This article was originally published in the Autumn 2018 issue of The Record.
Process manufacturing is being transformed as chemical companies drive sustainable business models for today’s fast-moving, environmentally-conscious market. “Large-scale chemical production was a key driver of the first industrial revolution, and chemical firms also led the way in embracing digital processes to develop the efficiencies and operational excellence embodied by Chemistry 4.0,” says Egbert Schröer, worldwide managing director of manufacturing and chemical & agribusiness leader at Microsoft. “Now, we’re seeing the emergence of Chemistry 4.1: a sustainable and tailor-made chemical industry with increased cross-sectoral collaboration and connected value chains.”
To achieve this, Schröer says chemical manufacturers need to act on four key imperatives: predict market trends and shorten cycles of innovation, enable a new level of responsiveness in production, embrace an as-a-service business model, and address material scarcity in a circular economy.
Chemical companies are increasingly turning to dry lab testing, using computer-simulated experiments powered by high-performance computing, to enable faster, more efficient innovation. “By using digital twins that replicate the physical world, chemists can build models and test simulations as they would in a physical testing environment,” says Schröer. “The true advantage of this method is the ability to run experiments in parallel, using machine learning to analyse the results of hundreds of thousands of experiments and determine the probability of success or suggest optimal experiment conditions. As these experiments run, they become increasingly precise, enabling chemical companies to test and optimise new products in months instead of decades. This also supports sustainability goals, as simulation enables faster design for chemicals that degrade easily, reducing waste products.”
By interpreting historical data from multiple sources, machine learning is also empowering companies to predict product demand. “With the addition of artificial intelligence, these analyses incorporate unstructured data from molecular modelling, text and publicly available data sources such as patents to improve prediction accuracy further,” says Schröer. “Using the outputs of these calculations, chemical companies can project market demand and determine which products they need to develop next.”
Achieving customised production at mass-production costs is one of the biggest challenges. “Without integration between business and manufacturing systems, producing one-off variants is prohibitively time-consuming and costly,” says Schröer. “For mass customisation to be a feasible business model, manufacturers need to integrate business and manufacturing systems and embrace the industrial internet of things (IIoT), paving the way for automation. By automatically triggering production line adjustments based on customer orders, for example, chemical companies can produce customised batches of chemicals at a reasonable cost. With this kind of integration, constant information flow between shop floor and business systems ensures that companies are producing exactly what consumers ordered, increasing customer satisfaction and reducing raw material waste.”
An integrated ecosystem also enables the predictive maintenance of production equipment so it’s always ready to roll. “Embedded software and analytics can diagnose and signal the status and performance of equipment, predict possible malfunctions and maintenance needs, and use mixed reality and digital twins to enhance maintenance and service,” says Schröer.
As customers’ environmental awareness increasingly influences their buying choices, as-a-service business models are essential to gaining a competitive edge. “Chemical companies understand that success in the next few years is not only about satisfying product demand, but helping customers use chemicals in a sustainable manner: maintaining ideal inventory levels, ordering only what is needed, and looking for ways to optimise chemical usage,” says Schröer. “This leads to fewer product sales, which will then be supplemented with new, digital-enabled services.”
Bayer, for example, recently introduced a pest management services platform using IoT-enabled traps for 24/7 monitoring and real-time alerts. Data from the traps can also be collected and analysed for trends, enabling pest management companies to place traps more effectively. And Syngenta, which uses its Enogen genetic biotechnology to develop seeds for ethanol plants with traits such as water optimisation, has deployed connected services from Microsoft partner OSIsoft to monitor the growth of Enogen-based seeds on behalf of its customers. Now it can provide recommendations and advice, as well as insights that its customers can use to optimise their own businesses.
As technologies like IoT and blockchain help manufacturers to assure accountability across the digital ecosystem, they are also helping them take the lead in the circular economy. “For circular economic principles to be implemented successfully there must be clear line of sight into how resources are consumed,” says Schröer. “Manufacturers can more easily repurpose waste materials if they have insight into where these materials are located, how they are being used, and what waste products are produced along the way. For example, waste water from a food production company can be used for another purpose where water quality isn’t essential, such as cleaning shipping containers.”
While such practices are common internally, Schröer says the challenge lies in implementing them across entire ecosystems. “By taking data from IoT sensors and adding it to a blockchain, chemical companies can securely and accurately provide insights into resource use and location across their supply chains,” he says. “This creates an impartial system of accountability that ensures resources are optimally used and reused throughout the ecosystem – including the exchange of materials and products across connected supply chains.”
Ultimately, Schröer says, being at the head of the value chain ideally positions chemical companies to address the challenges and demands represented by resource scarcity and environmental concerns. “By embracing future-facing technologies and adopting a leadership role in a global ecosystem of manufacturers, governments and technology partners, these companies can lead the world in establishing more sustainable economic practices.”
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