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The chemical industry is facing increasing pressure

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zhanzhan
The chemical industry is facing increasing pressure

The chemical industry is facing increasing pressure. The prospect is still a challenging environment. Rapid technological changes have enabled companies to produce according to fluctuations in customer demand, leading to greater price fluctuations. Global basic chemical production capacity continues to increase, and the growth of demand relative to gross domestic product (GDP) is expected to slow. This is dramatically changing traditional business economics. As technology disintermediates traditional supply chain networks, the value chain is splitting. The market has evolved from an organization-centric state to a personal-centric state. In this state, the chemical company largely defines what to produce and what to market to customers. In this state, the chemical company delivers customized and Customized products.

In 2017, the IBM Institute for Business Value (IBV) conducted a survey in cooperation with the Oxford School of Economics. Of the 600 chemical and petroleum industry executives who participated in the survey, 300 were from the chemical industry. Most of the executives interviewed told us that in the new economic environment, many digital technologies are critical to their business strategies.

The new environment facing the global chemical industry is best understood in what we call the "Everyone to Everyone" (E2E) economy.

Coordination, based on the business ecosystem, both collaborative and seamless
Situational, that is, the experience of customers and partners is calibrated and related to their specific actions and needs
Symbiosis means that everyone and everything, including customers and companies, are interdependent
Cognitive ability is characterized by data support, self-supporting learning and predictive ability.
The end-to-end encryption economy initially affected end-customer-centric industries such as retail, automotive, and consumer electronics. Now, the end-to-end encryption economy is penetrating into the business-to-business (B2B) industry, including the chemical industry. Digital technologies such as 3D printing, Internet of Things (IoT) and adaptive robotics are changing the way customers interact with chemical companies. The chemical industry needs to digitally transform its companies to keep up with this technological change and the damage it brings.
Technological destruction in the chemical industry has increased significantly. The fourth industrial revolution—sometimes referred to as Industry 4.0—is characterized by increasing digitization, prompting chemical companies to interconnect products, value chains, and business models.

The proliferation of connected devices and IoT technology has already driven major changes by connecting related industries. For example, the rapid development of the Internet of Things in agriculture helps to timely and accurately transmit real-time weather forecast data related to dynamic agricultural processes such as planting, harvesting, and chemical applications.

In another example, OnFarm uses sensors and IoT connections to enable farmers to optimize water, energy, and inputs. Dow Chemical has installed two radio frequency identification (RFID) tags on train cars in North America; steel cylinders are tracked by barcodes; transportation assets are tracked through RFID, cellular GPS or satellite GPS.

This provides Dow with real-time visibility of almost all materials, and incident management software coordinates relevant alerts. New entrants in the field of chemistry are using digital technology to conceive and realize bold new concepts-disintermediating traditional participants. Many companies have successfully broken the established process, and this trend will accelerate.
For example, the American technology company Zymergen uses automation, big data, and software algorithms to manufacture high-value chemicals and new materials. The US-based startup NanoMech uses nanomanufacturing technology to produce new lubricants, specialty chemicals and coatings for customers in the automotive, retail, energy manufacturing, exploration and service, aerospace manufacturing, textile and advanced military applications industries.

Due to the integration of this new digital technology, half of the chemical and petroleum executives participated in the 2016 IBV Global Ecosystem Survey and more than 2000 global business leaders, conducted in cooperation with the Economist Intelligence Unit, said the traditional value chain Be dispersed and replaced.

55% of chemical and petroleum industry executives said that the boundaries between their industry and other industries are blurring. 42% said that competition from unexpected new sources is beginning to affect their business.

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