Chemical manufacturers have been under pressure to adopt advanced technology like AI and the Internet of Things (IoT) to co-innovate, better anticipate demand, and drive safety, efficiency, and agility. SAP is helping drive digital transformation in the chemicals industry.
SAP S/4HANA chemical management software can support businesses to the core. SAP Implementation in the chemical industry lets you incorporate emerging technologies, such as ML, IoT, and RPA. Then, add to it the cloud-enabled business-data platform.
Vinita Rai, Head of Enterprise Cloud, SAP India, tells us more. Excerpts from an interview:
DQ: What is SAP’s support towards the Indian chemical industry, and your contribution to making them a significant vertical globally?
Vinita Rai: The Indian chemical industry is the sixth-largest producer of chemical products globally. The importance of this sector can be gauged by the fact that it generates 5 million jobs, contributes 7% of the nation’s GDP, and supports industrial and agricultural growth in India.
From an SAP perspective, we have the third largest customer base in this segment in India, trailing only the United States and Germany. For over two decades, we have been providing a range of solutions to all segments (bulk or specialty chemicals), and chemical companies of all sizes (large, and mid-size) in India, including enterprise resource planning (ERP), supply chain management, customer relationship management (CRM), product lifecycle management, business analytics, etc.
These solutions are designed to help chemical companies manage their operations and make more informed decisions while enabling them to gain greater visibility into their supply chains, track production and inventory, and identify and respond to market trends.
Our solutions also enable companies to comply with regulations and industry standards, ensuring they remain compliant and competitive in the global market. Through these offerings, we are committed to making the industry become more efficient, profitable, competitive, and a significant sector globally.
DQ: Elaborate on how you are positioning RISE with SAP solution.
Vinita Rai: The chemicals industry is one of the largest industrial sectors in India and has experienced rapid growth in recent years. Fragmented knowledge sharing, the development of technological capabilities and skills, safety concerns, and disruptive supply chains continue to be major sectoral challenges.
Additionally, ongoing macroeconomic uncertainties and geopolitical risks, coupled with sustainability challenges (like reducing GHG emissions) pose a significant challenge for the industry. It’s therefore imperative for this sector to prioritize digital transformation and augment its capabilities for managing market volatility, supply chain disruptions, and demand fluctuations for sustainable and profitable global operations.
In line with this, our RISE With SAP is a comprehensive suite of cloud-based solutions, available to customers looking for business transformation as a service in a single package. It can help companies start or enhance their digital transformation—no matter where they are in their journey.
Designed to help customers digitize and automate their business processes, RISE With SAP can enable chemical companies to build a stable, standard, and intelligent digital core. Furthermore, it can also help organizations to integrate multiple systems, convert raw data into valuable business insights, and develop intelligent applications to rapidly expand their digital core via SAP BTP integration.
Additionally, RISE with SAP solution and its capabilities is highly valued by Indian chemical companies. They enable each firm to develop and implement modern business processes, gain efficiencies, and transform their enterprise applications systems while minimizing business and operational risk and disruption.
We are seeing an increased demand for our cloud solutions, with many renowned Indian enterprises, such as Deepak Nitrite, Gujarat Fluorochemicals, and Chembond Chemicals, adopting RISE with SAP, and becoming intelligent, sustainable enterprises. RISE with SAP solution will empower chemical companies by making it easier for them to start their enterprise application journey to the cloud, while also building a scalable and flexible enterprise application landscape.
RISE with SAP is a flexible solution designed to support your business needs in your industry, in any geography, for any regulatory requirement, with SAP responsible for the holistic service level agreement (SLA), cloud operations, and technical support.
DQ: Are chemical companies able to build a stable, standard, and intelligent digital core in the form of S/4HANA Cloud?
Vinita Rai: Yes, chemical companies can build a stable, standard, and intelligent digital core in the form of S/4HANA Cloud. By using this platform, companies can gain access to the latest innovations and capabilities of SAP, such as analytics, ML, and AI. This can help them to improve business processes, increase efficiency, and reduce costs.
Furthermore, the platform is designed to be secure and compliant with data privacy regulations. Enterprises can also meet supply demands by transitioning to a low-carbon future, in addition to synchronizing tactical and strategic operational and financial strategies.
DQ: How can chemical companies interact with numerous systems, transform data into business value, and easily extend the digital core? Thanks to the integration of SAP BTP?
Vinita Rai: SAP’s chemical customers have multiple systems, besides the ERP, in their landscape. Chemical sector customers are today leveraging the power of SAP’s Analytics and BTP to integrate data across these systems. SAP’s Data Warehouse cloud allows customers to bring data from multiple systems, including Data Historians, MES, and LIMS Systems to analyze and get meaningful insights from their data.
DQ: How is SAP tackling the current geopolitical and environmental challenges by executing sustainable alternates?
Vinita Rai: Sustainability is the single greatest business challenge of our generation. At SAP, we have known that, and have taken action to make real changes, for a long time.
We believe technology is a way to enable and accelerate companies of all sizes and industries to achieve their sustainability and diversity goals by reinventing the way they measure and manage carbon emissions, waste, and inequality across their operations and their value chains. We have this technology and expertise to help customers at every stage of their sustainability journey, and with our broad industry sector expertise and strong partner ecosystem, we have deep insight into industry-specific sustainability challenges and needs.
For instance, for any chemical company trying to become sustainable, having access to data on their emissions is critical to drive changes and make informed business decisions. The good news is that the kind of data needed to improve operational sustainability performance is often available in the SAP systems businesses already use to run their business. If businesses are using SAP S/4HANA, or SAP Ariba, they have a lot of this data already. Building on baseline data transparency and reporting, organizations can optimize and use their data across their operations to create real, strategic change.
SAP’s solution portfolio incorporates sustainability into every aspect. Product footprints are now available in SAP Integrated Business Planning, allowing businesses to track greenhouse gas emissions from their manufacturing facilities. Another example is the combination of the SAP Sustainability Control Tower and SAP SuccessFactors products, which provides users with data on how their company performs in key areas such as diversity and inclusion.
SAP Product Footprint Management, SAP Responsible Design and Production, and SAP Sustainability Control Tower are all embedded cloud-native SAP S/4HANA apps, which are delivered in a modular format, and built on the SAP Business Technology Platform.
Many SAP Customers are also looking to de-risk their supply chains from regional or vendor-specific concentration risks. SAP has been helping customers better visibility of their supply chains and systemic risks that they are faced. Working with this data our customers can create Plus One sourcing strategies that de-risk their supply chains.
SAP’s Business Network Products also provide visibility by integrating vendors and logistic services providers. This helps SAP customers gain improved visibility of their supply chain-associated operational risks.
DQ: How can chemical companies benefit by collaborating and integrating with customer and supplier supply chains to co-innovate and unlock superior value for all?
Vinita Rai: Integrating and collaborating across the customer and supplier supply chains ensure visibility and better alignment of demand and supply. This results in improved revenue realization, as well as an increase in the bottom line. The consequent benefits of a collaborative supply chain are higher customer fulfillment and better customer retention: leading to enhanced brand perception.
By integrating their entire supply chain, chemical companies can increase efficiencies and cost savings. For example, better visibility of customer demand helps an organization optimize its raw material sourcing contracts, thus improving costs. This collaboration and visibility across the supply chain help the organizations in planning their production better as supply disruptions are minimized thereby reducing the inventories and improving the fulfillment rates.
Integration of customer and supplier supply chains can help to speed up the time to market for new products. By working more closely with customers and suppliers, chemical companies can ensure that products are developed and launched more quickly, giving them a competitive edge in the market.
DQ: How can companies develop and implement new business models to transform their enterprise applications systems with minimal disruption?
Vinita Rai: New business models require the enterprise to reinvent existing operating models, better respond to customer demand with agile business processes, ability to measure business outcomes in real-time, and deliver personalized user experiences across the value chain.
As organizations pivot investment towards new business models, a robust people, process, and technology strategy is the core foundation to make this move least disruptive. Technology should be used as a foundation to not only make this transition seamless but also predictable and effective.
Our customers have tasted success by implementing side-by-side innovations to support their business model transformation by:
- Optimizing and making existing processes intelligent and agile so that business model outcomes with new process variants can be continuously assessed.
- Reinvent the operating model with a plug-and-play business network to digitize, connect and scale the ecosystem and be an event-driven enterprise.
- Optimize existing data assets to predict business outcomes in real time and implement new strategies to create differentiated product & customer experiences.
This interview was originally posted on Dataquest (DQ) on April 5, 2023.