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Slow Digital Transformation Endangers the Leadership Position of the German Chemical Industry

“The leadership position of German chemical companies is in danger,”1 stated BASF CEO Martin Brudermüller at the Handelsblatt Jahrestagung Chemie in early April. “We need to be much more innovative in Europe." A major element of the innovation Brudermüller refers to falls under “digital transformation”, an area with slow progress in Germany. Every third German Chief Digital Officer (CDO) has no digital strategy defined.2 That is also the case in the chemical industry. According to Ernst & Young’s “DigiChem SurvEY”3, initiatives to digitalize and improve value chain processes/efficiency and administration are ranked as number one in German chemical companies: 63% of the respondents have plans and 29% of respondents have already implemented digital transformation initiatives in administration, 20% in value chain processes and efficiency. The numbers are lower in other segments.

So, digital transformation is a topic in C-Level meetings and first digital initiatives have been started. However, the everyday life of chemical companies is still determined by paper, spreadsheets and manual processes, leading to compliance and quality risks, cumbersome audit preparations, missed registration deadlines, high error rates, high workloads, frustrated employees and low innovation rates. The question is: Why do German chemical companies hesitate to go digital? The complex journey towards Industry 4.0, predictive maintenance and the use of robotics and artificial intelligence takes time. However, there is a first critical step for all of them: successful digitalization.

The First Step: Digitalize the Basics

Begin with the simple things: modernize your systems, minimize the use of spreadsheets and email wherever possible, unify information silos, be prepared for the next audit, bring your products to market faster and become a leading example for dossier quality and completeness.

Many processes in highly regulated industries like the chemical industry are an ideal fit for digital transformation. Modern technology, e.g. for quality management and regulatory affairs, safely connects formerly fragmented and isolated content, processes and data beyond departments and company borders. It accelerates the product journey from R&D to market launch and helps to address questions regarding circular economy and sustainability. Last but not least, it eases the employees’ lives and can also help to attract and keep great talent as well as gather learnings and knowledge for the next generation. Based on Veeva’s past work with chemical companies, we know that the digital transformation journey begins with getting your basics right.

Pursuing Digitalization Towards Digital Transformation

Select industry-leading chemical companies in the German speaking region have successfully begun their digital transformation journey in partnership with Veeva and its cloud-based quality and regulatory management solutions. BASF is one example.

“Veeva will help us address BASF’s regulatory requirements of our crop protection business,” states Rainer Becht-Mattern, Head of IS Business Architecture R&D, Crop Protection at BASF, “Veeva QualityOne will provide a foundation for our digital transformation.”

Looking at our neighbours in Switzerland, DSM manages all submission dossiers across departments and regions with Veeva. The latest versions are always at their fingertips and can be shared with internal as well as external stakeholders.

“The Veeva Vault Platform helped us transform and speed up our regulatory processes”, says Dr. Landry Le Chevanton, Head of RAQM/Operations at DSM. “It streamlines product submissions and establishes a single source of truth across all stakeholders. It provides us with the needed visibility and helps us increase our productivity.”

Digitalization is Key to Staying Competitive

Getting your basics right by content and process digitalization is the first step towards digital transformation, which will lead to unforeseen innovation and further disrupt the global chemical industry. If German chemical companies want to keep their market dominance, there is no path around digital transformation.

Let us know about your most relevant challenges and we will demonstrate what a modern solution for quality management, regulatory affairs and product claims management can look like. Learn more.

 

Sources:
1 https://www.handelsblatt.com/journalismus-live/handelsblatt-tagung-die-vormachtstellung-der-deutschen-chemiekonzerne-ist-in-gefahr/24198280.html?ticket=ST-1973360-p4QBY10k7CbShoDXfklQ-ap4
2 https://www.diva-e.com/de/news/cdo-insights2019/3 https://veranstaltungen.handelsblatt.com/chemie/news/dr-ing-frank-jenner-ueber-die-digitale-transformation-in-der-chemischen-industrie/, https://www.chemanager-online.com/themen/strategie/fachkraeftemangel-bremst-digitalisierung-der-chemie