Time is ripe for chemical industry to grasp digitisation – Accenture
BARCELONA (ICIS)–The chemical industry is gradually becoming aware of the benefits that digitisation can offer in terms of efficiency and cost savings, but it will take a leap of faith to move from awareness to spending money and being prepared to alter business processes.
Chemical companies are opening up to digitisation and, anecdotally, ICIS journalists are hearing of more examples across the industry.
Consultants at Accenture are so convinced that the age of digitisation is upon us that they have launched a new practice known as Industry X.0 aimed at helping companies tap into new technologies.
The group claims that the average chemical company could boost market capitalisation by more than $4.4bn through adoption of an optimum combination of new technologies.
They also estimate cost savings of $91,261 per employee are achievable.
Pete Frandina, North America Industry X.0 lead, said to ICIS that technologies need to be combined and not seen in isolation to get the maximum benefits.
Remote monitoring and communication between employees on sites can help with allocation of resources as well as safety and protection.
For example, wifi, cellular and radio frequency identification (RFID) can be combined with real time gas detection systems worn on the person, allowing employees and control rooms to react quickly to emergencies.
“You have the combination effect from getting safety and productivity benefits by having the ability to use active cellular technology in a fairly dense industrial setting,” said Frandina.
Another area where this technology could save time and money to chemical companies, said the consultant, was plant turnarounds.
By monitoring employees and contractors as well as equipment it is possible to identify bottlenecks and inefficiencies in real time, which allows managers to begin to take what was a qualitative situation and add measurable, quantitative elements.
Frandina has worked with companies which have achieved up to 20% in labour cost savings on plant turnarounds buy using this technology.
Because it is real time, learnings from one day can be applied to the next, allowing continuous improvement over the course of a turnaround.
Early adopters of new digital technology in chemicals are already using devices for workers which allow them to pull in information whilst out on site, including any digital documents, training videos, or hooking up live to get advice from more experienced technicians.
Labour costs in the US’ chemical industry, for instance, have spiralled up to $100/hour amid the shale-based construction boom, and this factor would give companies an extra impetus for investment.
Collection and analysis of data on a massive scale is another new area where the industry can benefit, as chemicals is a highly globalised sector and this can result in data being stranded.
“Digitisation allows data to be gathered in a more centralised manner where intelligence can allow data to be presented to operational team members in new ways. By comparing sites or equipment, new insights can be given to decision-makers,” said Frandina.
Artificial intelligence can now analyse data over time such as tempe
rature, pressure, flow, plus installation and overhaul history to give enhanced insights for processes and equipment. Analytics can help predict and prevent breakdowns.
To implement a digitisation strategy, companies need to be open to change. Pilots can be carried out at one or two facilities. Next, a plan needs to be implemented across the business.
“You will need structures in your organisation to take the vision and then scale things up that drive value whilst moving on from aspects that do not work out,” according to Frandina.
More rapid prototyping means technology can now be implemented and tested in weeks rather than months or years.
Where companies can fail is the next step: they may be happy with the pilots but do not have the infrastructure to scale the technology across 30-40 sites.
“Digitisation is not just about driving out costs but also developing alternative sources of revenue. You can enhance the services you offer, getting top line growth as well as better customer stickiness,” concluded the Accenture consultant.
Picture source: Sebastien Salom-Gomis/SIPA/REX/Shutterstock
Focus article by Will Beacham
Global News + ICIS Chemical Business (ICB)
See the full picture, with unlimited access to ICIS chemicals news across all markets and regions, plus ICB, the industry-leading magazine for the chemicals industry.
Now, more than ever, dynamic insights are key to navigating complex, volatile commodity markets. Access to expert insights on the latest industry developments and tracking market changes are vital in making sustainable business decisions.
Want to learn about how we can work together to bring you actionable insight and support your business decisions?