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Market Views
Chemicals
Market Views

## Highlights

- Future growth mainly from developing markets
- Raw material costs are volatile
- Growing health & environmental concerns
- Chemical plants vulnerable to cyber- attacks
- Global markets to grow 20% in next 20 years
- Asian players will own 2/3 of the market by 2030
- Nearly 60% more EU regulations than in 2008
- Average chemical company spends 8% of sales on investments

## Digital Journey

CUSTOMER EXPERIENCE
  In today’s increasingly competitive landscape, chemical companies of all types will benefit from a better understanding of the needs, desires and behaviors of their diverse customers. Some companies are even establishing themselves as a brand for end customers.
BUSINESS REINVENTION
  When commoditization erodes profitability, bulk chemical companies focus on building market leadership and tightening core business, while specialty chemicals companies invest in R&D. In a globalized world, where the pace of change is increasing, reducing product innovation time-to-market is critical.
OPERATIONAL EXCELLENCE
  Chemical companies are benefitting from integrating key areas of their business while rationalize their physical assets. Proactive maintenance programs are reducing outages and maximizing the value derived from those assets that remain. Remote asset monitoring is also helping to lower cost.
TRUST AND COMPLIANCE
  Regulatory pressure and consumer expectations are making compliance and transparency a mandatory ‘license-to-operate’ requirement for chemical companies. They’re also driving improvements in a number of areas including health and safety, traceability and carbon footprint.

#### Marcus Muehling

Vice President Global Market Leader Chemicals, Metals & Mining

> Some companies are even establishing themselves as a brand for end customers. Their modern virtual and physical stores offer a rich, personalized shopping experience that engages and excites the consumer around the brand.

Technologies in the Digital Journey
Technology | x | y | x (phone) | y (phone) | Impact | Range | Section | Keys | Description
--- | --- | --- | --- | --- | --- | --- | --- | --- | ---
Augmented reality | 89 | 46 | 89 | 46 | Adolescent | 2018 | Low | experience,excellence | An increasing number of specialty chemical companies will adopt a wide variety of customer-facing technologies to engage customers more deeply, while enhancing customer service. Specialist paint stores have deployed digital walls based on augmented reality technologies. These allow customers to mix their own colors before ordering them.
3D printing | 76 | 27 | 62 | 60 | Adolescent | 2017 | Medium | excellence | With plants located around the world, 3D printing technologies reducing downtime and shipping costs. Bespoke spare parts can be quickly printed out whenever and wherever they’re required.
Advanced data visualization | 57 | 47 | 58 | 55 | Emerging | 2018 | Medium | experience | Plant managers and shop-floor specialists rely on the real-time intelligence provided by streaming analytics to connect the dots between what’s happening on the floor and ever-changing operational, strategic or customer requirements. To accelerate decision-making, 3D visualization technologies help workers interpret the intelligence in next to no time.
Cloud Service Integration | 51 | 30 | 45 | 45 | Adolescent | 2018 | High | excellence | Cloud computing is improving agility across many parts of the business: from idea and product lifecycle management to manufacturing and supply chain management. With more and more systems now provided as a hosted service, Cloud Service Integration reduces time to market for new innovations by connecting cloud-based services. Cloud-based federated identity services simplify the extension of identity and access management across hosted systems, particularly diverse systems brought together by company mergers and acquisitions. In the future trusted information brokers will act as a central verification service to avoid the need for individual registration and authentication of each cloud service.
Distributed analytics | 65 | 38 | 73 | 36 | Adolescent | 2018 | Medium | business | In specialty companies, the drive to understand end effects is long established. The understanding of perception of taste, smell and visual impact, for example, is improved by more data and analytics. Distributed analytics offers companies a great opportunity to derive intelligence on consumer preference from across multiple diverse sources faster and more efficiently.
Edge computing | 68 | 44 | 70 | 60 | Adolescent | 2018 | Medium | excellence | Now that product and manufacturing IT systems no longer need to be located within the plant, remote or temporary plants can be deployed rapidly. Companies are then employing edge computing to quickly ramp up compute, storage and networking services locally whenever they need them – ensuring computationally-intensive smart factory initiatives are scalable.
High performance computing | 72 | 30 | 55 | 64 | Adolescent | 2017 | Medium | experience,excellence | Computational chemistry suggests possible options when developing new materials that require specific performance and properties, safety and toxicity characteristics. Behind the scenes advanced analytics combined with high performance computing rapidly analyzes millions of possibilities.
Industry 4.0 technologies | 66 | 7 | 57 | 15 | Early Adoption | 2017 | Transformational | excellence | On the factory floor, Industry 4.0 technologies (including the Internet of Things) are enabling the creation of smart factories where plant management is smarter and more virtual. They’re not only improving agility, but also helping workers – from senior management to machine operators – to make better decisions. Geo- location technologies and radio frequency identification (RFID) tags, sensors allow machinery to perceive the world around them.
Innovation value webs | 65 | 22 | 43 | 50 | Adolescent | 2017 | High | business | Open innovation allows the chemical industry to gain value from their wider partner ecosystem, including the collaborative joint ventures that are now embracing diverse industries. Innovation value webs with their new social business tools are facilitating open and nonlinear innovation processes amongst this wider ecosystem.
Intelligence amplification | 82 | 51 | 82 | 60 | Adolescent | 2018 | Low | business | Their decision-making has also been greatly enhanced through intelligence amplification, which requires workers to interpret and react to the broader context of intelligence derived through advanced analytics and machine learning. Computer-generated analytics might, for example, highlight an increase in the demand for black and white photographic inks. Only a human would realize if this were a just a temporary rise, for example one connected to an international photography competition.
Internet of Things | 61 | 6 | 50 | 10 | Early Adoption | 2017 | Transformational | experience,excellence | As the number of connected assets and devices rises, so does the number of connected systems and people. The Internet of Things (IoT) providing the real-time connections between processes, applications, machines and people that brings the smart factory to life. Senior management can automatically tap into social media, for example, to understand current customer preferences and behaviors; then communicate these needs to the shop floor where production is aligned just-in-time.
Mobile and social media app | 90 | 20 | 84 | 66 | Early Adoption | 2016 | Low | experience | Chemical companies have moved toward offering end customers a full range of services around their products, such as decorating services or gardening expertise. Mobile and social media apps supporting products sold to the end consumer help companies gather deeper intelligence on individual customers. An app that provides information on different types of weed provides insight on which types of weed killer an individual customer might be looking for when they identify themselves in either a physical or online store.
Pattern-matching technologies | 80 | 31 | 68 | 65 | Early Adoption | 2017 | Medium | experience | Intelligence derived from the vast volumes of data now available allows chemical companies to make informed decisions around what customers want. Pattern-matching technologies help them discover the patterns and trends across their many products and their end e ects that may bring new opportunities to innovate and gain competitive advantage.
Prescriptive analytics | 57 | 21 | 65 | 25 | Adolescent | 2018 | High | excellence | Intelligent systems then employ prescriptive analytics to determine configuration or maintenance requirements, prescribing a course of action that will both ensure optimal production levels and identify failing parts that need to be serviced or replaced long before they threaten to cause downtime. This type of condition-based maintenance helps companies save on labor and service costs, reduce unscheduled downtime and improve operational efficiency.
Robotics | 81 | 19 | 82 | 25 | Early Adoption | 2017 | Medium | excellence | Advanced robotics are boosting productivity and reducing labor cost. A new breed of robots work as assistants in a shared workspace, taking dangerous or precision tasks away from human operators.
Self-adaptive security | 76 | 41 | 77 | 40 | Adolescent | 2018 | Medium | trust | Cybersecurity and the protection of intellectual property around both products and processes is a growing concern. Dynamic access control ensures employees and partners only have access to the information, systems and locations they need to access, but only when they need it.
Sentiment analytics | 94 | 10 | 88 | 30 | Mainstream | 2016 | Low | experience | Specialty chemical companies have moved up the value chain to where they’re now closer to the end customer. Social media and network analytics is helping them understand general customer behaviors, trends and desires. Its sentiment analytics allows them to not only quickly identify new trends, but also respond to any potentially reputation-damaging comments before they cause any harm.
Streaming analytics | 72 | 15 | 65 | 26 | Early Adoption | 2017 | High | experience,excellence | Industrial data analytics include the streaming analytics that are helping companies to optimize production operations and planning along the value chain.
Wearable computing | 78 | 16 | 73 | 24 | Early Adoption | 2017 | High | experience | Across the plant technicians access information hands-free through modern wearables, such as glasses, that have been made safe from the risk of explosions. Augmented reality relays vital information – such as step-by-step instructions on maintenance or configuration requirements – from the cloud to the paperless worker’s line of sight. Embedded cameras relay pictures to the cloud, allowing specialist engineers to offer their expert support from remote locations.

Radar View

BUSINESS IMPACT
FILTERS
Burning
Maturing
Mainstream
Early Adoption
Adolescent
Emerging
Primary area
Secondary area
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for trend
Click on the radar points to see technologies details
Click on the radar points to see technologies details
BUSINESS IMPACT
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Transformational
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Highlights
Key Market Challenges
CUSTOMER
EXPERIENCE
BUSINESS
REINVENTION
OPERATIONAL
EXCELLENCE
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COMPLIANCE
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