Chemicals companies to spend more on digital technologies

PARIS--Chemicals companies’ investment in digital technologies will rise sharply in the next 3 years, with cloud computing and big data analytics expected to generate the highest return on investment, according to survey by Accenture.

In the survey, almost 94% of the chemicals industry executives who responded plan to increase their digital spending, with more than half or 54% projecting a significant rise. Over three-quarters or 77%  believe that the best returns will come from cloud computing (44%) and big data and analytics (33%).

Accenture surveyed more than 150 C-level executives and top management across the chemicals industry globally and found that a digital agenda is increasingly driving strategic decision making and commanding C-level support.

Majority of the executives (94%) agree that digital technologies will revolutionise the way they conduct business to a degree similar to the advent of the Internet in the 1990s. Additionally, 87% said that those companies that do not embrace digital will lose their competitive edge and may face extinction.

According to David Abood, global managing director of Accenture’s chemicals and natural resources, the world has entered a new age of a different kind of Internet – the Industrial Internet of Things, where sensor-driven technology and intelligent machine applications enable communications between a company’s assets, products and systems that were never possible before. To drive business values, companies need the data and advanced analytics capabilities that allow them to make better, faster and more-informed decisions, while using cloud computing to improve the efficiency of this data and systems management.

With the chemicals industry already facing significant logistics and supply chain challenges as a result of the shale oil and gas boom, applying a combination of digital technologies can help companies respond to market shifts by changing the way they operate.  

Most chemicals company executives surveyed (58%) are embracing digital to gain a competitive advantage over their industry peers. They believe that over the next five years, the biggest benefits from digital will include improved productivity (25%), redefined product development (24 percent) and impact on customer relationships (22%). And over the past three years, 90 percent said, their organization has increased its investment in employees dedicated to digital.

Accenture conducted an online survey of 156 C-level and top management executives in the chemicals industry. The survey was fielded in July and August 2014 and included respondents from petrochemicals, agrochemicals, paints and coatings, plastics and fibers, specialty chemicals and basic and intermediate chemicals companies in the United States, Germany, France, Austria, Switzerland, China, United Arab Emirates and Saudi Arabia. The companies represented by these executives range in revenue from $100 million to greater than $10 billion.