As the chemical industry depends on various stakeholders and is an asset intensive industry, the challenges faced by the chemical industry are different in nature. In the past few years, due to the emergence of industry 4.0 and changes in IT infrastructure, the management of chemical industry is facing greater challenges. However, the digital effect also presents opportunities for chemical manufacturing and distribution companies to take advantage of the latest technologies to shorten time to market, optimize processes, and manage the supply chain challenges of the chemical industry with greater efficiency.
In order to maintain a leading position in the digital game, the company must make full use of advanced technology and comprehensive strategy to understand and deal with the problems of the chemical industry. Let’s look at some of the major challenges in the chemical industry:
Data management in the information rich era:
A major challenge of digitalization in chemical industry is data spillover. Senior decision makers are looking for ways to store, analyze and generate insights from rich information flows. Data analysis is still a tricky area for many chemical manufacturer. Legacy systems are still part of the IT infrastructure of many manufacturers. Because different functions work in silos, there are differences in information flow management.
Overcoming the unpredictability of the market:
Market volatility is another major cause of chaos in the chemical industry. Changing commodity prices are putting manufacturers in financial trouble. In addition, the impact of the covid-19 pandemic is reflected in the change of demand pattern – the global demand for sanitary products and sanitary products is great. Such fluctuations are difficult to predict, and most chemical manufacturers’ management is trying to keep up with them.
The need to achieve Agility:
With the rapid development of the world, the manufacturing industry is also trying to catch up. Chemical manufacturers are mainly looking for ways to achieve agility in order to achieve better delivery model, improved change management and measurable productivity. However, companies face different challenges when adopting agile, such as financial constraints, resource and skill management, and resistance from employees.
Although there are many challenges, there are still ways to solve the problems of chemical manufacturers. Let’s take a look at how businesses manage disruption in the chemical industry.
Invest in strengthening it infrastructure:
Chemical manufacturers need to shift to technology as needed, but need a long-term roadmap to justify investment. By investing in high-end tools and systems, chemical manufacturers can ensure that their processes are automated and that data is collated and utilized to generate better insight into business decisions and optimize operations. The use of integrated enterprise resource planning (ERP) tools and embedded Bi tools can change how chemical enterprises meet their operational needs.
BASF, a global leader in chemical manufacturing, uses Microsoft 365 to improve the transparency and efficiency of virtual teams in our global family. This choice is the direct result of the company’s development towards agility.
Supply chain optimization:
Another area where chemical manufacturers can turn the tables and embrace the changes that are happening is to optimize their supply chains. Improving stakeholder communication, promoting real-time inventory monitoring, and avoiding shortages or bottlenecks through proper warehouse management are the steps manufacturers need to take to establish a well functioning supply chain.
Priority Innovation:
The destructive digital environment will make the chemical industry face more challenges. However, organizations can address these challenges by encouraging innovation. Chemical manufacturers should invest in better market research, newer and more efficient production processes, and out of the box customer response management measures. This will improve overall productivity and help companies consolidate their position in volatile markets.
In a word, destruction is a good catalyst to improve the process of chemical companies. On the way to digitalization, enterprises can equip themselves with the latest technology.
