An Interview with SAP: Transforming SAP Solutions into Value for the Chemical Industry
(4 minute read)
Recently I spoke with SAP’s David Dunn about the challenges and opportunities we see for the chemical industry. The content below was first published on the SAP News Center.
Q: When you talk to chemical customers, what are some of the challenges and opportunities you see in the industry?
A: When we look at the chemical industry holistically, given an SAP context, we see a lot of change happening in the ecosystem. In 2020, we saw a lot of mergers and acquisitions put on hold due to market uncertainty, which we feel will result in increased activity in 2021 and 2022.
In the same period, we’ve been shown how a strong or fragile supply chain can affect the chemical industry in terms of supply and order fulfillment. Building stronger supply chains to protect the business has never been more pertinent. It’s important to apply agility in the face of industry or societal disruption to service customers and deliver outcomes.
Lastly, we continue to see organizations focusing on environmental issues, energy sourcing, and volatility. Sustainability and becoming carbon neutral are beginning to take hold, through leveraging technology to begin carbon tracking, for example. Alternative sources of fuel are being investigated further, such as hydrogen, partially driven by the volatility in oil pricing for petrochemical companies looking to take advantage of the upswing in oil pricing.
In summary, we see a lot of change in the chemical space, which presents opportunities for fast movers to resolve challenges and take advantage of chemical industry market dynamics.
Looking to the second half of 2021 and beyond, what do you see as the top priorities for chemical customers?
We see the following four major trends when dealing with our chemical clients:
- Improving customer experience (CX): Customers are requiring digital collaboration for faster product introductions, self-service ordering, and B2B/B2C e-commerce platforms.
- Moving from selling products to selling business outcomes: Clients are looking to serve customers based on insights, using data such as product sales volume and product adoption to create faster new product introduction with assurance.
- Strengthening supply chains: Customers are asking themselves questions such as “How can we be more insightful with demand planning and forecasting using statistical modeling, prediction, and outside factors to adjust and become more agile?” and “How can we use business networks to allow for multi-sourcing if global competition for raw materials or feedstock becomes too rife?”
- Focusing on factories: There is interest in connected machines to synergize pipeline flow, with costing metrics of process or phases, as well as the maintenance and servicing of aging facilities, coupled with governmental compliance and sustainability initiatives.
How has digital enabled these priorities from your perspective?
Digital can mean a lot of things in today’s age, but for us digital in the context of these priorities means the ability to provide solutions to business issues now, in a relatively short amount of time.
SAP has made a great deal of investment in tools for industries to improve customer experience and supply chain via cloud deployment solutions. The days of infrastructure, lengthy implementations, and design from scratch are gone. Now, chemical and process industries can adopt SAP Commerce and SAP Integrated Business Planning for Supply Chain and deploy these solutions in a matter of weeks, not months.
What have been the key elements of success when working with chemical customers?
When we look at some of our recent chemical success stories, many of them point back to a few major tenets that we reinforce within our client engagements. For example, with a recent specialty chemical SAP S/4HANA implementation, the following aspects helped achieve faster time to value and organizational adoption:
- Executive buy-in and involvement: Having stakeholders that are invested in and championing the project initiative is critical.
- Adopting best practices versus design: In order to move with agility, it is key to ensure the scope is managed appropriately and that the organization challenges why standard best practices cannot be leveraged. If change requests from the business do not increase revenue, decrease costs, or provide competitive advantage, then full stop.
- Recognize change, plan for people to be impacted: Change is difficult, but progress is never made by adhering to the status quo. Equally important when implementing software, the return on investment is achieved much faster if users are engaged and leveraging the system. In short, plan for change, plan for impact, and ensure users understand how their job responsibilities will change moving forward.
When we talk to customers, big or small, change management is a key pillar of digital transformation. How are companies embracing these changes and setting up their teams for success?
Organizational change management is a large topic with any software implementation to ensure value is realized from the implementation. Given the remote nature of working today, we are finding it even more essential to plan for additional avenues to ensure end users accept, adopt, and understand change. We share a few of the best practices we are deploying with our customers in small and large engagements:
- Leveraging collaboration platforms for virtual learning
- Preparing just-in-time course content for team enablement
- Building quick-reference guides that are shared physically and electronically
- Using augmented reality (virtual reality glasses) to visualize processes and collaborate on issues
- Communicating with numerous quick touchpoints on virtual platforms daily and augmenting that with various collaboration tools, like SharePoint, Google Docs, Slack, and Microsoft Teams
- Prescriptively ramping up in-person opportunities for knowledge sharing and other forms of support
What differentiates you in the chemical industry?
At NTT DATA Business Solutions, we focus solely on implementing SAP software products – SAP is in our DNA. Over the years, we have spent a great amount of time working with our customers to understand their business challenges and problems, so we can help them realize solutions, obtain benefits, and meet corporate objectives.
Having these experiences and focusing only on SAP products has allowed us to create global practices, or competency centers, which share in the development of business content (pre-configured best practices) and our own software solutions (software extension solutions to solve common chemical gaps).
Finally, we have scaled our ability to cover nearly all SAP solutions with strategic acquisitions in supply chain, such as My Supply Chain Group, and have long-standing partnerships with niche competencies to fulfill all of your SAP needs through one service integrator.
How can people connect with NTT DATA Business Solutions?
We have a variety of assets available on our Website for chemical companies that are evaluating SAP solutions or current customers planning their business transformations. Please follow us on LinkedIn and visit our channels for more background on how we help businesses thrive and transform in the chemical industry.