| CHEMICAL INDUSTRY JOURNAL |
| industry 4.0 |
A warning to the chemical industry: harness the power of digital tech or be left behind For years, chemical manufacturers and distributors enjoyed a relatively stable industry. However, the last two years have forced chemical companies into a choice: use digital technologies to drive growth or be left with an antiquated, easily disrupted sales process. Yoav Kutner, CEO, Oro Inc., explains why digital B2B commerce is proving to be a significant growth opportunity for the chemical industry and why it will likely gain even more traction in 2022. After being hit hard by supply chain disruptions and a severe drop in end-market demand over the course of the last year, more than 90% of executives in the chemicals industry expect1 digitalisation to result in evolutionary, revolutionary, or disruptive change. The German Chemical Industry Association (VCI) stated that “the industry is gradually changing from a supplier of materials to a provider of solutions and services”, and an EY survey shows that digitalisation in chemicals is starting to accelerate. While the chemical industry has been on the forefront of driving materials innovation, notoriously it has been slower than other industries to move its sales processes online. However, leaders in the chemical industry are now beginning to push the button on digitalisation of business processes. In the boardroom, digital transformation is now viewed as more than a means to improve efficiency or customer experience – it’s the catalyst for innovation and value creation. Today, a new, more competitive environment is taking shape. The industry is highly diverse in size, geographic reach, business model and customer type; while evolving technology, business practices and customer expectations are quickly raising the bar for B2B practices. Chemical enterprises are feeling pressure from greater competition, rising commodity prices, changing regulatory requirements and most importantly the push for sustainability. These trends are driving the greater adoption of digital strategies and will continue to be a key investment driver in the years ahead. According to Deloitte2, highperforming chemical companies that derive the most value out of innovation typically utilise digital technologies to create a better customer experience.
“Today, a new, more competitive environment is taking shape. The industry is highly diverse in size, geographic reach, business model and customer type; while evolving technology, business practices and customer expectations are quickly raising the bar for B2B practices.”
Digital transformation is disrupting B2B commerce in the chemicals industry, bringing in efficiencies through better price transparency, reliability of the supply chain, knowledge of the underlying chemistry and regulatory guidelines for targeting end applications. Companies and platforms must be part of these ecosystems if they are to be even remotely relevant across the chemical industry value chain.
AZELIS One organisation that has embraced digital technologies is Azelis - a specialty chemical and food ingredients distributor operating in 56 countries and serving more than 45,000 business customers, with annual sales of £1.95 billion. Its customer-oriented digital strategy focuses on growing relationships within its ecosystem and optimising complex supply chains. This allows the company to better understand various market trends, keeping the product portfolio and solution focus customer-centric. Heli Kilpala, Group Strategy and Digitalisation Director at Azelis, says: “We have seen a twofold efficiency gain with digital tools, both for employees and customers.” Digital tools such as ERP, CRM, MDM, PIM and eCommerce have enabled data centralisation. Centralising information around data governance and processes has eliminated many duplicated efforts. The result is added freedom from routine tasks, more time for value-added activities, better focus on customers and the agility to quickly react to trends. A digital-first approach meant that Azelis was wellequipped to pick up market activity, react to new customer needs, and plan production accordingly. Azelis also took the opportunity to accelerate the deployment of digital platforms such as its e-Lab, a virtual collaboration center to optimise formulations, and a customer portal with both eCommerce capabilities, technical and informational insights.
CUSTOMER PORTAL Traditionally, chemical sales are an in-person activity. Azelis realised that moving some aspects online could improve the journey and experience for suppliers and customers. The process, however, wasn’t easy. Regulatory and compliance requirements vary between locations and chemical products. Chemical customers must do extensive research and collect documentation about their products, so the discovery process can be long. Its new portal – developed with implementation partner Smile - is
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