VIDEO: Meagre R&D dents future chemicals growth – Hodges

30 January 2012 13:27  [Source: ICIS news]

By Andy Brice

LONDON (ICIS)--The chemical industry must act now to refocus on research and development (R&D) and populate its product pipelines, a consultant said on Monday.

A legacy of cutbacks in R&D departments and long lead times mean the industry faces a paucity of innovative products at a time when growth is faltering, said Paul Hodges, chairman of UK-based consultancy International eChem.

Hodges’ call to action is detailed in chapter eight of his New Normal eBook* and comes as the global economy continues to flounder.

Despite a sustained period of success and wealth, spending on R&D across all sectors appears to have declined and this is having a detrimental effect on the global economy and health of the chemical industry.

In a video interview, Hodges said: “It’s very worrying and reveals an urgent need to do something. Shell CEO Peter Voser said it takes about 30 years for a new technology to get to 1% of the market.

"We have been cutting back. At this point where growth is stumbling, we haven’t got a pipeline of new products and services coming through. This really is now a very urgent issue… there’s no time to waste."

He added: “We’ve gone down a blind alley. We’ve focused on development, taking existing products and adding a bit more value to them, which is fine as part of a portfolio but where are all the new products and new services?”

Hodges said that companies must start to concentrate on the needs of both the western baby boomers and those now emerging from poverty.

“We’ve got this wholly-new generation, people of 55 years plus in the west - the ageing babyboomers - and almost nothing has been developed for their needs,” he said.

“Equally, all the people who are emerging from poverty in the emerging economies, almost nothing has been developed for them. There’s a gap in the market and a fantastic opportunity but for goodness sake, let’s get on with it.

“There’s no shortage of opportunities, there just seems to be a shortage of recognition that these ideas are out there,” added Hodges.

*Chapter eight of Boom, Gloom and the New Normal – How Western Baby Boomers are Changing Global Chemical Demand Patterns, Again is now available free to download at It is co-authored by Paul Hodges, chairman of International eChem, who writes the ICIS Chemicals and the Economy blog, and John Richardson, director, ICIS training Asia, who writes the Asian Chemical Connections blog.

By: Andy Brice
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