Digital Transformation In The Chemicals Industry (Digitalist)
Scientists conducting test in laboratory --- Image by © Monty Rakusen/cultura/Corbis

Digital Transformation In The Chemicals Industry (Digitalist)

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Knowde Take:

Nice concise summary of the various challenges facing the modern chemical industry and some of the technologies that can be used to drive value in the face of those headwinds.

The chemicals industry is more than a single industry. It is a group of industries that produce a wide range of products across many unique segments. Base chemicals, paints, beauty products, fragrances, and food flavorings all face pressure due to rapid changes in digital technology, consumer demand, and global competition.

In the past, large producers dominated the market. These large producers valued operational efficiency over flexibility and adaptability. Today, the market is challenged by niche players that strongly focus on consumer demand. These players have prompted incumbents to differentiate themselves by producing smaller batches for individual customer needs and selling services, experiences, and outcomes, while being early adopters of digital technology at the business core.

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The Future Of Sales And Marketing In The Chemical Industry (Digitalist)
30 May 2012, Marbella, Spain --- workers checking water quality --- Image by © Chris Sattlberger/Blend Images/Corbis

The Future Of Sales And Marketing In The Chemical Industry (Digitalist)

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Knowde Take:

This is a great reminder that operational efficiencies can only take a company so far.  Applying technology to Marketing and Sales means producers can reach more customers and reduce cost-to-serve.

The chemical industry is at a crossroads. Faced with market unpredictability, increased regulations, and products that are quickly moving toward commoditization, it is becoming increasingly difficult to maintain reasonable margins. A few companies are finding success by developing breakthrough products, but true revolutionary innovations are hard to uncover.

Instead, most chemical manufacturers have responded by reducing costs with operational efficiencies. One area that is often overlooked, however, is sales and marketing. This department continues to deploy traditional approaches to selling, despite rising expenses. In fact, a recent study from McKinsey indicates that average sales, general, and administrative (SG&A) costs increased by as much as 10% over the last decade.

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Demystifying Digital Marketing And Sales In The Chemical Industry (McKinsey)

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Knowde Take:

This article provides the best possible motivation for industry stalwarts to further develop their digital capabilities: cost savings AND topline growth. And for those willing to act quickly, the potential to displace the competition.

Digital can give chemical companies the power to unlock more than $200 billion of new value by reducing cost to serve, improving pricing, and for fast movers, capturing growth from competitors.

Over the past decade, the chemical industry has enjoyed remarkable success, delivering more shareholder value than its upstream suppliers, downstream customers—and, indeed, the global equity market as a whole.

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Digital Transformation In Chemical Industry Is Here (World Economic Forum, Accenture)

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Knowde Take:

The World Economic Forum and Accenture collaborated on this truly comprehensive paper on the many ways that digital technology will impact, improve and challenge the chemical industry as well as the frequent disconnect between the understanding and acceptance of the benefits of digital vs. the execution of effective digital initiatives.

Digital transformation is emerging as a driver of sweeping change around the world. Connectivity has shown the potential to empower millions of people, while providing businesses with unparalleled opportunities for value creation and capture. The Chemistry and Advanced Materials industry played a leading role in previous industrial revolutions, through its products and innovations, in areas such as pharmaceuticals, plastics and consumer electronics.

Today, the Chemistry and Advanced Materials sector is an important enabler of the Fourth Industrial Revolution. Its contributions allow other sectors to turn ideas and innovations into sophisticated products supporting digitalization. But the industry itself is also being transformed through digitalization. Digitalization helps increase productivity and safety across the industry’s value chain and supports the design of new offerings.

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