Chemicals companies are to significantly increase their investments in digital technologies over the next three years, with cloud computing and big data analytics expected to generate the highest return on investment (ROI), says Accenture.
Accenture’s online Digital Chemical Survey, July-August 2014 surveyed 156 C-level and top management executives in the petrochemicals, agrochemicals, paints and coatings, plastics and fibres, specialty chemicals and basic and intermediate chemicals industries in the US, Germany, France, Austria, Switzerland, China, United Arab Emirates and Saudi Arabia.
According to the study, digital agendas are increasingly driving strategic decision making, with 94% of respondents indicating that these technologies would have a similar revolutionary impact on their business operations as the introduction of the internet in the 1990s.
Although 87% highlighted that companies who do not embrace digital technologies will risk losing their competitive edge, currently only 58% of the respondents have adopted or are in the process of deploying this technology. More than 54% of the respondents projected a significant rise in digital spend and over the next five years and expect to achieve three main benefits. These include improved productivity (25%), redefined product development (24%) and enhanced customer relationships (22%).
Meanwhile, around 44% of those surveyed expect to achieve the best ROI from cloud technology, while 33% predict big data and analytics capabilities will have the most impact.
“We’ve entered the age of a different kind of internet – the industrial internet of things – where sensor-driven technology and intelligent machine applications enable communications between a company’s assets, products and systems that were never possible before,” said David Abood, global managing director of Accenture’s chemicals and natural resources industry group. “But to drive business value, companies need the data and advanced analytics capabilities that allow them to make better, faster and more-informed decisions, while using cloud computing to improve the efficiency of this data and systems management.
According to Abood, the chemicals industry is currently facing significant logistics and supply chain challenges as a result of the shale oil and gas boom, as well as the pressure to reduce carbon emissions.
“Applying a combination of digital technologies can help companies respond to these market shifts by changing the way they operate, becoming a digital enterprise while also improving the safety of their operations, driving efficiency and reducing costs,” said Abood.
While 90% of the respondents indicated that they have increased investments in employees focused on digital technologies over the past three years, Abood predicts that in ten years, around half of a typical chemicals company’s employees will be ‘digital natives’.
“They will be accustomed to convenient and easy digital interactions in their personal lives and will expect the same kind of experience at work,” said Abood. “We are seeing an increase in focus on improving customer experience and adopting a broad range of digitally enabled processes and practices to meet these customer expectations. These changes can give companies a powerful opportunity to differentiate, increase customer satisfaction and compete more effectively.”
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