I’ll never forget Herr Spielmann from BASF pounding the table, saying, “Yes, in 1942.”
ULRYCH: That attitude probably didn’t win over the French.
POPOFF: No. They were both stereotypical of all the bad things that you can run into in an
industry with a long history of fierce competition.
To get back to your point, marketing had been a reality in the US out of necessity. We
could stay sellers longer in Europe, but it became apparent when I went back the second time
that marketing had to be a factor, hence the personnel moves, organizational restructuring, and
some discipline in terms of what we were trying to do.
I couldn’t get cost information for my product managers from the business development
staff. Paul Stroebel, who was one of Zoltan’s top people, had strongly contended, “Pricing
personnel shouldn’t know our costs because if they do, they’ll go right down to cost.” I said,
“How can you run a ship without knowing where the hell you’re going, where you’ve come
from, and how much fuel you’ve got in the tank?”
We finally got cost information relinquished to the point where we could put solid
pricing plans to work. We made a bunch of money by virtue of it, but there was still a mentality
that said, “Marketing is about the company, and sales is about the customer. The sales guy
represents the customer. The marketing guy represents the company.” We got a lot done,
because our prior format obviously wasn’t a sustainable situation.
39
ULRYCH: When Zoltan was there, did he see it as a problem?
POPOFF: No, not at all.
ULRYCH: In your Dow oral history, you mentioned how watershed the decision to suspend
production in Europe was in 1980. Had Dow Europe’s image already changed before that?
POPOFF: We were a legitimate player by then, and we had both the mass and the substance to
do that. In February, we looked around. Costs were off the charts, and prices were depressed.
A lot of our business in Europe traditionally was spot business or done with quarterly
pricing, much more so than in the US. Simply, quarterly pricing was the practice of the
European chemical market because raw material prices were spot or quarterly. Thus we had
flexibility in pricing, so we could develop long-term agreements or contracts with quarterly
price provisions.
Europe led in aromatics, while the US led in olefins. In the US, we’re an industry of
engineers, continuous processes, big plants, and cheap raw materials. Take ethylene as a case in
point. Europe makes their ethylene not by tapping LNGs [liquefied natural gas], but by
cracking naphtha. Basically that puts you in the aromatics as well as olefins business. Europe’s
tradition had been aromatics, benzene chemistry, the pharmaceutical industry, and the dyestuff
industry. It’s a different mindset.
I used to pay a lot of attention to feedstocks, particularly naphtha, because I had to. The
Russians were our big suppliers. That’s a whole chapter in and of itself, exciting times. We
recognized that we were on the verge of having a hydrocarbon raw material and thus an
ethylene shortage, which gave us the guts to say, “If ethylene is short and we back up, then other
producers and customers will get the message and see that we’re not swimming in everything.”
The Germans said, “You have really screwed up by withdrawing supply. You’ve destroyed
Dow. We’re going to have a lot of fun with this.” Within three days, they were out of product
and raising prices. Then the next message I got was, “Thank you very much.”
Because we were not a national company, we were asked to do certain things. For
instance, a year later I conducted a symposium at The Dolder [Grand hotel in Zurich], which
was organized so some of the good initiatives that started in the prior year would not collapse. I
asked the Germans, French, Brits, and Italians to make presentations. These were guys who
were way up in their organizations. They all thought they were doing something for the good of
the industry by voicing their views.
Through this symposium, there came to be a better appreciation of the fact that, as an
industry, if one of us is in trouble chances are we all are. Conversely, if we’re all prospering,
then usually that tide will lift all boats. I had legal staff there to make sure that the “i’s” were
40
dotted and “t’s” were crossed. I had to get permission from a lot of lawyers in the US because
some of what we were doing might have been misconstrued. It never was, and no harm ever
came from it.
So that was a unique job that we took on in Europe. We were able to maintain the
situation in Europe, and that’s why we entered the 1980s in better shape than the US and
continued to do well through the eighties. It was also why Europe suddenly became a little less
of a bad boy. [laughter] We had been the bad boys of Dow.
ULRYCH: Before you had mentioned that the onset of globalization was more apparent in
Europe than anywhere else during this timeframe.
POPOFF: For sure. Allegedly, the [European] Union started with the Treaty of Rome and the
coal and steel agreement of the sixties. Along came the common market. The euro was still in
the concept stage. Sovereignty was given up with some reluctance, yet you saw the necessity
for it beginning to be recognized. We were suppliers to the fiber industry, which formed a crisis
cartel in which the common market allowed some price management.
In these phenomena from the late seventies and early eighties, you began to see the
diminution of sovereignty in finance and technology transfer. You also saw it in information
management; the computer was coming into its own. You saw it in a cadre of personnel who
were willing to cross borders and work around the world. You saw it in a host of new
demographics: people in technology, people in commerce, people in finance, people in politics.
You saw it coming together, internationalization, and in it you saw people realizing, “I
can’t hide behind my border forever. I cannot continue to devalue my currency to remain export
competitive.” That had been the practice in Southern Europe: “I’ll just continue to devalue my
currency. I’ll get away with it, at least until the next election when somebody else comes in to
pick up the pieces.”
You began to get a harmonization, a homogenization, which led to the next chapter in
the Union’s metamorphosis, when they decided, “Do we grow broader or deeper?” Perhaps
some mistakes were made. They decided to grow broader, and they added a whole host of new
countries. Why? Because sovereignty dies hard, and to grow deeper would have meant giving
up not only economic options and economic sovereignty, but sovereignty on social and political
matters as well.
Yes, you can argue that mobility of the workforce has increased. That has social
implications and problems, but the harmonization of taxes is not on any agendas. Consequently,
harmonization in Europe has been economic, primarily. There has been social harmonization to
some degree, but not to the point that it undermines France being French or Germany being
German. You see that in other areas, but taxation is the most obvious one.
41
[END OF AUDIO, FILE 2]
ULRYCH: We were talking about the acceptance of Dow, how Dow became almost a
mediator between groups in Europe, and we were talking about globalization. I have a question
that came up in my discussion with Bob Lundeen about the possibility of bribery. In dealing
with European companies and governments, especially in the East Bloc, did you run into any
situations like that?
POPOFF: We had the Foreign Corrupt Practices Act tattooed on our chests. [laughter] We
were very well-appraised, probably to some degree because of a number of scandals that had
emanated. Our legal department in the US was concerned. The possibilities were everywhere,
but I cannot recall too many instances when anyone even hinted about some sort of payment to
capture business.
There was in Italy a concept called “grease.” A bribe was big, but grease was just
enough to move your application from the bottom of the pile, where it would never see the light
of day, to somewhere near the middle or the top of the pile. That was even defined to some
degree. We said, “We’re just not going to do that because it is in the gray area near what
constitutes bribery.”
We had some legal problems. Our general manager in Italy had been accused of
exporting currency. It turned out to be a tempest in a teapot, but we were under pressure for a
while. To cut to the chase, Dow made it clear to everybody that you were on thin ice and you’d
be given no slack if indeed you cheated.
So I cannot recall any transgressions, not in the Soviet Union, not in the East Bloc. I
don’t know what happened in the Middle East or Africa once the product left our hands and
went to distribution, but I know we were never solicited. I can never recall somebody saying,
“Frank, we need to do this deal because otherwise we are out of business.” I can remember in
Africa one time the innuendo that everybody was doing it.
ULRYCH: From one of your people?
POPOFF: From one of our people. I said, “Customers buy based on price, service, and
quality, or for ‘other reasons.’ We’ve got to do a complete selling job because we’re not going
to engage in the other reasons.” Customers came to expect us to be straight.
ULRYCH: You never had the impression that someone was doing suspiciously well?
42
POPOFF: No. The accounting principles were clear, which meant that our people had very
little at their disposal to commit bribery. I saw no irregularities from that standpoint. If one of
our salesmen wanted to buy something for the buyer’s wife, that would be out of his pocket. I
don’t think our guys were so well-paid that they necessarily could engage in that kind of thing.
ULRYCH: Were there any problems or challenges in Europe that people from Dow met that
they may not have met in other international operations?
POPOFF: There were more political issues in Europe than in Latin America, Canada, and the
Pacific. I can remember our people in our Moscow office saying, “Wow, what we’re doing in
Scandinavia to put underlayments of Styrofoam under railroads is a homerun. It really keeps
the railways in Finland, Sweden, and Norway from heaving and pitching during their tough
freeze-thaw period they have every winter. We think there’s an opportunity for that in Russia.”
It’s easy enough to build a Styrofoam plant locally, but probably not in Russia. We
didn’t want to give up technology or license anybody, obviously. They didn’t want our capital;
they reminded us that [Vladimir I.] Lenin did away with capital. So we passed on a lot of deals.
When we were given a chance to participate in Styrofoam sales in Russia in an area we could
economically reach with facilities outside of the Soviet Union, we always had to deal with the
US government. They said, “That Styrofoam technology works really well for railroads. It also
works really well for airfields. We don’t want you promoting that.”
We’ve had demands made on us by a variety of people, by our own government on
occasion, by other governments, by major players. You have to learn to say no to some of these
things. It’s just not worth it; there’s just too much at risk. I hope we learned the difference
between right and wrong somewhere along the line.
ULRYCH: I have a Zoltan question here. He left Dow in ’79 to work for Occidental with
Armand Hammer.
POPOFF: I got an offer to go to work for Armand Hammer. I liked him, but I didn’t accept his
offer. He was quite a guy. I didn’t mean to interrupt. Please go ahead.
ULRYCH: No, that’s fine. What was your personal reaction to the ouster of Zoltan? Had you
been on the board of directors, would you have voted for it?
POPOFF: I don’t know. I wouldn’t have had all the data. I liked Zoltan. I still do. We talk
occasionally. He’s up in years; he’s had his ninetieth birthday.
43
There’s Dow the organization, and there’s Dow the collection of individuals. I have a
lot of regard for Zoltan as an individual, but I can’t respect the fact that he took on the
organization with a “my way or the highway” attitude. We all learned, irrespective of who you
think you are and what your job may be, that Dow is a huge organization. It is not a one-man
show, and you have to be sensitive to the needs of the enterprise. If you’re insensitive, then you
really lose a lot of your support.
When he was strongly supported by Ben and Europe was doing really well, Zoltan could
get away with being, for lack of a better word, a little combative. That only goes so far before it
catches up with you. It caught up with Zoltan. He was a little combative with some of the
people with whom he ultimately had to work, and they neither forgave nor forgot. It’s a shame
in many ways because it damaged Ben. It hurt a lot of people.
ULRYCH: Ben Branch stepped down as chairman. He made way for Zoltan so Zoltan would
have a graceful exit from the CEO position.
POPOFF: Exactly right. They ultimately had a little falling out.
ULRYCH: Zoltan was a valuable part of Dow. His departure from his position was necessary,
but it was unfortunate for the company.
POPOFF: He was remarkable. He didn’t know chemistry. He never got deeply involved in
business details. He was a guy who would say, “We’re going to take that hill,” and was able to
say it in a way that you thought, “Here we are on top of the hill because the boss said so.” He
was a leader more than anything else.
ULRYCH: I guess that style worked better in a smaller setting.
POPOFF: It did. He lacked the following when he came to the United States. He brought with
him Paul Stroebel and a few people. He had some personal issues that were problematic and
turned people off. They cost him. I think he had assumed he was bulletproof. Of course
nobody is. Again, we all learn from other people’s circumstances.
ULRYCH: I have a question about the interim agreement with SABIC [Saudi Basic Industries
Corporation]-Dow to build the Jubail Petrochemical Complex. There was a lot of fanfare
surrounding it, and the agreement was finalized in 1982. Suddenly thereafter Dow pulled out of
the project.
44
POPOFF: Yes. I drew the short straw and got to tell the Saudis that the party was over.
ULRYCH: Were you part of the process earlier?
POPOFF: No, not really. It preceded me. Both Yugoslavia, which was another interesting
project, and Saudi preceded me.
ULRYCH: Were those Zoltan’s projects?
POPOFF: Yugoslavia was. Saudi was not. Saudi started because the Texans wanted to build a
crude oil processing unit. This was the famous COPP unit. The idea was to bring over Saudi
crude to Texas, where it would be cut into fuel and naphtha, no other distillates. It was a very
simple process. The premise was that we would be at a disadvantage compared to the oil
companies unless we could buy directly from the Saudis, which we had never been able to do.
If we were to put together a petrochemical project with the Saudis, we would be able to
purchase directly and then we would be in the same league as Shell, Exxon, and BP.
The Texans put together a Saudi project, which the Saudis loved because we could take
them further downstream than some of the archetypical national oil companies. It was supposed
to be a deal made in heaven. We would get paid for our technology, but the real incentive was
that we would be getting access to crude for the crude oil processing unit. Unfortunately the
COPP unit never worked properly. It was a scandal internally that this unit and the terminal that
was built to offload VLCCs [very large crude carriers] full of crude oil didn’t materialize as
planned.
The Saudi project took place at the highest levels. Zoltan was involved. He was a
director of the company. A fellow named Al Farha was a lawyer who was sent to Europe to be
the intermediary. He was Lebanese by ancestry. But the line organization never got involved.
As soon as the crude oil processing unit failed, the project became a pariah.
ULRYCH: When did it fail?
POPOFF: In the late seventies.
ULRYCH: So the project carried over for a couple of years. Why was that? Because nobody
had the heart to tell them it didn’t make sense anymore?
45
POPOFF: We had supporters of the project, and we had detractors of the project. The
detractors were the people who said, “I’d rather build it in Canada or Texas or Europe. I don’t
trust the Saudis.”
ULRYCH: It was a country risk issue.
POPOFF: It was a huge country risk issue. Others said, “Wait a minute, this is going to be a
good project long term.” It had its ups and downs. Branch was a supporter. Exit Branch and
Zoltan. Then it became clear to Paul Oreffice that the Texans did not like it. Dave Rooke didn’t
like it. Earle Barnes, head of the US area, Levi, and Mac didn't like it.
We were stuck with the project. What’s not well known is that we talked to the Japanese
[Mitsubishi Chemical Corporation]. They picked up a piece of the action, but we were still
heavily involved. Finally, I got the word, “You don’t have to do this, but we think it would be
good if it can be done. If it can’t be done, don’t do it, but it would be good if you can get it
done.”
I had gotten to know the Saudis through regular business. I knew their man who was
head of projects. He had gone to school at Southern Cal [University of Southern California].
He was as Western as you like, but when he needed to be Saudi, he was more Saudi than you
could imagine. Abdulaziz Al-Zamil was his name. He worked right under the oil ministry,
[Ahmed Zaki] Yamani, and Abdullhady Taher. He was SABIC Development. There was a
fellow over him who was a member of an important Saudi family, but Al-Zamil was the man
who was really calling the shots.
I went to Saudi Arabia and confessed, “Abdulaziz, we have a problem. There’s no love
in Dow for this project. We could be a reluctant partner, but I want to emphasize reluctant.
That’s nothing I want to subject either of us to. I’d like to see if we can extricate ourselves from
this and find out if others would participate. The Japanese are a case in point.” He said, “I’ve
seen the handwriting on the wall. I know your management in Midland is not enamored of the
project.”
ULRYCH: He already knew about—?
POPOFF: The COPP unit was not to be. We’d had enough people going to Saudi Arabia.
There’d been harsh discussions on technology transfer, how you divvy up the joint venture, et
cetera. He didn’t have to be super-intuitive to know that the needle had moved. He said,
“Frank, we cannot lose face.” I said, “I’ll tell you what, you don’t have to lose face, but I can’t
afford to lose my ass. I will take all the heat and negative publicity. For our mutual best
46
interest, Dow should get out of this thing.” That made a number of people say “atta boy”
because building capacity in Saudi Arabia, taking on the country risk, and denying funds for
Canada and for Texas didn’t fit the new scheme of things.
Also, Paul disliked Saudi Arabia. There was friction. He was a very proud man; it was
part of his charm. But he did not suffer fools gladly, nor did he back down from situations,
from Jane Fonda to Saudi Arabia. Paul could show you some prickles. [laughter]
So I got us out of it. Everybody was grateful. Then [Josip Broz] Tito died [in 1980].
We had a marvelous project in Yugoslavia. There were twenty million Yugoslavs, big
importers of chemicals, with no chemical infrastructure. Why don’t they, along with Dow, go to
phase one of being a chemical producer? We put some things together. It was a brilliant plan,
almost too good to be true. They paid us up front in subsidized naphtha. They would buy
naphtha as a sovereign state, ship it to Terneuzen, and sell it to us at a discount. They lost
money on every shipment of naphtha, but that’s how they injected money into the partnership.
We injected funds and technology, primarily.
We built a polystyrene plant in Zagreb. That worked fine. We were in phase one of
building a vinyl chloride plant for their PVC [polyvinyl chloride] industry. They did have a
PVC industry, which they wanted to expand. We had a deal, and then Tito died. Afterwards,
although I don’t think it was just because Tito died, we began to see problems. Again, bear with
me on my political theories. It was the 1980s. There was a global recession. A lot of Yugoslav
guest workers were being sent home. The ones who were out of the country had less money to
send home. There was a serious agricultural shortfall in Yugoslavia. There was an earthquake
along the Adriatic Coast. Dubrovnik was damaged, and tourism was knocked for a loop.
There were multiple factors that wound up creating a perfect storm that really started
[Franjo] Tuđman saying, “[Slobodan] Milošević and the Serbian-dominated government in
Belgrade are unjust. They do not treat Croatia well.” Of course, Milošević and Tuđman began
to butt heads. Slovenia had already opted out. The dissolution of Yugoslavia had begun.
ULRYCH: They never wanted to be part of Yugoslavia.
POPOFF: They never wanted to be part of it. And we know what happened in Yugoslavia.
We were faced with a situation where the project was half Croatian, half Serbian. They
didn’t get along. I got the instructions, “Can you get us out of this one?” [laughter] What
needed to be done was to get what we had in equity converted to sovereign debt. Commercial
debt was destined to go unpaid.
We happened to know a fellow named Harry Taylor who worked for Manny Hanny
[Manufacturers Hanover Trust]. He was the primary mover in the repatriation of debt and
financial instruments from Yugoslavia. I thought Harry would eventually be the CEO of
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Manufacturers Hanover Trust, but it didn’t work out that way. He was a terrific friend of Dow.
He said, “You have got a real problem. You’re not going to get paid. The list of commercial
creditors is very long. The people who are going to get paid back are the sovereign lenders
because you don’t default on sovereign loans.” I asked, “Can you make us a sovereign lender?”
He said, “Let me go to work.” Son of a gun, he managed it. He put us on the list of sovereign
lenders, most of whom were governments and governmental institutions.
ULRYCH: How could he do that?
POPOFF: He pulled a few strings. He had a lot of favors due. He worked closely with us.
We had a lot of favors coming, both in Zagreb and in Belgrade. We had friends; they let us in.
We were the only ones. It took us twelve years to get our money back, but we got every penny
out with interest on a regular schedule over that period of time. So we got out of Yugoslavia
with no harm, no balance sheet issues, by essentially being recognized as sovereign lenders.
ULRYCH: When was the final payment made, by the way?
POPOFF: In the early 1990s. I was CEO then. This extrication dance started when I was the
executive vice president of Dow Europe. I think our ten-year note was dated around 1982.
ULRYCH: Okay, so that’s around ’92.
POPOFF: Tito died in ’80, and we saw the handwriting on the wall. The animosity was just
under the surface. He was strong enough to keep the state together, but every republic felt that
somebody else was getting a better deal.
ULRYCH: People always talked about what would happen in Yugoslavia when Tito dies.
POPOFF: It was a shotgun wedding.
ULRYCH: At Indiana, I knew a lot of students from Yugoslavia.
POPOFF: Did they say they were Yugoslavs, or did they say they were Serbs or Croats?
48
ULRYCH: They did identify themselves as Yugoslavs.
POPOFF: You know why? Because they were young. We had a Christmas party in Zagreb. I
still get choked up. We had our people from Bosnia, Herzegovina, Macedonia, the Serbs, and
the Croats there. It was midnight, and everybody had way too much to drink. The kids started
singing a monosyllabic song, “Yugoslavia, Yugoslavia,” and the roof was lifting. Those kids
were proud of what they were achieving, that they were Yugoslavs.
Fast forward a generation, and there was none of that. There was none of that in the
respective republics’ hierarchies. They were convincing their young people that others were
doing better at their expense.
ULRYCH: When the Slovenians left, that was really the beginning of the end. The Croats
said, “If they can do it, we can do it.”
POPOFF: Yes. The Croats and Serbs fought a nasty war over their border. Krajina was in
Croatia, but it was populated by Serbs. There was a lot of bloodshed. They sorted that out.
Then fast forward to Bosnia, and the rest is history.
So we got out of those two projects in Saudi Arabia and Yugoslavia. The Saudi project,
you could argue, might have been a winner. The Yugoslav project had no future.
ULRYCH: No. There were advocates of staying in Saudi even in ’82.
POPOFF: Yes, but not in Dow’s top management. Paul didn’t like it. Dave didn’t like it. The
Texans didn’t like it. With the end of Zoltan and Branch, that pretty well killed it. As I said, the
crude oil processing unit was the initial stimulus, and it was no longer around.
Dow was such a prideful company then. I remember I had an offer from Kuwait:
“Maybe we can take some of that infrastructure off your hands in Texas because you’ve already
built some valuable storage capacity.” I said, “It’s not my deal, but I’ll table it and see if
anybody’s interested.” What Kuwait was really interested in was storage facilities and
infrastructure so that they could ship and store hydrocarbons that were outside their oil quota. I
tabled it in Midland, and I was summarily told, “It’s none of your business.”
We were still too proud to admit that the COPP unit couldn’t be salvaged. We knew it
couldn’t be, but nobody was anxious to admit it. That pride was so much a part of Dow. I hope
it’s still there. It was a blessing nine times out of ten and a curse only occasionally. Dow is
really a unique company. I probably am suspect in saying that, but I’ve looked around a great
49
deal. I can’t speak for Dow today, but until not so long ago the attitude and spirit of Dow was
very can-do. Defeat was always a bitter pill to swallow.
ULRYCH: One interesting thing about the situation with the Saudis: people weren’t
accommodated to the idea of crude oil being as expensive as it is today. Where are we going to
get the crude oil to manufacture our products? That joint venture would have been one way of
getting around the problem. That’s obviously why the Japanese went in.
POPOFF: Absolutely. There was a school of thought that said we could work wonders with
natural gas and LNGs and maybe we weren’t so dependent on crude oil. Our US crackers
originally cracked gas, not liquids. But we also had a big demand for benzene and aromatics,
both of which require cracking naphtha.
The US advantage, which was primarily predicated on cheap natural gas, began to
disappear. When gas prices and oil prices came to parity on a BTU [British thermal unit]-basis,
the virtues of cracking naphtha for the full state of products made it clear that not only were
liquid crackers appropriate in the United States, but that some of our gas crackers should be
converted into flexi-crackers and crack both liquids and gas.
We made a lot of money with flexibility because we would play the market. We did that
first in Europe, which was primarily a liquids facility. When oil and aromatic derivatives were
attractive, we cracked heavy feedstocks, naphtha and other heavy fractions. When LNGs and
natural gas were cheaper, we ran on that. That was something the oil companies didn’t do
because they had a slate that ran a little differently than ours.
ULRYCH: I would think that people already were thinking in the eighties that the US’s access
to natural gas was very finite. I mean, we didn’t anticipate shale gas.
POPOFF: Many thought that hydrocarbons had reached a global parity and the US “Gulf Coast
Advantage” was over. The company saw fit to take Dow Europe’s Algerian condensate, which
we wanted for Terneuzen, and ship it to Texas. I begrudgingly agreed that it was in the
company’s best interest. We struck a deal with Algeria for condensate, and that worked fine in
our Terneuzen crackers and in the Spanish cracker we bought. The Spanish cracker was given
to us basically free. That’s another story, but there came a time when that Algerian condensate
was best used in the US. So we really tried to play the feedstock flexibility game for all it was
worth.
We’d always wanted a southern pole and a northern pole in Europe. We kicked the tires
on all sorts of government-owned facilities in Italy, in Sicily and in Sardinia. There was a
cracker that never got off the ground in Sardinia. We were looking at that. Then the stateowned cracker that served us in Spain, where we had a very good business, developed some
50
harmonics issues. We began to work with them to correct the issue. They were in the process
of building a second cracker. They were a little short of money and a little tentative about the
new cracker, so they sold us the new cracker to be completed by us. It was well along the way,
though, essentially complete.
They sold it to us in pesetas. The peseta crashed, the dollar stood firm, and we paid for
the purchase in about eighteen months with very cheap pesetas. We had it all paid for because
of the currency differentiation. That was another way you could tell that sooner or later a
common currency would be needed to stabilize trade, among other reasons.
ULRYCH: Was it right before or right after you extricated Dow from Saudi Arabia that you
became a member of the board?
POPOFF: Before. I was executive vice president at the time, but the two events weren’t
related. I was made executive vice president on the premise that Clyde Boyd would retire at
sixty and would need a replacement. I was head of Dow Europe for a year before I was elected
to the board. Again, I didn’t report to the CEO. I was told to be patient, and I was. It all
worked out.
Robert Lundeen introducing Frank Popoff at the Annual Stockholders Meeting, 1983
Europe’s former arrogance was being remembered. I brought Dave Rooke to a
management meeting in Europe. Dave was a talker. He was a good guy who wore his heart on
his sleeve. He bled Dow red, white, and blue, 100 percent. He asked if he could say something
at my management meeting, and he blistered us for forty-five minutes about the sins of Dow
Europe’s past. He shook his finger at us. I thought, “This isn’t working out quite like I had
hoped.” That did more to galvanize our guys and make them say, “We’ll show you.” Dow
Europe’s record profits followed soon after.
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The pendulum swings back and forth. People ask, “When did Dow become a global
company?” The answer is, “When our customers became global and when the market became
global.” We learned that the area concept, which had been bedrock to many of us outside the
US, had limitations when indeed it was more important to be a global enterprise that takes care
of business harmoniously around the world than being a series of areas optimizing what was in
their best interest. We had no choice for a while. Our contracts were in the local language. Our
people were local. Our customers were certainly nationals. But one day, for example CibaGeigy, headquartered in Basel, Switzerland, wanted the same deal around the world. They
didn’t want to do business with five or six Dow areas. We said, “This is the new world. The
benefit of being local is being subordinated to the benefit of being global.”
We started with a corporate product department that had global clout. Dave Schornstein
and Bob Naegele came back to coordinate global business. They were really brought back
because the people at the top, Branch and Zoltan, at that time didn’t want the department to be
too strong. Naegele was a powerhouse, and Dave Schornstein was no slouch. When Branch
and Zoltan were gone, that corporate product department became a powerhouse and acted as the
intermediary between the areas.
We developed sellers who would travel the world. If you were calling on Ciba-Geigy
headquarters in Basel, you’d better know their people in Singapore, Hong Kong, and New
Jersey. So it was a transition from the area concept to a more global concept. The area concept
was bedrock to Dow for many years. It was what made Dow great. There was no one in
Midland, Michigan telling us how to do business in Europe. We knew how to do it better. How
can you not know how to do business better when you can see things from the local perspective?
The people in Midland were quick to admit it was pretty hard to make these determinations
sitting in Michigan. They said, “You guys do it.”
Slowly the pendulum shifted. Our customers became global, and we joined them. We
saw that it was becoming the way of the world, the grand scheme of how business would be
done in the future. It didn’t need to be a big, wrenching experience. Again, part of this
globalization concept was that finance, technology, information, and people were far more
mobile.
We always prided ourselves on being a matrix organization. I don’t know if matrix
organizations are in vogue these days or not, but the matrix was always present in Dow. It was
in Midland, Michigan in the earliest days when the fellow who ran the plant, the fellow from
research, the fellow from sales, and fellow from finance would get together and decide what
they would do next. As the company grew, the matrix appreciated to different levels. Still, you
always had functional, geographic, and business dimensions. If you asked a person at Dow,
“What do you do?,” they would say, “I’m a plastics technician in Spain.” The area is Spain; the
function is technology; and the business is plastics. We used to argue about where the matrix
should end and where it should begin. The matrix developed into an exercise in shared power.
Of course, everybody wanted to be primus inter pares; the matrix is always going to be there.
52
Over time we morphed through the area concept, the matrix concept, and a whole host of
organizational structures. Sometimes we acted as if we had invented them, although none of
them were terribly original to Dow. We just were more enthusiastic and maybe a little more
combative in terms of how we implemented that. I think it’s gone now as a result of
globalization, the harmonization of the company, and changes to how the company was
administered. I think it happened on my shift, but it had to happen irrespective of who was
there.
ULRYCH: After you joined the board and Paul Oreffice was installed, there was some concern
about whether he should continue as CEO. Were you getting a sense of that when you were at
the board meetings?
POPOFF: I washed my hands of that in a heartbeat. A couple of people came to me and asked,
“Where would you come down on this?” I said, “This is the most destructive conversation this
company could possibly have. I won’t be a party to it.” I said to Herb Lyon and Ted Doan,
“Please fellas, back up. This is not in our best interest. We don’t need this to happen. Why are
we doing this?” The reason was as much Paul’s personality as it was anything else.
There was a little move afoot to replace Paul. If it had succeeded, it would have been
tragic. No company needs CEO succession issues. The one we had with Michael Parker was
not a good thing. It’s not a one-man show.
ULRYCH: Did you feel that Paul was trying to run a one-man show?
POPOFF: Paul took on the Dow family management tradition. He felt that Branch, as the first
non-family CEO, had been somewhat restrained. The troika didn’t get along famously in terms
of personality, but they worked together very well. Paul wanted to put a stake in the ground and
insure independence. He was a little outspoken about that and perhaps ruffled some feathers.
I couldn’t tell you more about it because I refused to be a party to the process. I did not
participate. All I know is that Paul tangled with the family a little bit, with Ted specifically.
Their styles were totally different.
ULRYCH: Wasn’t Ted pretty much out of the picture by then?
POPOFF: Yes, but he still had huge influence. He was still a director, and directors like to
challenge executives. There may have been some of that before I joined the board. Paul is not
subservient to anyone. He felt he had good support.
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Carl Gerstacker was kind of the wild card in all of this. He was never CEO and never
complained about it. He was chairman. He was part of the troika. I think he would have loved
to have been CEO, obviously, but it didn’t happen. At Dow’s one hundredth anniversary [in
1997], I took great delight in having Ben, Carl, and Ted sit down, just the three of them, and
decide that they were buddies and would let bygones be bygones.
ULRYCH: It’s interesting. I really didn’t realize that they were at such odds with each other.
POPOFF: They were not at terrible odds, but they were very strong people. Ted’s idea of what
Dow’s culture should be was different than Paul’s. You could see that the moment you walked
in the room. Paul is a charging kind of guy. Ted was soft-spoken, more expansive, and
dedicated to research and the long term. Paul was a little bit tough on research and perhaps
didn’t fund it as well as Ted may have liked.
Ted and I were good friends. He used to rag me about not spending enough money on
research. I said, “Ted, you can never spend enough on research.” [laughter] He said, “You got
that right. The guys tell me they could always use more.” He always had a close relationship
with the folks in the labs.
ULRYCH: Okay, this is new information for me. Then around 1985 you were asked to come
back to Midland to assume the role of executive vice president?
POPOFF: The hitch I had in Europe, as I told you, I thought might be a terminal assignment,
but then Paul asked me to come back. I was grateful to him for that. I had a lot of respect for
Paul. He was a strong guy, which served him well in some circumstances and caused some
conflict in others.
ULRYCH: You were happy to come back to Midland?
POPOFF: Yes. My sons were going to school in the US. I would have been happy in either
circumstance, but Jean and I were pleased to come back. I was pleased with the job. Jean was
probably more ambivalent than I was; she enjoyed Europe very much. In some respects it was
time to come back, but in some respects I could have stayed in Europe a long time.
ULRYCH: Did your children consider university education in Europe?
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POPOFF: They all finished at the international high school in Zurich. They thought that
eventually we would be back in the US, so they did not take a serious look at the universities in
Europe. But they still think that football is a game played with a round ball that has black spots
on it. [laughter] They’re fanatics of the game. Actually, I think Indiana University just won the
NCAA [National Collegiate Athletic Association] championship in soccer. My sons all called
and said, “Congratulations. The Hoosiers won their eighth or ninth NCAA soccer
championship.”
ULRYCH: They were certainly Europeanized in that respect. I wonder, you frequently took
risks in your career. Did you encourage other people to do the same thing?
POPOFF: I don’t fancy myself a huge risk taker. It seems that there are times when obviously
risk is appropriate and failing to take the risk is far more catastrophic than not doing so. Yes, I
took some risks, but that’s the nature of the work. We surely encouraged everybody to do so.
We talked about appropriate risks. We had a concept called the “freedom to fail.” I can’t
remember too many people being criticized for taking something on and having it not quite
work out the way it should have.
I think Branch, when he was a youngster, was party to a crop spraying that went bad and
cost the company a lot of money. He was ready to resign because the situation was just
shameful to him. His boss at that time said to him, “Ben, you’re the least likely person to ever
make that mistake again. You can’t leave.” Branch became a huge advocate of taking risks. I
didn’t know Ben all that well when I worked for Dow, although I got to know him during my
last years at Dow and afterwards. The Shintech and Shin-Etsu connection was part of that.
ULRYCH: That’s right. He was very close with Dr. [Chihiro] Kanagawa. So what you are
saying is that freedom to take appropriate risks was part of the Dow culture.
Here’s an interesting thing, although it’s off on a tangent. In ’87, you became co-chair
of the Bulgarian-US Economic Council. What was that all about?
POPOFF: The International Chamber [of Commerce] prides itself on US-Japan, US-France, et
cetera, trade and economic cooperation organizations. Bulgaria didn’t have one, so I got a
couple of phone calls and we set one up. I don’t know what ever happened to it. I think it was
there more for appearances than to achieve project development or financial interfaces. Trade
relations were beginning to loosen up under Todor Zhivkov. I chaired the council for a while
and then moved on.
ULRYCH: You were in Bulgaria for that?
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POPOFF: Yes. I’m not involved with the Bulgarian state anymore, just with individuals.
ULRYCH: How about the Bulgarian-American community? Do you do anything with that?
POPOFF: We’re pretty amorphous. We’re pretty diverse. It’s hard to find Bulgarians; there
aren’t too many of them. I do know of a Bulgarian-Macedonian community in Flint, but I’m not
involved with them.
I had a marvelous experience with a Bulgarian physician who was sent to the United
States on an exchange program with the US Navy in the late eighties, 1988, 1989. It was a
three-year assignment. His son developed cancer. The family was in Washington DC. The
father, Dr. Roman Hitchev, called me. I didn’t know him at all. He said, “Mr. Popoff, you
don’t know me. I'm Bulgarian. Here’s my situation.” He laid it out: “I'm due to go back to
Bulgaria in six months. If I do, my son will die. He will not get the kind of treatment for his
leukemia that is available to him here in the United States.” I'm listening. He said, “My family
and I have decided to defect. Can you help me get a green card?”
I’d been through that a few times before. I did help him, both financially a little bit and
with some of the formalities. Now he’s a leading authority on organ transplantation in the
world. He’s a gifted physician, but he couldn’t become a doctor right away. He had to go
through the drill to get accredited in the United States.
While he was working in a lab, he recognized that in Eastern Europe there are all sorts of
people who die from a variety of causes and would make wonderful organ donors for recipients
in the United States. They have no infrastructure for transplantation in the East Bloc. They
really have no infrastructure for harvesting organs. He began to work with the harvesting of
organs in the East Bloc to be sent to the United States. The premise was that they would build
an infrastructure for not only harvesting, but also eventually for transplantation. Now they’re
pretty far along the road. It’s Bulgarians like that who make me really proud.
Speaking of defection, Ursula Tarzy was a bright, young, good-looking chemical
engineer in Poland. We had a lot of success with women in the labor force in the East Bloc.
Ursula was the head of our Warsaw office. She came into my office around 1981, ’82, ’83. I
said, “It’s good to see you, Ursula. You’re here for the holidays?” At that point, things had
begun to liberalize a little bit in terms of letting people travel. She said, “Yes. I went to a sales
meeting in Vienna, [Austria],” which was the hub of our East Bloc operations. “Now my
husband and I are here in Zurich with our children.”
I said, “That’s great. When are you going back?” She said, “We’re not going back.
Can you help me?” [laughter] I said, “Ursula, do you understand our situation? If we help you
defect, we’re going to have hell to pay in Poland. The next time we go to the representation
agency for an employee, they’re not going to give us the pick of the litter.” Back then, you had
56
to go to a special agency for employees. You couldn’t solicit them directly. That’s how we got
a lot of good people, including Ursula.
If we were seen as helping her defect to the United States, we were not going to make a
lot of the locals in Warsaw happy. I thought about this, and I asked her, “What does your
husband do?” She answered, “He’s a computer engineer.” So we got him a job at Dow Canada.
They slipped under the radar and went to Canada, where she became a very successful insurance
salesman. They’re doing fine in Toronto to this day.
You see things like that, and you just shake your head. That’s why I say the relationship
with nations is really the relationship with people. If you say Poland to me, I’ll say Ursula. If
you say Moscow to me, I’ll say Yury Golubev and several others.
ULRYCH: While you were CEO, the whole political situation in Europe changed dramatically.
Did you anticipate that?
POPOFF: Not as much as perhaps I should have. I knew change had to come, but the decline
of the Soviet Union escalated very rapidly. I met several of the Eastern European leaders, and
they seemed to be not only in control, but reasonably competent.
ULRYCH: Of course, you didn’t anticipate that the Soviets would allow countries to basically
break away.
POPOFF: We lived through the [Alexander] Dubček, [Ludvík] Svoboda Czech summer. We
watched the Hungarians become pretty independent two or three years before the [Berlin] Wall
came down. We even built a plant in Hungary during that period. But no, we did not anticipate
the Soviets letting go of some of their key assets. If you’ll recall, Romania had kind of thumbed
their noses at the Soviet Union a little bit. [Nicolae] Ceauşescu felt he was bigger than life, and
the Russians bought that. Tito’s independence of course predated all that.
ULRYCH: When you saw the system was coming to an end, what did you anticipate would be
the opportunities for Dow?
POPOFF: It was a huge opportunity for Dow because we had infrastructure and people in
place. If the commercial climate was relieved, then basically there was business to be done and
serious demand to be met.
An opportunity dropped in our lap. We got to know the lady who was in charge of the
Treuhandanstalt, the East German privatization initiative. Her name was Birgit Breuel. She had
57
been the secretary of the treasury for the state of Hanover. We got to know her through our
involvement in Northern Germany. She contacted us and said, “I’ve got some property in East
Germany that you guys might be interested in.” I asked her, “Birgit, what’s so wrong with it
that BASF, Bayer, and Hoechst don’t want it? I’m sure they were given the first bite of the
apple.” She said, “You’re right. They want no part of it. It’s got big problems, but it’s a
valuable facility.”
You don’t have to be a fellow at the Chemical Heritage Foundation to know that was
really the epicenter of the old IG Farben enterprise in Saxony and in Saxony-Anhalt. There was
this large complex [Buna Sow Leuna Olefinverbund GmbH (BSL)] I had visited several times
under the East German era. It had environmental problems and problems with logistics. It
wasn’t on open water. It used brown coal, lignite, for energy, et cetera. I said, “Birgit, what
have we done to make you angry with us?”
She said, “Look, we will move mountains to get that thing properly handled. We don’t
need the rest of East Germany coming to West Germany; we need jobs in East Germany that
will hold people in East Germany. We’re dependent on US employers. So far the only people
who have been interested in it are people like Lufthansa [German Airlines] who will build a
maintenance facility there. No one’s willing to put much money on the ground.”
I told her, “We are like most people. We don’t have money.” She said, “We do. What
do you need?” We thought it through. We needed pipelines to the North Sea. We couldn’t be
dependent on anything but pipeline transportation. We needed carte blanche on all
environmental issues. We needed regulatory situations squared away. We needed a diminution
of the workforce from being huge under the Communist era to appropriate by Western
standards.
ULRYCH: They bought into that right off the bat?
POPOFF: No, but they eventually gave us everything we wanted. They knew they’d worn out
their welcome with everybody else that might be a player, the big three Germans. We were now
their best game, so they came around. Pedro Reinhard and Elmar Deutsch in Europe were the
two who really glued it together. I talked to Birgit initially. She let Elmar Deutsch know that
she wanted to talk to me. Afterwards I said, “Fellows, let’s get it done.” It’s been a big success,
as you probably know, and it’s our window into Eastern Europe. It’s a low-cost facility, and it’s
done everything we had hoped for.
Selling it to the board was really a nightmare. “Gentleman, we’ve got this wonderful
proposition.” They said, “Oh really? Tell us about it.” I didn’t want to tell them about the
environmental issues, regulatory issues, logistics issues, technology issues, and energy issues.
The board said, “Can we see it?” I said, “No. If you see it, you’ll reject it. Take me on my
word that it’s in our best interest.”
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ULRYCH: You had seen the plant before?
POPOFF: Oh sure. It was a mess. I was a regular at the Leipzig Messe, the fair in Leipzig,
which is a stone’s throw from Buna, Leuna, and Sow, the three factories that were part of this
deal and are today BSL.
I said, “I’ll make a deal with you. If you approve this, I’ll get a walk-away provision.
We’ll walk away at the end of five years if all the conditions aren’t met. I’ll also take you there
halfway through the five-year renaissance.” They agreed.
ULRYCH: When was this offer made?
POPOFF: Maybe ’91. It was very, very controversial in Germany. The press said, “Why are
we giving away our assets to foreigners?”
ULRYCH: Was this the national press or just the local press?
POPOFF: The national press. I'm talking about Bild, Blick, all the big periodicals and
newspapers. Frankfurt Allgemeine had big headlines. I said to the board, “If we do this, I’ll
take you there.” We got started, and halfway through we took them there. They saw what
needed to be done and what had already been achieved. They were pleased.
We met in Bonn, [Germany] with Helmut Kohl at his office. I had a director, Willie
Davis, who was a former player for the Green Bay Packers, a terrific guy. Willie’s as big as
Kohl, and Kohl is a huge man. It was photo op time; people were taking pictures. Kohl was
considered a little countrified, compared to the acerbic Helmut Schmidt, who was a proud
northerner, very decisive, and spoke perfect English. Kohl understood English, but he didn’t
speak it.
Kohl said to the photographer, “Come here. I want my picture taken with this man.”
Willie said, “Why with me?” He said, “I want to take it home and show my wife that there are
people as big as I am.” [laughter] Apparently he was under some pressure to go on a diet.
I admired Helmut Kohl immensely. The unification would not have happened without him.
Had he not had the guts to say “ostmark and deutschemark at parity,” there would have been
hell to pay.
We had a great meeting at the factory. We spent a weekend in Berlin. We went to Bonn
and saw Helmut Kohl. Then we went home, got support, and were told to please proceed.
“Why aren’t you doing this or that sooner?,” they wanted to know. [laughter]
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ULRYCH: I know that the whole process ended around 1999 or 2000. It took quite awhile.
POPOFF: There were a lot of things that needed to be done. The bulk of it was done earlier
than that, but part of our deal was to bring satellites to the location. We brought plastic
converters to the location and other customers of Dow’s to the location. They got good value in
terms of an excellent workforce, good infrastructure, and German chemistry.
ULRYCH: I know there was a book done on this, The Chemistry Must Be Right.4 It came out
in 2000 and was published with the help of Dow.
POPOFF: I’d love to see that. By 2000, I had retired. My last interface was in 1998 or ’99.
We had a joint BSL board, and they ended up at my house because the country club didn’t have
grappa. They wanted grappa, and I said, “Well, I may have a bottle or two in the house.” I
wound up surprising Jean at midnight with visitors.
I’d be curious to see that book. I remember I got choked up. We had small buses for the
directors and the management team that was touring the plant. The lady who was the guide on
our bus picked up the microphone and said, “Before we start, I’d like to tell you that I'm a
chemical engineer. I'm a single mother of three. English is my fourth best language. I'm fluent
in German, French, and Russian. I was scared stiff when this all happened. It’s worked out
well. Thank you very much.”
ULRYCH: There was no way that everyone’s job could be preserved. There were many
people who had that unrealistic expectation.
POPOFF: They knew it was unrealistic. Many of them received some support and subsidy
from the government to leave. The Germans were generous all the way around. There was not
a huge disruption. Plus, Leipzig and several cities in the area were booming at that time, so we
didn’t see those people drop into a hopeless labor market.
ULRYCH: It was fortunate that there was a West Germany. The workforces of the companies
in Eastern Europe were as big as they were because that’s how many people needed to be
supported.
4
Rainer Karlsch and Raymond Stokes, The Chemistry Must Be Right: The Privatization of Buna Sow Leuna
Olefinverbund GmbH, 1990-2000 (Leipzig: 2001).
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POPOFF: Zero unemployment, that was the goal. Depending on where you go, people will
tell you privatization was good and bad, some better, and some worse. It was grand larceny in
some places like Russia and Bulgaria. Poland got it pretty right. The Germans obviously did
what you would expect from them.
[END OF AUDIO, FILE 3]
ULRYCH: Let’s discuss Responsible Care, eco-efficiency, and sustainable development.
POPOFF: Responsible Care predated me. I just happened to move into the chairman’s job at
the CMA [Chemical Manufacturers Association], which is now the American Chemistry
Council. I go back to the MCA, the Manufacturing Chemists’ Association. That was long ago,
but I think they continue to do good work.
Okay, Responsible Care. The industry had learned far before my involvement that
you’re either part of the problem or you’re part of the solution. They chose to take the
initiative—not only talking the talk, but walking the walk—by putting out some solid standards,
which were essentially prerequisites to membership in the then-CMA.
That took some years to determine because it was contentious. Some things had more
impact for large companies versus small companies. By then, distributors had come into the
association. On and on it went, but finally we hammered out Responsible Care as a concept.
Then the hard work began, that of ensuring everyone was compliant. And what can you do?
You can make sure that your organization is absolutely on board, and you can use whatever
bully pulpit you may have to assure other people that it is not only in their best interest, but it’s
mandatory for the industry to survive without pulling down the animosity and the ill will of
society, which the chemical industry on occasion is capable of doing.
It was a journey, one I'm glad I was party to. There were a lot of ramifications. We tried
to take it overseas, and we did to some degree. Each country has its own spin on Responsible
Care, although it is a US-centered initiative. Hopefully US companies practice it around the
world. We learned early on that we weren’t always invited to the party, and that gave us
guidance in crafting Responsible Care.
I remember the first Earth Summit in Rio de Janeiro, [Brazil] in 1992. Heads of state
from 140 countries participated. All sorts of NGOs [non-governmental organizations] were
invited. Everyone seemed to be invited except the chemical industry, or industry in general. A
number of people contacted me from all over the world—a gentleman from Henkel in Germany,
Mr. [Takeshi] Hijikata from Sumitomo, a variety of people—and said, “What’s going on? I
understand there’s this Earth Summit. Shouldn’t we be there? If we’re not, we’re going to be
beat up even worse than we usually are.”
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So we put our heads together. Maurice Strong, a Canadian, had been seconded by the
United Nations to chair the Earth Summit. We asked him, “How can we get an invitation?” He
thought about it. Initially he said, “I probably can’t get you an invitation.” He thought about it
some more and said, “Look, I’ll get you an invitation, but you have to form a new group. That
new group has to have someone of my choosing as its chairman. I'm going to be pretty
doctrinaire in terms of what my expectations are.”
We said, “At least it’s an invite.” He nominated [Stephan] Schmidheiny from
Switzerland to be the chairman. Schmidheiny and his family had been huge in the cement
industry and had some enormous environmental problems. Stephan was really seen as a
forward-thinking, future-oriented industrialist in Europe and around the world. Maurice said,
“If Stephan is willing to do it, put your group together.”
We did, and Stephan was super. We went to Rio expecting to be bashed. Of course, you
know what happened in Rio. It wasn’t about industry versus the environmentalists; it was about
north versus south. While the north was advocating all manner of reform, the south was saying,
“Pardon me, we’re at that phase where you were one hundred years ago in your economic
evolution. We reserve the right to cut down a few trees and mine some real estate.”
Sustainable development got to be quite an interesting concept. I put it along with
Responsible Care as the two wheels on the bicycle. Sustainable development said there could
be no environmental reform without industrial development, and there could be no industrial
development without environmental responsibility. It seemed to me that was a good way to get
everybody to back away from being one hundred miles apart and ramming together at full speed
with nothing to show except bumps and bruises.
Responsible Care and sustainable development became good vehicles to get people
talking. I think a lot of good things have come out of them. We are not as far along as we need
to be—I guess we never will be—but I think the industry can be appropriately proud of its role
in the environmental movement without being naive in terms of the need for industrial
development. If everybody has a full stomach and a good job, there probably won’t be too
many people fighting or causing mischief to each other or damaging the environment. But
we’re a long way from there, aren’t we?
ULRYCH: Yes. You became quite a proponent of sustainable development going beyond
Responsible Care, with the whole notion of eco-efficiency.5 Looking back, have your views
undergone any change?
5
Livio D. Desimone and Frank Popoff, Eco-Efficiency: The Business Link to Sustainable Development
(Cambridge: MIT Press, 2000).
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POPOFF: No, but I give myself only a “C” in terms of what we’ve been able to achieve. I'm
pleased with the progress, but it’s never enough. I got some push back from the industry, and I
got a lot of push back from the environmental community. My concept of eco-efficiency was
built around life-cycle analysis. It entailed measuring the impact of the project from the raw
materials first purchased to post-consumption disposal. If you look at just a slice, you may be
misleading yourself as well as others.
Of course, everybody said, “Popoff, why are you going that far back? You’re telling me
that when we evaluate Procter & Gamble’s disposable diapers, we should evaluate trees and
fiber as well as hydrocarbons and energy?” I said, “Folks, the world is already doing it for us.
Yes, I understand it’s tough. Yes, I understand you don’t control all the elements. But we have
to stay with it.” A lot of people came on board, but there were still a lot of people saying,
“Don’t overreach. You will ultimately alienate some of your supporters.” We pushed as hard
as we could, and I don’t think we alienated too many people. There’s always more to be done.
ULRYCH: You were making the argument for full cost accounting.
POPOFF: Yes. The CEO of Union Carbide [Robert D. Kennedy] called me and said, “Frank,
you’ve gone off the deep end. How can I possibly know the full cost of what my supplier’s
supplier is doing?” I said, “Bob, we better learn in a hurry.” We had some good debates on
that. I think people pay attention now.
ULRYCH: What about the notion of having the price of the object reflect its total cost? That is
to say, if I as a consumer am buying those socks over there, I'm not only buying the socks for
the time that I use them, but for the time of disposal and the environmental impact of the socks.
POPOFF: That was a concept I thought was worth consideration. Not everyone agreed, but I
think we made some progress. At least we generated awareness.
ULRYCH: Another related idea concerns a country like China, which does not give any
thought at all about passing the full cost accounting along to the consumer. How does a
company compete in that environment?
POPOFF: The answer is that some of these initiatives render you less competitive. You have
to try to overcome some of your shortfalls or some other people’s advantages by trying to do
other things better. Sometimes you succeed, and sometimes you don’t. Sometimes you price
yourself out of business, and sometimes indeed the market accepts what you’re doing. You
recognize that the message is beginning to seep in.
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ULRYCH: The thing is, you may price yourself out of the marketplace, but what you were
doing may have been from the environmental standpoint far better than what your competitor is
doing. Is that a plus or a minus for society?
POPOFF: That depends on to whom you’re talking. To some unrelenting shareholders, that’s
not the best idea in the world. Most people understand that if you’re as big as Dow, above all
you’ve got to maintain a reputation that’s synonymous with best practices, be they employment,
environmental, or financial. You have to maintain a standard that is difficult for you to achieve,
but motivating, one that helps you do many things.
I can’t tell you how much energy we saved by virtue of really digging in and
maximizing our energy conservation programs. Like I said, I give myself a “C” overall. I think
we’ve made some real progress, but there’s certainly no victory to be declared yet.
ULRYCH: The whole CO2 emissions issue is precisely what you’re talking about.
POPOFF: There’s that. We know carbon dioxide emissions control can pay off in the context
of an aggressive energy savings program. There are a number of ways we can make a
responsible choice when we buy something as an industrial or private consumer, and eventually
full cost must be recognized.
ULRYCH: Either you, your children, or your grandchildren will eventually pay full cost.
POPOFF: If something’s being subsidized in some way, that bill’s going to show up sooner
rather than later. If we subsidize energy, that’ll show up. If we subsidize manufacturing, that’ll
show up. It’s eventually a game of pay me now or pay me later.
I think it worked reasonably well. I don’t think we priced ourselves out of much at all.
People did not pay full cost, but they paid enough so that you could responsibly promise those
people that the product would continue to be available in the quality and at the service level they
demand. It’s the old argument that you go through as freshmen in school: What’s the most
important mandate that business has to serve? Is it your social responsibility, your profit
responsibility, or your service responsibility? Great arguments are held on this subject.
I think you have to provide a service. It all starts with that. I don’t know of anybody
who makes a profit by going out on the street and declaring, “I'm here just to make a profit.” Or
anybody who says, “I’ve met all my social objectives. Aren’t you happy for me?” I think first
of all you have to provide a service, a service for which people are willing to pay adequately to
perpetuate its continuing availability. Hopefully that generates a profit for you, and with this
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profit you can be a responsible citizen for society and pick up your share of the burden that has
to be born.
It’s not an either-or proposition, but it starts with service. It starts with what you do and
how well you do it. If you do it well enough and people value it adequately, you’ll perpetuate it.
You’ll generate enough income to continue to mold yourself and your enterprise into that
socially responsible entity that we all aspire to be. It’s not a great conundrum; it is a
sophomoric exercise that we all have to go through at one time or another.
Profit is a byproduct. People say, “Frank, you’re wrong. How can a CEO say profit is
not job number one?” Ostensibly, you run your company so that you can not only perpetuate
what you do and satisfy your owners, but you can also then address some of the longer-term
issues that are pivotal to your future.
I used to preach at Dow about issues management. I'm sure that’s somewhere in your
notes. There are six issues that have to be dealt with: competitiveness, trade, environment,
education, technology, and corporate credibility. They’re not the same six issues for everybody,
but they are sequential. You’ve got to get them right in sequence. If you do that right, you can
look back and say, “That was not a fool’s errand.”
ULRYCH: In 2000, you retired. Were you ready to retire?
POPOFF: I was. I had worked on the transition to Bill. I had a number of other irons in the
fire. If someone had said, “Frank, stay on a little longer,” I’d have said, “That’s interesting.”
But that would have been inconsistent with the promise that we make to the next generation of
management and that they make to the next, and so on. It was time for me to move on. Sixty
may be a little young to retire as CEO, but I was busy until age sixty-five as chairman.
Frank Popoff at his retirement party
65
ULRYCH: In today’s world, sixty is young.
POPOFF: In today’s world. By Japanese standards, certainly. But I was ready. I stayed busy
with several other companies and was involved with some projects in the community. I was
pleased to serve as the chairman of the Chemical Bank here in town for a short time. I was
active with the [Herbert H. and Grace A.] Dow Foundation, and I was on a number of boards. I
got to teach a little bit at Indiana for three years [2001-2003]. There was plenty to keep me
busy.
ULRYCH: Did you teach in an adjunct capacity?
POPOFF: Indiana’s was an interesting concept. All of us endow a chair sooner or later. Red
Poling from Ford did a clever thing. He endowed a chair not to support a professor, but to
facilitate visitors coming in to bridge the gap between university, industry, and government,
which was always a pet subject of his. IU’s Kelley School of Business would alternate people
from industry and people from government as visiting professors. I think the first person they
got was Sam Skinner, who was secretary of transportation. Then they got Randy Tobias, the
CEO of Eli Lilly. Then they got [former Indiana governor and senator] Evan Bayh. Then me.
It was a two-year assignment. I stayed on for three years at their request. I would spend
essentially three to four weeks every spring and fall in residence in Bloomington dealing with
mostly graduate classes, but also undergraduates to some degree. I had almost full freedom to
address what I wanted, but I did it under the aegis of addressing classes such as Finance 407 or
International Business 593. I was in somebody else’s classroom pitching in. They were carving
out time for me, ready to resume the responsibility for the class after I left. This practice
worked out quite well.
ULRYCH: So you tailored what you taught to the content of the course?
POPOFF: I tailored it with their needs. Yes, absolutely. It wasn’t just pontification by Frank.
That would have bored everyone to death and not served the purpose that was intended. I
applied what I had learned to the subject I was asked to speak about. It was fun, but boy, it was
challenging.
I taught in the aftermath of the dot-com crisis. There were a lot of kids coming back to
school after being terribly disappointed with their first foray into business. They were not
children; they were in their thirties and even in their forties. They had a lot of hard questions
and were very challenging. They would ask, “What’s so good about this system of ours? Look
66
at what’s happened. Look at how it’s impacted me personally. Are you prepared to defend it?
Isn’t there a better way?”
You can imagine how they felt. After all, how would you feel if you thought you had a
bright career and then suddenly boom, along comes the dot-com situation? You’re out of work,
and you can’t find something appropriate. What are you going to do? You decide to go back to
school, but you go back with a chip on your shoulder. I remember teaching a session just before
graduation. A young man stood up and said, “Mr. Popoff, I'm wearing a blue suit. I have a
white shirt, and I have a tie. I’ve got my hair cut. My grade point average is a 3.7. I don’t do
drugs, and I don’t have a criminal record. Why the hell can’t I get a job?” De facto, what’s
wrong with this system? “How can you defend this system if it doesn’t provide me
employment?”
ULRYCH: No one from your generation would have asked that question.
POPOFF: Right. It’s a sign of the times. Like everybody else, I urge women and minorities to
go for the sciences and for engineering. I recently met a physician’s assistant at MD Anderson
[Cancer Center] with a daughter in Houston, Texas who has a degree in chemical engineering.
She’s been looking for a suitable job for three or four years.
I said, “Can I have lunch with her?” We talked. I called a few people, but nothing came
of it. Three or four months went by, and I heard she has a job now. Still, she had languished for
three, almost four years with this sparkling degree in chemical engineering unable to find a job.
She did find a job, but not with a major chemical company. (Dow is laying people off even as
we speak.) She got a job with a chemical engineering contractor. A lot of work is going to
contractors because employers aren’t willing to take on a big payroll. It’s so wrong when you
think about how much time you spend on training people and how valuable they become. Then
you let them go, and you farm business out. I don’t understand that.
ULRYCH: I'm going to ask a question that relates to some of the things we were talking about
earlier. Do you think public perception of the chemical industry has improved in the last
decade?
POPOFF: Yes. I think it has, but it had a long way to go. We were the archetypical bad guys
there for awhile. Now I don’t think we are. I think we’re just seen as another industry that has
its work cut out for it. We’ve made progress. I don’t think we’re singled out as much as we
once were.
To answer your question properly, what bothers me about the chemical industry is that
we are less relevant as an industry than we ever were. Chemistry as a percentage of the GDP
[gross domestic product] has slipped. Chemical companies have consolidated. When I joined
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Dow, we were the fifth or sixth biggest chemical company in the United States and had yet to
broach the billion dollar mark. Now we are number one, but the list has consolidated. I look
around now, and it’s interesting. We acquired Carbide, which was part of the Dow Jones
[Industrial Average] 30. Our people said, “Won’t we be now?” The final acquisition of
Carbide happened as I was just about to turn the lock on my office in 2000. Dow Jones said,
“We’ve got one chemical company in there. Isn’t that enough? We ought to look at Home
Depot or somebody else in another industry.”
We did not pick up Carbide’s presence in the Dow Jones Industrial Average. I think that
makes us less relevant, hence we probably get less attention. Arguably, that means there’s less
animosity, but there’s less reason for animosity. People who take a look at us respect who we
are. I think we’re perceived better, to answer your original question. Maybe the problem is that
we’re just not perceived enough.
ULRYCH: There’s the chemical industry, and there’s a really broader range of chemical
industries that go unnoticed, things like pharmaceuticals.
POPOFF: And biosciences and semiconductors. Chemistry is everywhere, but as an industry,
the chemical industry is not what it used to be. It’s true even in Germany. Have you read some
of the early books about IG Farben?
ULRYCH: No, I have not.
POPOFF: They’re fabulous. I have a few of them. Complete with all the issues of World War
I and World War II, there was this attitude in Germany, “We can solve it with chemistry. We
don’t have fertilizer? Well, we’ll find out how to fix nitrogen out of the atmosphere. If we
don’t know how to make something, we’ll put high temperature and high pressure together,
engineering and chemistry together. We’ll turn the screws, and magic things will happen.”
The chemical industry was the industry to be in. Now I'm not so sure that people say,
“Wow, your future is in the chemical industry.” The periphery of chemistry is very wide and
broad, but the industry per se doesn’t have the appeal it did in the sixties, when Dustin Hoffman
was told, “One word: plastics.” Do you agree or disagree a little bit?
ULRYCH: I would agree. Media also continues to portray a bias or prejudice against the
chemical industry. If they depict a chemical company, they’re always dumping something
somewhere surreptitiously, paying somebody off, or not caring about the impact on people.
You can see that in the programs being made for television today. This was not the case from
media twenty years ago.
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POPOFF: We’ve made some progress, but there’s still a long way to go. I think people who
have delved a little deeper give us good marks, but there’s still this image of irresponsibility.
It’s unfortunate. You can’t complain about it. You just have to ensure that you do everything
possible to improve it. Good operating and financial performance certainly helps.
When I was CEO at Dow, to my mind, it was possibly one of the best times that Dow
enjoyed. We had record earnings. We had big dividend increases, major stock appreciation,
stock splits, and all that go with it. We were very aggressive about who we were and what we
wanted to do. It wasn’t an easy time. The early eighties were very tough. The middle eighties
were better. The nineties saw a recession. During the tail end of the nineties, I used to say to
Bill as a new CEO, “The chemical industry is accused of being a no-growth industry in the dotcom era and the boom era in electronics. We will be under continuing pressure on earnings.”
We fell afoul of people who would help us whether we needed it or not, people like
security analysts and institutional investors who would coach us to do things that were both
counterproductive for short-term management and not necessarily in our shareholders’ best
long-term interest. I always felt we should spend as much time selecting our owners as our
customers.
I left in ’95 as the CEO, when we had a strong year. We went into a period in the later
nineties where we were doing okay, but not nearly as well as the boom in other industries. The
analysts spent a lot of time telling management how to run the company. They reckoned if
you’re not growing, then you have to cut costs. We cut costs and let a lot of people go. We
backed off on some good research.
You can only cut costs so far. As soon as we stopped cutting costs, those same analysts
said, “That was nice, but you guys have forgotten how to grow.” That led to the Union Carbide
acquisition, which was done because we’d lost our way in many respects regarding growth. In
terms of internal growth, we had failed to understand that the best thing you can do with your
time, talent, and capital is to harvest your own invention. That’s what really brings home the
big bucks.
If you have money left over after you’ve done that, you can grow geographically or
through line extensions. You can grow through a variety of internal initiatives. The last
initiative is to grow by major acquisition. Why? With acquisitions you pay a significant
premium. Most acquisitions aren’t as successful as the investment bankers would purport.
[laughter] Yet, it was the alternative to someone saying, “You’re not growing.”
Major acquisitions often aren’t a recipe for real shareholder return. Small acquisitions
and add-ons are terrific, but massive acquisitions are a tall order. I think Carbide was a
reasonably successful acquisition, but it wasn’t the homerun that we had hoped it would be. We
wound up closing down a lot of their plants because of the downturn in the economy. On the
other hand, we also put together a lot of good technology. It balances out. Internal growth,
however, would have been more rewarding.
69
ULRYCH: Which had already been taken off?
POPOFF: Yes, but slowly. You can’t go through this massive cost-cutting operation without
diluting a lot of your internal initiatives for growth.
ULRYCH: It’s been argued that Dow’s moniker as the “growth company” was no longer true
after 1995, that your time as CEO was really the high watermark of Dow.
POPOFF: That bothered me because we really were by now 60 to 65 percent institutionallyowned. We were at the mercy of the analysts. Times were hard. We had new management.
We did what I'm sure everybody else in the industry did at that time. We said, “Maybe we can
save ourselves into prosperity.” I don’t fault anybody for it. We had a tremendous challenge,
and we met it in the only way that we felt was available to us.
ULRYCH: In other words, the market analysts were putting on pressures.
POPOFF: Yes. The advice was unrelenting. I’m sure it also came from some of our board
members.
ULRYCH: That’s another thing to talk about, the transformation of the Dow board.
POPOFF: When I was a director and when I was CEO, I knew I had in that room some people
who knew where all the bodies were buried, [laughter] who knew the company like the inside of
their pocket. There was no kidding them on what was good, bad, or irrelevant. You had to
deliver on the promise that was expected of Dow. Today, in an environment of “independent
directors,” outside directors can help on numerous issues, but they lack the in-depth industry
and company knowledge that inside directors have.
I belonged to several directors’ associations where insider directors were anathema and
challenged on the premise that they would be too supportive of management at the expense of
shareholder interests. That is usually a flawed premise. But now the reality is that we have
fewer and fewer inside directors.
ULRYCH: That transformation occurred very quickly?
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POPOFF: Yes. Corporate governance became a big issue, as if it had not been a continuous
concern. I served on several panels, and we listened to all manner of people who said, “This is
the way of the future.” Indeed, it was, but it did not serve us well.
ULRYCH: Could you talk about what you think were the factors that led to Michael Parker’s
unfortunate tenure?
POPOFF: Mike was from central casting for that job. He had production experience and had
been to Texas as a trainee. His first job with Dow was in the Texas operations, although he was
a Brit all the way. He then went to Europe. He had a commercial job, ran a family of products,
ran a region. He then came to the US for care and feeding and de-Europeanization. [laughter]
We joked about that. He did a good job here and had good marks. He then went to the Pacific
and received good marks as area president.
He came back and was the heir apparent, no ifs, ands, or buts. But Bill was late in
working Mike into the equation. I wish he’d given him a year as the heir apparent so that he
could work his way in and be comfortable. In fact, he didn’t get any time at all. It went right to
the eleventh hour with Bill.
ULRYCH: Why was that?
POPOFF: CEOs are often concerned with the possibility of lame duck status. Bill also was
CEO for a relatively short time and perhaps wished to stay on as CEO past age sixty. We knew
Mike was waiting in the wings, but at the same time Pedro Reinhard was coming up fast on the
financial side. He did a great job with BSL. He did a great job with a lot of things.
He was my CFO in Europe. Hunter Henry wanted him out of Brazil. I took him from
Brazil and was delighted with every day we spent together. He saw himself as a contender, as
did some outsiders and some insiders. He was well-regarded by the financial community.
Many of them were putting pressure on us to consider him.
It became a contest between Mike and Pedro. Each had to appear before the board and
make a speech on why he was the man for the job of CEO. It was dreadful.
ULRYCH: Nobody had ever done that before?
POPOFF: Of course not. This business about the board choosing the CEO is absolutely right
as it should be, but they need to be walked through the decision-making process so that the
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conclusion comes out right. In earlier times, the outgoing CEO usually picked the new CEO,
and the board concurred. In this case there was a board vote, and Mike was declared the winner.
The process was divisive. Mike could not have gotten off to a worse start. He didn’t have the
support of Pedro and a group of people within the company.
ULRYCH: There was some animosity left over?
POPOFF: Tony Carbone, who may have seen himself as a candidate but maybe was a bit too
old, didn’t buy Mike. He was very close to Bill. He didn’t support Mike. He was a member of
the board. Pedro was a member of the board.
ULRYCH: There were still some inside board members?
POPOFF: It was 1995, and the beginning of the end of inside directors. We wound up with
this tough situation when Mike became the CEO. I think he overcompensated for that. Also,
the economy was difficult. Mike was accused of talking too much and listening too little, a
quality of which we are all guilty. Somehow the rug came out from under Mike. I got phone
calls from directors. By then, I was spending my winter months trying to ski as much as I could
in Colorado, something decelerating chairmen get to do.
I would get phone calls. “Frank, have you talked to Mike?” “Frank, what’s wrong?”
There wasn’t a lot wrong, but there was a perception that there wasn’t a lot right either. Slowly
but surely, Mike’s support abated. His last address to this was to get on an airplane and visit
each of the directors one on one. By then I had retired as chairman and was replaced by Bill, so
I have no direct knowledge of what exactly occurred. Apparently, those one-on-one sessions
did not go as well as they might have. Three directors came into his office after a subsequent
board executive session and said, “Mike, we’re asking for your resignation.” He was in total
shock.
He called me and said, “Frank, what is going on?” I said, “Mike, we’ve talked about
this.” He said, “I know, but I didn’t think it was to this level.” I said, “I didn’t either.”
ULRYCH: Was there a vote in the end, or did the three directors just ask him to resign?
POPOFF: I don’t know if there was or if there was unanimity. I was gone by then [December
2002]. Bill was again CEO. He served well for a couple years. The board did not change any
succession rules. Andrew [Liveris] came in after that.
72
ULRYCH: Do you want to say anything about Andrew Liveris’s reign?
POPOFF: I think Andrew is bright. He’s a victim of changing times. We’ve had three or four
different strategies at Dow during his tenure. First we were going to get out of basics and be a
specialty chemicals company. The acquisition of Rohm and Haas [R&H in 2009] was the
centerpiece of some of that.
We paid way too much money for R&H, and we did not do some of the things that
you’re taught to do. We had no material adverse consequences clause, and so we could not ask
for a relook when the Kuwait deal clearly cratered. It was obvious that we had paid at least
eight billion dollars more for Rohm and Haas than it was worth. We had been misled that
BASF was waiting in the wings to pounce if we didn’t close quickly. The whole situation was
tough for a new CEO. Andrew really wanted to prove that he was a great CEO. He wanted to
make a great impact, and that was one way to do it. We fell on hard times. Within weeks of his
saying, “Never cut the dividend. It’ll never happen on my shift,” we cut the dividend. With
massive debt and a bond rating one notch above junk bond status, Dow went into a major cost
cutting mode and let a lot of people go.
I didn’t say anything. I was well out of the loop. Andrew asked me to come in. I said,
“Andrew, I’ll tell you what I’d do. I think you should remain CEO, but I do believe that you
should give up your board seat at Citigroup. You don’t have time for Citigroup. You’ve got a
tough set of circumstances right here at home. That’s job number one. If you want to salve
some of your critics, give up the chairmanship. Be the CEO. Make one of the outside directors
the chairman. Let him pound the gavel as you say to the troops, ‘We’ve screwed up a little bit,
but it’s not the first time in Dow’s history. We can get out of this. Let’s all square our
shoulders. I’ll lead you to get the horse back on the track.’”
Andrew would not do that. He survived that. He’s bright, and he’s nimble. I don’t
know who Dow’s alternative would have been. Some argued that maybe someone who was a
senior from the financial fraternity with credibility with our lenders might be a good interim
CEO until someone else emerged. That wasn’t going to happen because the board felt a little
culpable too, I think. They had bought into the transaction with the Kuwaitis, with the Rohm
and Haas deal, and all that went with them. Andrew had a little bit of a tough siege and in the
meantime had to change strategies several times. Suddenly as the market changed, some of
what we wanted to rid the company of became attractive, and some of the new initiatives didn’t
have as much glow as we had hoped.
We’ll never know what the real value of Rohm and Haas was because we took it apart
and merged it into existing or new segments. I’m sure it’s doing well, but we’ll never be able to
measure what the real numbers are. Now with the advent of cheap energy, we’re going to spend
four billion dollars on the Gulf Coast. I think that’s terrific, but it is a reversion back to where
we were. We keep admonishing people, “Don’t forget the Swiss mountain climber. Never take
your foot off of something solid until your other foot is on something even more solid. Do not
change strategies without really knowing what you’re bargaining for.”
73
I think they are now on track. I'm watching carefully what’s happening with the exports
of energy. If we export energy to the point where gas prices in the US harmonize with oil
prices, the US advantage will have disappeared. That advantage should be used at home and
parlayed into jobs, industry, and opportunity, but Big Oil is pushing to export. We’ll see how
that four-billion-dollar investment on the Texas Gulf pans out. I think it’ll work out fine. Will
it be as good as it might be? We won’t know until we see the environment in which we’re
operating.
But I'm an Andrew Liveris fan. We need Andrew to succeed. We need him to really do
a super job and bring back some of the sparkle. At six dollars a share, we were a buy.
ULRYCH: I know. I should have bought then. [laughter]
POPOFF: We all should have. At thirty dollars a share, we seem to be stuck. And the debt
still hangs over our heads.
ULRYCH: It’s hard to believe that it was down that far, isn’t it?
POPOFF: We were judged a failed company. Andrew was judged by [Jim] Cramer as one of
the top five worst CEOs. Then he was the worst CEO. Andrew’s overcome much of that.
ULRYCH: It’s a testament to his talent that he survived that. It really is.
POPOFF: Exactly right. He’s a tenacious guy and a very bright young man. I think he’ll serve
Dow very, very well. I hope that the strategic initiative is all about the long term rather than
what’s le mot du jour for today. I hope we’re not chasing drama when we should be chasing
opportunity. I don’t think we are.
Some of the things we were willing to sell just drove me crazy. Ag carried the company
for a few years in the aftermath of Rohm and Haas. Dow Agroscience continues to be one of
our very best businesses, but we declared, “We’ll sell it if our debt gets downgraded another
notch.” At the annual shareholders’ meeting [in 2009], shareholders got up and said, “Don’t
you dare sell our ag company.”
ULRYCH: I know there were quite a few long-time Dow people who were critical of that
whole thing.
74
POPOFF: It hurt. Jobs were lost. Dividend income had been bedrock. Everybody felt the
loss, and some people became more bitter than others. I was hopefully never critical of
individuals. I was hopefully constructive with suggestions. Some were taken, and some were
not. But we’ve soldiered through that. Why? It’s a great company. It’s not a one-man show.
It never has been a one-man show.
ULRYCH: Certainly. You mentioned American Express a little bit earlier. Are you still
involved with them?
POPOFF: Yes, I am.
ULRYCH: How did you become involved with American Express?
POPOFF: They were looking for a director. I was a relatively new CEO. Jimmy Robinson,
who was their CEO at that time, was a member of the board of directors of Coca-Cola. He
knew Paul, and he inquired about me. Paul said, “Take a look at Frank. I think Frank could
serve you well.” Jim gave me a call. I went to New York and joined the board [in 1990].
ULRYCH: What were they looking for exactly?
POPOFF: I think international experience was a big piece. American Express was a very
American-oriented company. Their international presence is still less than it might be. Payment
systems are different in Europe, as you very well know, but Visa and MasterCard are there. We
were late to the party internationally. We fixed that through some alliances.
ULRYCH: It has a very impressive board membership. You’re a senior advisor along with
Henry Kissinger.
POPOFF: Yes. Most boards have an age seventy-two rule for some reason, but American
Express asked me to stay on past the age restriction as a senior advisor.
I’m a senior advisor along with Henry Kissinger and another fine gentleman, Vernon
Jordan. Our other senior advisor, whom we lost a few years ago, was Gerald Ford. So I am
honored to be a senior advisor there.
75
ULRYCH: What was it like interacting with them?
POPOFF: Vernon and I have been close for a long time. I count Henry as a very close
personal friend. Jean will vouch for me. We had some common interests, and we got to know
each other. We’re both members of a group in the Bay Area in San Francisco, the Bohemian
Club. It is known as a paragon of sexism and maleness, but it’s the most misunderstood group.
ULRYCH: You’re a member of the Bohemian Club?
POPOFF: I am. No apology intended. It’s a great outfit. It’s totally misunderstood, and they
like it that way. They love the mystique. The summer encampment gives members the chance
to spend as much or as little of a three-week period hearing a lot of wise people speaking off the
record on subjects of universal importance. That’s really the attraction.
ULRYCH: You were also on the board of NCR Corporation [formerly National Cash Register
Company]. How much knowledge did you have about electronics when you joined [in 1989]?
POPOFF: You join a board either to learn or to maybe share and teach a little bit. I wanted to
know more about the electronics business. Here was a company in Dayton, Ohio that had just
crossed the Rubicon in terms of saying, “There’s more to life than barcode readers, cash
registers, and the stuff of yesteryear.”
Along with Hewlett-Packard, they were some of the early adopters of servers in lieu of
mainframes. They probably would have done very, very well had AT&T not reached out and
embraced them in a big bear hug and acquired them. With that acquisition, I left. The board
was dismantled.
ULRYCH: How did the AT&T acquisition transpire in ’91?
POPOFF: AT&T was falling short in their address to data processing. They also had a very
unionized group of service people. AT&T thought they could acquire the technology and the
knowhow of National Cash Register and perhaps a non-unionized service organization. All that
made NCR very attractive to folks at AT&T.
We resisted the acquisition for as long as we could. AT&T kept bumping up the price.
A thirty- or thirty-five-dollar per share company became a fifty-five-dollar company, and that
was compelling. They gave us the old bear hug. Chuck Exley, Jr., our then-CEO, said, “This is
testimony to the fact that a sick horse can fall and kill a very healthy dog.” [laughter] It wasn’t a
76
happy outcome. AT&T eventually divested. NCR has since regenerated, and I hope they do
well. Again, it was acquired and then divested by AT&T.
ULRYCH: More recently you served on the board of US West [1998-2009], which became
Qwest Communications.
POPOFF: Another adventure. Telephony and telecommunications were changing. I was
asked to join the Ameritech board in Chicago. They were a huge supplier to Dow, and I said,
“I'm a little more conflicted there than I’d like to be.” But here was a nice company in Denver,
[Colorado], the smallest of the Baby Bells. They invited me to meet with Dick McCormick, the
then-CEO. There was a lot to be done. I joined that board, and we had a pretty good go. We
were in the cable industry. We were doing a number of things.
Along came Qwest Communications, which was the darling of Wall Street for several
years. Phil Anschutz, who is a great fellow and a good friend, had the foresight and money to
recognize that the best place to lay fiber optics was alongside his train tracks at Union Pacific.
The Williams Companies, if you’ll recall, got into fiber optics by laying fiber optic along their
pipelines. Given a right-of-way and the demand for fiber optics, it was a natural progression.
Qwest was a homerun. They reached out to acquire US West [in 2000]. Again, it was a
compelling offer. We recognized that as the smallest of the Baby Bells, we were limited in
being able to compete for bandwidth in these big auctions that were transpiring with cell phone
technology on the horizon. And so the acquisition came through. They asked about half of us
from each board to stay on the new board. They invited me. I said yes.
Then we ran into hard times in the controversy with our CEO [Joseph P. Nacchio] and
insider trading. The bloom fell off the rose a little bit with Qwest. We soldiered on and did a
good job for our shareholders. There came a time when I was lead director and I said, “It’s time
for me to move on.” I did. They did okay for a few more years, but then they were acquired.
ULRYCH: With regard to that insider trading scandal, were you taken by surprise?
POPOFF: As a new director, yes I was.
ULRYCH: Tell me about the United Technologies Corporation board.
POPOFF: That was a fun board. That was a company built by one of the great pioneers, Harry
Gray, who bought Carrier and Otis Elevator. He also acquired Pratt & Whitney, an aeronautics
business primarily in the airplane engine business, Sikorsky Helicopters, and several other add77
ons. It became United Technologies. I joined that board [in 1996], and it ran like a Swiss
watch. I hope I was a good director. I served on a number of committees and had a very normal
directorate.
ULRYCH: The last companies I want to talk about are Shintech and Shin-Etsu. How did you
get involved? I assume you followed in the footsteps of Ben Branch in some way, is that right?
POPOFF: I was a relatively late arrival to the Shintech and Shin-Etsu story. That came
together because Dow was the principle producer of vinyl chloride and ethylene dichloride, the
two intermediates for PVC, and Shin-Etsu had the best PVC technology in the world.
I don't know who the major players were way back when [in 1974], forty years ago, but
Shin-Etsu decided to build outside of Dow’s property in Texas. They called the new venture
Shintech. It was a joint venture between Robintech, Inc. and Shin-Etsu. Robintech fell on hard
times. Shin-Etsu bought out their interest. Mr. Kanagawa husbanded that thing from the very
first day. He was an export manager for Shin-Etsu when all this started and had been in charge
of licensing technology. He decided, “What’s wrong with practicing our own technology?” Mr.
[Shintaro] Odagiri backed him up.
Shintech became the end result. It has grown and blossomed, and it’s more or less the
epicenter of efficiency in the Shin-Etsu enterprise. It’s lean, productive, and very effective.
Shin-Etsu has since made acquisitions. They bought the Shell PVC business in Europe [in
1998]. They bought a PVC enterprise in Portugal [in 2009]. They had been in the PVC
business in Japan.
There was a little friction between Shintech and Dow. I was still in Europe when a big
capital authorization was required to build the next piece of vinyl chloride expansion. The
board was skittish. The management was skittish. It was decided to build these new facilities
employing a long-term contract to bind Shintech. That was not a good idea. Why do you need
a long-term contract with someone who’s joined to you by a pipe? They really didn’t have very
many other supply options. And in a long-term contract with terms, provisions, and lawyers,
you never get the escalators and the de-escalators right.
After a year or two, one party thought the other side was getting a better deal and the
other side thought it wasn’t getting a good deal, or that it wasn’t the same partnership that it had
been. Paul and Kanagawa had a little bit of a falling out. I came back to Midland, and Bob
Naegele and Ben Branch contacted me. Bob was running a piece of the corporate product
department at that time. He said, “You’ve got to get involved in this thing. We may lose some
of our good will with Shintech. In fact, they’re talking about building their own facility.”
I said, “There’s nothing wrong with them building their own facility, but let’s make sure
that what we’ve got in Texas is being managed well.” I had a dinner in Midland with Branch,
Harry Mohlman, Bob Naegele, Kanagawa, other Dow people, and some Shin-Etsu people. We
78
decided to be friends again, and it has worked out very well. I was CEO at that time. When I
stepped down as CEO and chairman, Kanagawa said, “Are you interested in joining the
Shintech board?” I said, “No. We need to let a couple of years go by so that I'm not conflicted.
I need to clearly be away from Dow and independent.”
A couple of years went by, and he asked again if I was interested. I said yes. He asked,
“Would you also be interested in joining the Shin-Etsu board?” This was rather remarkable
because I was the first gaijin to serve on an industrial board in Japan. There were Americans on
financial boards, but not industrial boards.
ULRYCH: You’re certainly the first for Shin-Etsu.
POPOFF: And the first outsider. It is still predominantly an inside board, but we’ve got a half
a dozen great outside directors whom we’ve added carefully over the years. In addition to being
the only non-Japanese, I’m the youngest guy in the room. They venerate age, and I love it.
[laughter]
ULRYCH: Especially since Dr. Kanagawa stepped down as CEO at eighty-four.
POPOFF: He is a terrific guy. He is still running the show. [Shunzo] Mori-san is a super
partner. They get along very well. It’s a very effective and capable board. On occasion Dow
and Shintech had their problems, but they were worked out.
ULRYCH: This is before you became CEO?
POPOFF: Definitely. The contract must have been forged in the early eighties. When I came
back, it was on the verge of collapsing. Both sides were wondering, “Where do we go?” They
took a hard look at St. Charles Parish, and that didn’t work out for various reasons. We patched
things up there and expanded with them in mind.
Then they said, “We’d still like to do something.” They moved to Plaquemine,
[Louisiana in 1998]. Then they bought another facility. Now they’ve built their own vinyl
production. It has spread the risk, so Dow is continuing to supply very large quantities to their
Texas operations. They’re now autonomous in Louisiana, where Dow is short in ethylene. It’s
been a very nice stair-step situation, and we’re good friends. Andrew hosted an anniversary
party in Tokyo, [Japan] that was very well-received. He’s taken a personal interest. Saitoh
[Yasuhiko Saitoh] was in Midland just a few weeks ago and had a very constructive meeting
with Andrew. Andrew and Kanagawa-san are close and on very good terms, so I think the horse
is back on the track.
79
ULRYCH: How had Ben Branch become a member of the board?
POPOFF: He wasn’t a member of the corporate board in Tokyo, but he was definitely a big
player at Shintech.
ULRYCH: Did he exit and you came on?
POPOFF: No. There was a hiatus between his leaving and my coming on. It wasn’t a very
long hiatus. Maybe a year had lapsed.
ULRYCH: How familiar were you with the chemical industry in Japan when you joined the
Shin-Etsu board [in 2001]?
POPOFF: I had gotten to know the Japanese chemical industry because of their presence in
Europe. Düsseldorf, [Germany] is the epicenter of Japanese trading companies in Europe. I got
to know Mitsubishi, Mitsui, and Sumitomo quite well. I got to know Mitsubishi because of the
Saudi deal. I’d spent some time with Mr. Hijikata from Sumitomo on some environmental
issues. I was reasonably knowledgeable about what they did, their strengths, and their
shortcomings.
So I knew their industry pretty well, but of course you never get to really know it until
you get there and begin to peel the onion back. I was and am certainly no stranger to Japan, but
the more I go there, the more I realize how little I understand Japanese culture. Japanese
industry seems harmonious, but it’s fierce in many respects underneath the surface, though it
will look placid to the untrained observer.
ULRYCH: How do you compare Shin-Etsu’s environmental standards with that of Dow’s?
This is going off in left field a little bit.
POPOFF: Their intentions are rock solid. Their adherence to best practices is undeniable.
They’ve had some regulatory glitches, like every chemical company, and they’ve recovered
handsomely from all of those. Along with Shin-Etsu, Shintech is working very hard to be in the
gold standard category.
Sometimes environmental programs are a leap of faith. There is not an immediate payback.
For instance, Shintech has been reluctant to join trade associations for two reasons: they don’t
80
spend money unwisely and they don’t have the people to attend the meetings. I still don’t think
they’re a member of the American Chemistry Council. They are players in the Vinyl Institute,
but only because the vinyl chloride industry was up to its hips in problems and it had to come
together to preserve each other
ULRYCH: After you retired, you stayed in Midland. How do you perceive the relationship
between the town and Dow?
POPOFF: I think it’s good. Certainly this town is as dependent on Dow as Dow is dependent
on this town. We work together. You’ll see occasionally somebody saying that Dow is not
paying enough taxes or they’re paying too many taxes, but that gets resolved. The employees
are members of the community. They attend the schools here. We’re integrated; the
community and Dow are joined at the hip. I think every Dow CEO should work to be a player
in that relationship, whether it’s becoming involved on the foundation boards, United Way, or in
a whole host of other initiatives that help the well-being of the city, which helps the well-being
of the company and vice versa.
There’s a good relationship. Yes, there was a rough patch when the dividend was cut [in
2009] and everybody was asking, “What’s going on? Dow is laying people off.” Those
situations come up. They’ve come up before. I’m sure there was brouhaha the year before I
joined the company when they had that massive layoff.
ULRYCH: Right before you retired you said you planned to spend your retirement skiing and
sailing. Have you done that?
POPOFF: Yes. I skied until two years ago. I still have my skis, and I morphed from sailboats
to powerboats. I don’t even have one of those anymore. I have canoes and a bunch of kayaks
up north. I sold my boat last year. It was a very nice Chris-Craft. I went from sailing to
powerboats when I realized that the boats kept getting bigger and Jean and I kept getting older.
Jean is a very good sailor. Our last boat was a forty-five-footer. Two people north of
seventy on a rough day on Lake Michigan gets to be a workout. [laughter] I said, “The next
thing is to sell the sailboat and get a powerboat.” I loved it. I had big twin diesels, a lot of
navigation gear, and goodies for going fast. I said to Jean, “How do you like it?” She said,
“Noisy and boring.” [laughter] Sailing and powerboating are totally different. One is about the
trip; the other is about the destination.
ULRYCH: I guess you got started on skiing when you were in Switzerland?
81
POPOFF: Yes, I did. I got started skiing because I traveled a lot. I couldn’t find it in my heart
to say, “Hi family, I'm home and off to the links for a round of golf, or off to the tennis center to
play tennis with the boys.” We decided to do things we could do as a family. Boating and
skiing were things you could do together.
ULRYCH: I know one company in Japan where you have to be a golfer.
POPOFF: It’s sin qua non some places. Kanagawa on the subject of golf is priceless. He said,
“I tried it. I didn’t like it. I gave it up.”
ULRYCH: You are a champion of educational reform. What are some of the major problems
in education that you see in the United States?
POPOFF: That could keep us here for awhile. I think the university system is still the venue
that people from all around the world aspire to attend. K through 12 [kindergarten through
twelfth grade] is so fragmented; there’s the good, the bad, and the ugly. A lot of kids are being
left out. I principally focused on K through 12 with an emphasis on math and science because
those are the enabling disciplines. Reading and writing are equally important, but reading and
writing skills are embedded in all of your other coursework. Science and mathematics are a
choice that all too many kids are not making. I pushed as hard as I could, including, as I said
earlier, talking minorities and females into chemical engineering. I think it has paid off. We’ve
got more women and minorities in the physical sciences.
We had a program where we brought kids in from Renaissance High School in Detroit to
Midland. They had taken a course in chemistry, but they really had no idea who chemists were
and what they did. We said, “Let’s bring them up here. We’ll expose them to the labs, to
production, and to the whole list of what constitutes being a chemist and pursuing a career in
chemistry.” We always had a picnic. It was a lot of fun every summer. One time this very
bright youngster came to me and said, “Mr. Popoff, I learned a lot this summer.” I was
expecting to hear, “I worked in the analytical lab, and I learned this or that or the other. I
worked in the phenol plant, and I learned this or that.” I said, “Well, what did you learn?” He
said, “You know what? You don’t have to deal drugs to make money.”
I said, “Why would you deal drugs?” He says, “Mr. Popoff, the brothers don’t want
some not-so-bright young man to be their drug dealer. They want somebody who can count and
calculate. Believe me, you are solicited. It’s a lot of money.” He said, “I’ve learned, if nothing
else, that I don’t have to do that. There is a job out there if I have an interest in science or
math.” That’s not something you forget easily.
The education situation is a never-ending task. Pick up the Wall Street Journal. In this
morning’s edition you’ll see we’re behind. Internationally we’re better in the fourth grade.
82
We’re not as good in the eighth grade. What’s lacking? Math and science are lacking, and
we’ve got a lot of work to do. It’s fashionable in some areas to dumb down, to not be an
overachiever. Dumbing down is the way to preserve your rapport with some of your peers.
What bothers me is sometimes the smartest kids are the ones who go wrong the earliest, and yet
they’re the opinion leaders.
ULRYCH: Let me ask this final question. If a young person told you he or she was thinking
about majoring in chemistry, what would you say?
POPOFF: Go for it. If you’re interested and you like what can be done through chemistry, go
for it. You will open a door not only to chemistry, but to so many other careers. There are
many avenues chemistry allows you to take: biotechnology, bioengineering, pharmaceuticals,
classic chemistry, to mention a few. There is a wide variety of areas in which chemistry is an
enabling science or an enabling discipline. If you have an interest and you pursue it, it will
serve you well.
[END OF AUDIO, FILE 4]
[END OF INTERVIEW]
83
INDEX
Breuel, Birgit, 57, 58
British Petroleum [BP], 19, 45
Brown University, 5, 10
Brush Beryllium Company, 15
Bulgaria, 2-4, 8, 22, 55, 56
Bulgarian language, 1, 7, 9
Buna Sow Leuna Olefinverbund GmbH
[BSL], 57-60
Butler, Andrew, 25, 35, 36
#
1973 oil crisis, 32, 38
1979 oil crisis, 31, 32, 38
A
Algeria, 50
Al-Zamil, Abdulaziz, 46
American Chemistry Council, 61, 81
American Express Company, 75, 76
Ameritech Corporation, 77
amines, 23
Anchor Hocking Glass Corporation, 16
Anschutz, Philip, 77
antifreeze, 18, 19
AT&T Inc., 76, 77
C
Camp Custer, Michigan, 2
Cannon, Cavendish W., 2-4
Carbone, Anthony J., 72
Carrier Corporation, 77
caustic soda, 16
Ceauşescu, Nicolae, 57
cell effluent, 16
Central Solvents & Chemicals Company, 18
Chemical Bank and Trust Company, 66
Chemical Heritage Foundation, 58
Chemical Manufacturers Association, 61
Chicago, Illinois, 4, 17, 77
China, 32, 63
chlorine, 16, 21
Ciba-Geigy Corporation, 24, 52
Citigroup Inc., 73
Cleveland, Ohio, 15-19, 25
Coca-Cola Company, 75
Colungia, Carlos, 14
corporate governance, 71
Croatia, 2, 47, 49
Cyril and Methodious, 2
B
Balkan Wars, 2, 3
Ballman, Donald K., 15
Barnes, Earle B., 26, 28-30, 32, 46
Basel, Switzerland, 24, 52
BASF SE, 23, 39, 58, 73
Bayer AG, 23, 39, 58
Bayh, Evan, 66
Becnel, Thomas B., 16
Belgrade, Serbia, 47, 48
benzene, 21, 40, 50
Berlin Wall, 57
Berlin, Germany, 59
Beutel, Albert P. "Dutch", 29
Bloomington, Indiana, 10, 66
Bohemian Club, 76
Bonn, Germany, 59
Boots the Chemist, 19
Bosnia, 49
Bosscher, Harold, 35
Boyd, Clyde H., 29-31, 34, 35, 51
brake fluid, 18, 19
Branch, C. Benson "Ben", 22, 24, 27, 30,
38, 44, 46, 49, 52-55, 78, 80
D
Davis, Willie D., 59
Dayton, Ohio, 76
Denver, Colorado, 77
Detroit, Michigan, 82
Deutsch, Elmar, 58
Dimitrov, Georgi, 8
84
Doan, Herbert D. "Ted", 22, 53, 54
Donalds, John, 34
Doscher, Charles, 22, 29, 30, 35
dot-com bubble, 66, 67
Dow Chemical Canada, 22, 28, 29, 35, 43,
47, 57
Dow Chemical Company, 3, 8, 12-60, 64,
65, 67-74, 77-81
acquisition of Union Carbide Company,
68, 69
acquisition of Rohm and Haas Company,
73, 74
agricultural chemicals department, 13,
24-29, 34, 74
"Axe Wednesday", 12
Cleveland, Ohio location, 15, 16, 18, 19
controlled conflict at, 24, 30, 33, 37
family atomosphere of, 26
globalization of, 51, 52
inorganic chemicals department, 17
interviewing for a job at, 12, 13
matrix organization of, 52
metals department, 19
organic chemicals department, 26-29, 34,
38
Texas Division, 16, 26, 28, 29, 35, 37, 45,
47, 71
training program at, 13-15
transportation chemicals department, 1719
urethane laboratory at, 13, 14
Dow Chemical Europe,19-24, 26, 28-32, 34,
35, 36-52
activity in Africa, 42
activity in Bulgaria, 8, 22
activity in France, 23, 37, 39
activity in Germany, 21, 23, 37, 40, 57,
60
activity in Greece, 21
activity in Italy, 21, 23, 30, 37, 42, 50
activity in the Middle East, 42, 44-47, 4951
activity in the Netherlands, 21, 47, 50
activity in Poland, 56, 57
activity in Scandinavia, 37, 43
activity in the Soviet Union, 31, 40, 42,
43, 57
activity in Spain, 21, 50, 51
activity in Switzerland, 8, 22, 24, 37, 40
activity in the United Kingdom, 21, 23,
37
activity in Yugoslavia, 45, 47, 48, 49
cowboy image of, 23, 37, 38
development of manufacturing operations
at, 20, 21, 23, 37
development of marketing at, 36-39
Dow Chemical International, 8
Dow Chemical Latin America, 20, 22, 29,
43
Dow Chemical Pacific, 20, 22, 43, 71
Dow Chemical U.S.A., 22, 30-32, 38-41
Dow Jones Industrial Average, 68
Dowgard, 18
Downey, Joseph L., 35, 36
Dubček, Alexander, 57
Dubrovnik, Croatia, 47
Düsseldorf, Germany, 80
E
E.I. du Pont de Nemours and Company
[DuPont], 15, 23
Earth Summit, 61, 62
education reform, 82
Eli Lilly and Company, 66
Ellis Island, 2, 3
Emergency Quota Act, 3
Engelmeyer, Herbert, 28
environmental full cost accounting, 63, 64
Epsom salt, 17
ethanol, 12
ethyl benzene, 20, 21
ethylene, 21, 40
ethylene dichloride, 78
ethylene glycol [EG], 18, 19
European Union, 31, 41
Exley, Charles E., Jr., 76
Exxon Corporation, 19, 24, 45
85
Hine, Maynard K., 10
Hitchev, Roman, 56
Hoechst AG, 23, 39, 58
Horgen, Switzerland, 31, 37
Houston, Texas, 67
Hungary, 57
Huron, Ohio, 25
F
Falla, Enrique, 35, 36
Farha, Alfred S., 45
ferric chloride, 17
Fischer, A. Charles, 27
flexible foam polyurethane, 13
Flint, Michigan, 13, 56
Fonda, Jane, 47
Ford Motor Company, 18, 19, 66
Ford, Gerald, 75
Foreign Corrupt Practices Act of 1977, 42
France, 5, 23, 37, 39
Freon, 14
I
Iacocca, Lee A., 18
IG Farben, 58, 68
Imperial Chemical Industries [ICI], 23, 25
Indiana University [IU], 1, 5, 7, 10-12, 15,
31, 32, 48, 55, 66, 67
chemistry education at, 6, 7, 10-12
dentistry at, 10
earning MBA from, 6, 7, 10-12
history education at, 7
Kelley School of Business, 66
language studies at, 1, 7, 11
Russian and Russian and East European
Institute, 1, 7
teaching at, 31, 66, 67
Indiana University Foundation, 11
Indianapolis, Indiana, 5, 10, 12, 27
Inland Chemicals, 18
International Chamber of Commerce, 55
Iranian Revolution, 31, 32
Italy, 21, 23, 30, 37, 42, 50
G
General Electric Company, 27
General Motors Company, 19
Genoa, Italy, 2, 3
Germany, 9, 21, 23, 37, 40, 57-60
unification of, 59
Gerstacker, Carl A., 22, 30, 53
glycerin, 25
glycol, 22, 23, 27
golf, 82
Golubev, Yury, 57
Granite City, Illinois, 5
Gray, Harry, 77
Great Atlantic & Pacific Tea Company
[A&P], 11, 12
Great Depression, 2, 17
Greece, 3, 5, 21
Green Bay Packers, 59
J
Japan, 32, 78, 80
Jordan, Vernon, 75, 76
Jubail, Saudi Arabia, 44
H
Hammer, Armand, 43
Henkel AG & Co., 61
Henry, Hunter, 34, 71
Henske, John M., 28
Herbert H. and Grace A. Dow Foundation,
66
Hewlett-Packard Company, 76
Hijikata, Takeshi, 61, 80
K
Kanagawa, Chihiro, 55, 78, 79, 82
Keil, Robert M., 33
Kennedy, Robert D., 63
Kissinger, Henry A., 75, 76
Kohl, Helmut, 59
Kossoroff, Nicolina, 7
86
Kossoroff, Steve, 7
Kuwait, 49, 73
Montedison S.p.A., 23
Mori, Shunzo, 79
Moscow, Russia, 2, 43, 57
L
N
Leathers, Joel Monroe "Levi", 26, 28-30,
35, 46
Leipzig Trade Fair, 59
Leipzig, Germany, 60
Lenin, Vladimir I., 43
Lexan, 27
Libbey-Owens-Ford Company, 16
Liveris, Andrew N., 34, 72-74, 79
London, England, 34
Lufthansa German Airlines, 58
Lundeen, Robert W., 20, 42, 51
Lyon, Herbert H., 53
Nacchio, Joseph P., 77
Naegale, Robert E., 25, 26, 28, 29, 35, 52,
78
naphtha, 40, 45, 47, 50
Naples, Italy, 24
Naroden glas, 5
NCR Corporation, 76, 77
New York, New York, 2, 4
Newark, Ohio, 15
Norbury, Jim, 21
Norel, 27
M
O
Macedonia, 5, 56
magnesium, 19
magnesium oxide, 17
magnesium sulfate, 17
Makedonski novost, 5
Manufacturers Hanover Trust, 47
Manufacturing Chemists’ Association, 61
McCormick, Richard D., 77
McKennon, Keith R., 35
McKesson & Robbins, Inc., 18
Mercedes-Benz, 19
Merszei, Zoltan, 22, 24, 28-30, 33-35, 39,
43-46, 49, 52
methylmorpholine, 14
Midland, Michigan, 1, 13, 15, 17, 18-20,
25-29, 31, 33, 35, 36, 46, 49, 52, 54, 78,
79, 81, 82
Milorganite, 17
Milošević, Slobodan, 47
Milwaukee, Wisconsin, 17
Mitsubishi Chemical Corporation, 46, 50,
80
Mitsui Chemicals, 80
Mohlman, Harry, 78
Monsanto Company, 15
Occidental Petroleum Corporation, 43
Odagiri, Shintaro, 78
Oinas, Felix J., 1
Olin Corporation, 28
Oreffice, Paul F., 28-30, 32-35, 46, 47, 49,
53, 54, 75, 78
Otis Elevator Company, 77
Owens Corning Corporation, 15, 16
Owens-Illinois, Inc., 16
P
Pahlavi, Mohammad Reza, 31, 32
Paris, France, 20, 39
Parker, Michael D., 36, 53, 71, 72
Peacock, Fred L., 13
peanut butter, 11, 12
Pershing, John J., 2
phenol, 15, 27
phenol formaldehyde, 15
phenoxy herbicides, 25, 27
Pittsburgh, Pennsylvania, 15
Plaquemine, Louisiana, 79
Poland, 56, 57
Poling, Harold Arthur "Red", 66
87
polyethylene glycol, 13
polystyrene, 8, 20-22, 47
polyvinyl chloride [PVC], 47, 78
Popoff Cleaners, 2, 4, 9-11
Popoff Garlington, Joan, 2, 4, 7, 10
Popoff, Eftim, 2-4, 7, 9
Popoff, George, 4, 9
Popoff, Jean Urse, 7, 16, 17, 20, 27, 54, 60,
76, 81
Popoff, Stoyanka Kossorova, 2, 4, 7, 9
Popoff, Tim Henry, 9
Port Saint Lucie, Florida, 27
Prague Spring, 57
Pratt & Whitney, 77
propylene glycol, 23, 25
propylene oxide, 25
Pruitt, Malcolm E., 26, 28-30, 46
pyridine, 13
S
sailing, 81
Saitoh, Yasuhiko, 79
Sandison Grammar School, 5
Saran Wrap, 18
Saudi Basic Industries Corporation
[SABIC], 44-46, 49-51
Scandinavia, 37, 43
Schmidheiny, Stephan, 62
Schmidt, Helmut, 59
Schornstein, Dave W., 26, 28, 29, 52
Serbia, 2, 3, 5
Shin-Etsu Chemical Co., Ltd., 55, 78-81
Shintech, Inc., 55, 78-81
Sigma Chi, 5
Sikorsky Aircraft Corporation, 77
skiing, 72, 81, 82
Skinner, Samuel K., 66
Slovenia, 47, 49
soccer, 54, 55
soda ash, 16
Sofia, Bulgaria, 2, 8, 9
Sosa, Enrique, 35, 36
Soviet Union, 8, 31, 40, 42, 43, 57
collapse of, 57
Spain, 21, 50, 52
St. Charles Parish, Louisiana, 79
Stade, Germany, 21
stannous octoate, 14
Stavropoulos, William S., 33, 35, 36, 65,
69, 71, 72
Stroebel, Paul, 35, 39, 44
Strong, Maurice F., 62
styrene, 20
Styrofoam, 43
Sudetenland, 4
Sumitomo Chemical Co., Ltd., 61, 80
sustainable development, 62
Svoboda, Ludvík, 57
Q
Qwest Communications International, Inc.,
77
R
Regional Bell Operating Companies [Baby
Bells], 77
Reilly Tar and Chemical Corporation, 12,
13
Reilly, Thomas, Jr., 13
Reinhard, J. Pedro, 20, 36, 58, 71, 72
Renaissance High School, 82
Republic of Serbian Krajina, 49
Responsible Care, 61, 62
Rhône-Poulenc, 23
Rio de Janeiro, Brazil, 61, 62
Robinson, James D., III, 75
Robintech, Inc., 78
Rohm and Haas Company, 73, 74
Romania, 3, 57
Rooke, David L., 32, 34, 46, 49, 51
Royal Dutch Shell, 45
Shell Chemicals, 78
Russian language, 1, 7, 9
T
Taher, Abdullhady, 46
Tarzy, Ursula, 56, 57
88
Taylor, Harry, 47, 48
Temple, Joseph G., Jr., 33
Terneuzen, the Netherlands, 21, 47, 50
Terre Haute, Indiana, 2, 4, 5, 7, 9, 25
Texas A&M University, 27
Tito, Josip Broz, 47, 48, 57
Tobias, Randall L., 66
Tokyo, Japan, 79, 80
Toledo, Ohio, 15, 16
toluene diisocyanate, 13
Tordon, 25
Toronto, Canada, 57
Total S.A., 19
Treaty of Berlin, 3
Treaty of Rome, 41
Treuhandanstalt, 57
Trieste, Italy, 9
Tuđman, Franjo, 47
Turkey, 3
V
VERSENE RJA, 15
Vienna, Austria, 56
Vietnam War, 25
vinyl, 21
vinyl chloride, 78
Vinyl Institute, 81
W
Wacker Chemie AG, 26
Warsaw, Poland, 56, 57
Washington D.C., 25, 56
Weatherset, 18
Weaver, Buck, 6
Welch, Jack, 27, 28, 38
Wiley High School, 5, 6
Williams Companies, Inc., 77
Wixom, Michigan, 18
World University Games, 8
World War I, 3, 6, 68
World War II, 4, 31, 68
U
Union Carbide Corporation, 23, 63, 68, 69
Union Pacific Railroad, 77
United Kingdom [UK], 19, 21, 23
United Nations Conference on Environment
and Development, 61, 62
United Technologies Corporation, 77, 78
United Way of Midland County, 81
University of Southern California, 46
urethane, 13, 14
US West, Inc., 77
US-Bulgaria Trade and Economic Council,
55
USS Adams, 3
Y
Yamani, Ahmed Zaki, 46
Yugoslavia, 2, 5, 45, 47-49
Z
Zagreb, Croatia, 47-49
Zhivkov, Todor, 8, 9, 55
Zurich, Switzerland, 8, 22, 31, 40, 54, 56
89