In the past, the chemical industry has been slowly investing in technology as a business difference. But times are changing. Experts from PricewaterhouseCoopers said: “The chemical industry may eventually be approaching a tipping point. Driven by accelerated development of technologies, these technologies are shaping customer purchases and needs. Some chemical companies have begun to reconsider their growth strategies. Eventually, from cutting costs and reducing expenses, to a more flexible, coherent, and active business model."
In addition to the advanced technologies that make change possible, what other factors are driving chemical suppliers toward a more growth-oriented attitude? When we look at the new trends in the chemical industry and how chemical companies can get the best profits from digital transformation, there are The five strategic requirements are particularly prominent.
Profit pressure
In recent years, we have discovered chemical companies whose pricing and profits are subject to strict scrutiny. One way to solve this profit pressure is to improve operational efficiency. Through chemical-centric ERP and supporting business systems, effective operations increase the bottom line of the business. They will increase asset utilization, increase production and efficiency, and increase employee productivity.
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Customer expectations
As the demographics of chemical customers or customers are getting younger and younger, their purchase expectations are determined by their easy access to products and services. The new generation of buyers look forward to instant communication, timely response, and personal access to information in real time. Chemical companies can use technology to satisfy customers by accurately providing the information they need.
Supervision
In the chemical industry, compliance with government regulations is a necessary business. These regulatory requirements are constantly changing. The affected areas include facility process safety, safety, chemical product safety and transportation. Chemical companies must comply with OSHA (Occupational Safety and Health Administration) Hazard Communication Standards, SARA Chapter III and GHS reports. Using digital transformation, chemical companies can respond more flexibly to compliance issues and regulatory changes, from the changes required to spread to all forms and channels, helping to ensure that the company still complies with new regulations.
M&A activity
M&A activity in the United States is growing rapidly. As companies see an increase in cash levels and expenditures, mergers and acquisitions remain the main focus of these funds. In addition, this situation is expected to continue. Since financial transparency is a key factor in evaluating potential acquisition targets, the use of a sound and updated ERP system can consolidate the attractiveness of acquisition candidates.
“Whether it’s M&A value and integration, digitalization or de-globalization, the best way to deal with fundamental disruptions is to first determine how they will affect your company, and then develop a strategy to take advantage of these opportunities. These issues are increasingly becoming The front and center of the chemical industry will determine the growth and dynamics of the industry in the next 12 months and beyond. Turning a blind eye to them will only exacerbate the slow-growing environment, and this environment is for too many chemical companies It's too familiar."
Opportunities for business model innovation
Business innovation opportunities in the chemical industry are dramatically changing the way people live, work, and communicate with each other. The chemical industry is making contributions to how ideas and innovations can be transformed into complex products, such as touch screens, drones, rechargeable batteries in portable devices, organic light-emitting diodes in flexible electronics, and so on. At the same time, the industry itself is transforming, seeking opportunities to benefit from digital technology, including achieving operational excellence through digitalization.
Whether it is profit pressures, customer expectations, regulation, mergers and acquisitions activities, or business model innovation, the best way to deal with these growing trends and problems is to clearly identify them (rather than hiding under the rocks). Then, you can fully understand how your company is affected and begin to take advantage of the opportunities provided by digital transformation to solve problems in these areas. In the chemical industry, it is obvious that these issues are increasingly appearing in the minds of business leaders, and will continue to be so in the future.
