SAPPOV: Why Chemical Companies Need The Cloud

At around $3 trillion, the chemicals sector is one of the biggest and most important in the world. And while the largest companies take the lion’s share of this pie, there is a thriving, 

S&OP process for chemicalsfast-moving market for small and mid-sized players in the industry.

These companies typically have the same needs as the big guys – HR, finance, all of the standard line-of-business functions – plus chemistry-specific operations. But to find a competitive edge, they also need to be able to do flexible batch operations and rapidly set up new equipment and processes at a small scale.

Traditional operational models only go so far. To fight for a share and win it, they need every advantage they can get. In short, they need the cloud.

I can think of five compelling reasons why:

  1. Mobile workforce. Whether on the floor at a processing plant, with a client or on the move, empowering employees to sift real time data and make decisions on the fly revolutionizes their potential across the board.
  1. Minimize disruptions.Chemicals companies operate across a huge spread of regulatory environments. These aren’t all compatible and they often change. The right sort of cloud setup means that problems can be anticipated – and stakeholders informed – with time to do something about them.
  1. Scalability. A cloud-hosted solution available at short notice and on a hosted monthly subscription basis does not need the up-front capital back-up that larger players enjoy. If there’s a peak in business in an emerging market, for example, you can meet that need quickly and easily.
  1. Collaboration.In a flexible, fast-moving operation (and indeed many larger ones), not all of the key team members will use the same technologies. With the right technology, collaboration – as well as transparency and accountability – are easily managed.
  1. Differentiation through Innovation.Product life cycles are shrinking, customers get more and more demanding and competition gets tougher in today’s global world. Product innovation, but also rapid business model or process innovation are powerful weapons to survive or thrive in such an environment. Here cloud solutions can help to secure rapid access to latest technology innovations without going through time consuming and costly (re)-implementation projects.

While cloud computing has yet to fully penetrate the chemicals industry, other sectors, such as retail and healthcare, have picked it up enthusiastically. You don’t have to look far to see some intriguing examples of best practice and unprecedented agility. Amazon, for example, in its warehousing, or UPS in its logistics, not to mention much of the technology you use without even thinking on a smart phone.

It’s no great leap to see that the technology is relevant to more than one sector. The real revolution cloud-based solutions promise is not so much what they deliver as it is how they deliver it – with unprecedented speed, simplicity and scalability, plus reduced cost and risk.

To learn more about we can help you with your business challenges please have a look at SAP’s Solution Explorer for the Chemicals Industry: and find out more about our cloud solutions:

What do you think about the issues discussed here? Continue the conversation in the comments below and on Twitter @SAP4Chemicals

Dr. Stefan GuertzgenDr. Stefan Guertzgen works for 6 years as Global Director for Industry Solution Marketing Chemicals at SAP. Prior to this assignment he has worked for 11 years in the chemical Industry (Chemtura) in various positions comprising R&D, Global Business Development, Sales and Business Process Management, and Sales & Operations Planning. In addition, he has 7 years experience in Presales and Management Consulting for the process industry (AspenTech, AT Kearney, and SAP Business Consulting) with focus on business operations.