For chemistry and materials, "they are changing times" may be the most interesting. As in the third scenario, advances in research and the clinical environment are beginning to suppress the virus. However, the behavior of consumers and workers has undergone tremendous and lasting changes. This has produced losers, but also winners, and the flow of demand has undergone major changes. For example, in this case, an air transportation technology that cleans the cabin air and is equipped with all antibacterial surfaces will flourish.
As one might expect, the impact of each situation on the chemical and materials industry is as different as the industry itself. In fact, the specific "products" of the industrial manufacturing process are liquids and solids, but this is not the social and economic experience of chemical discovery and material innovation-on the contrary, industrial output is experienced through specific application spaces. For example, the list of materials for health care personal protective equipment (PPE), medical equipment, and disinfectants are purely chemical industrial products and are usually part of complex formulations.
Obviously, the duration and depth of the public health crisis will directly affect economic conditions. Although this is true, the long-term impact may also be driven by changes in consumer and worker behavior, which is the y-axis in the scenario. Some early views from the second half of 2020 have pointed to a lasting shift. This can be seen in real-time data, such as visiting websites seeking "virtual work solutions."
In view of these changing trends, chemical companies should pay attention to these new growth opportunities and extract more resources from existing assets and resources. This highlights the importance of the industry's "application-centric" view, where the key may be the "pull" of production materials following the final application.
In order to focus on new growth opportunities and obtain more value from existing resources and assets, executives should pay close attention to the larger trends shaping consumer preferences and the broader market environment. Our goal should not be to predict the future, but to track two key factors-the impact of epidemics on the economy, and changes in consumer preferences and behavior-in this rapidly evolving situation.
Although new infection rates and test results can be used to track the development of the epidemic, a key factor that needs to be paid attention to is the policies implemented to contain the spread of the epidemic and the extent to which these measures have inhibited or delayed the development of various regions. The economy reopened. As the community reopened, traffic increased rapidly, increasing the demand for gasoline. In addition, procurement activities have partially resumed, bringing some relief to the consumer sector. As people begin to return to work, the number of new jobless claims has declined. These developments are gratifying, but further progress is still related to the containment of the virus.
Similarly, executives should not only track fundamental changes in consumer behavior before the pandemic, but also recent changes in response to the pandemic, such as increased demand for personal protective equipment and health and safety products. In addition, consumer preferences will continue to evolve in terms of contactless interactions and new ways of receiving services. Companies that can take the lead in adopting an "application-centric" view in this new field may gain long-term benefits.
In the current market, the company can be well served by continuously developing three key competitiveness:
The epidemic has exposed the fragility of global supply chains, leading many companies to explore new and more "localized" supply chains. The chemical industry has responded very flexibly to these challenges, and they may still be required to do so in the event of future oil supply disruptions. Companies that can quickly reorganize their production lines and smoothly adapt to the pop-up ecosystem may have a competitive advantage.
The second capability is the "variability" of cost (the agility to respond to demand). For example, the ability to rapidly expand production and labor in response to turbulent situations may continue to be tested. Likewise, the need to streamline the business and increase business agility may still be important.
Finally, continuing to advance the digitization of operations and market perception can improve the competitiveness of enterprises. The use of advanced market perception, the application of artificial intelligence and other technologies to decision-making, and the reduction of silos within the company through advanced analysis can shorten the response time to key market changes.
