September 28, 2018 | Chemicals
The chemicals industry is one of the largest and most diversified businesses in the world. The global chemicals industry is witnessing rapid changes in demand and leveraging digitalization to improve its operational efficiency has now become a vital need for the industry. However, the industry has not been as dynamic as other industries such as telecom, media, entertainment and manufacturing in adopting digital technologies. Companies in this industry are aware of the many benefits digitalization can offer in improving their supply chain. Apart from improving the supply chain, digitalization has the potential to offer quick turnaround times, pricing that is in sync with the latest market conditions and a healthier bottom line.
The chemicals industry can be further categorized into basic chemicals, specialty chemicals, agrochemicals and, to some extent, pharmaceuticals. Efficient supply chain ecosystem and logistics are the key ingredients for driving success in these segments. Supply chain management has a significant share in the total cost of ownership of the product and is critical for service-level and top-line outcomes.
Need for Integrated Systems
To achieve efficiency in the supply chain, companies need comprehensive and tightly integrated solutions that can combine demand management, planning and scheduling. This can easily integrate into manufacturing execution systems and enterprise resource planning systems. This kind of integration is critical for manufacturers to manage their assets effectively and truly optimize their production processes.
Unfortunately, a complicated blend of solutions is not well-suited for tracking assets all over the enterprise on a wide scale. When information is stored in different pockets of systems, it reduces visibility and creates the ground for silos of information to develop. Thus, schedulers, planners and leadership management must look for proxy information directly or indirectly, which affects the supply chain. Integrated systems and business processes are necessary for all divisions to enable smoother and more streamlined operations.
Supply Chain Best Practices
The chemicals industry is evolving and the simplified solutions now available are proving easier to use and support. The huge volume of unstructured data that is generated by the industry can be analyzed using advanced analytics to extract management-relevant information. This data can be used to optimize the plant's utilization rate and to make better-informed decisions across the range of a chemicals company’s business processes.
Here we list some of the best practices:
The chemicals industry today is undergoing a dynamic growth phase and the projections for future development seem optimistic. However, to fulfill the industry’s potential demands, clear visibility and highly integrated supply chain management software are the key ingredients for success. The use of process software optimization tools for monitoring and measuring performances across the entire supply chain is becoming the need of the hour.
Here are two examples of how digitalization has helped companies:
For many companies, digitalization can substantially increase profit margins: