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Digital transformation of the chemical industry

Time to bloom

The chemical industry is subject to a different set of rules. The chemical industry must recognize that it too faces challenges with digitalization.

Thomas Hillek

Head of Life Sciences and Chemicals

KPMG in Germany


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The study 'Time to bloom - Digital transformation of the chemical industry' demonstrates that competitiveness requires a distinct digitalization strategy. New technologies enable process optimization and efficiency advantages.

The chemical industry is in many respects subject to a different set of rules compared to most other sectors: the high capital intensity, the pronounced dependency on raw materials and processes are bound to the laws of chemicals. However, the chemical industry has one thing in common with other industries: the high level of competition within the sector. Fully automated processes creating efficiency advantages - especially in basic chemistry - are already indispensable. The sector started recognizing that the effects of digitization and the entailed transformation will be much more comprehensive than initially assumed.

Chemical companies need proactive approach to digital transformation

Between April and May 2016, KPMG interviewed a total of 75 CEOs, owners, managing directors and department heads from the German chemical industry about their assessment of the state of digital transformation in their company. The answers show that the awareness of digital transformation is already pronounced in many cases. But the survey also showed that 60 percent of chemical companies do not provide enough resources and skills to implement digital transformation.

New core competencies are crucial factors for success

Competitive advantage cannot be solely secured through product and production know-how. Companies need advanced knowledge about the application of their products from their customers' perspective and about disruptive technological developments. Detailed knowledge about the customer will turn into a core competency, the use of data and analytics is therefore mandatory. The recent KPMG study 'Time to bloom - Digital transformation of the chemical industry' provides answers on how to approach digitalization and provides examples of unique and innovative applications.

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