For many years the global chemicals industry has been facing declining margins, product commoditization, rapidly expanding competition in developing countries, and customers demanding more at lower prices. These trends are forcing the industry to undergo rapid change that will continue into the next decade. As such, chemical companies must adapt quickly to maintain a competitive edge, overcome challenges, and embrace new market opportunities.
Reducing costs and increasing efficiency are the main reasons for implementing BPM and ERP systems in the chemical and pharmaceutical industries. Companies in the chemical industry must adhere to countless regulatory standards (EMA, FDA, BRC, IFR, GHS etc.), as well as GMP guidelines.
Small to mid-sized chemical companies therefore require ERP systems that allow them to model all legal and GMP regulations while designing more efficient production processes, logistics, and supply chain management (SCM). Savings and flexibility in these areas are particularly decisive in enabling small and mid-sized chemical companies to remain competitive.
Benefits Supporting Key Initiatives for this Industry
Compared with other industries, chemical companies are among the least confident in their pricing decisions and the least likely to raise prices regularly. The complexity of recipes or formulas makes cost tracking a challenge for process manufacturers. Ideally, the cost of every ingredient should be tracked, based on the quantity used and its chemical characteristics (e.g. potency), Furthermore, the cost of wasted raw materials and ingredients also needs to be tracked as accurately as possible. Without all of these details, process manufacturers cannot estimate their total actual costs per unit or compare this with the sales price to determine profit margins.
Accurate monitoring of manufacturing to maximize throughput enables manufacturers to respond proactively to problems and reduce downtime in the plant. With increasing bill of material complexity and multi-constraint production resources such as machines, tooling and labor skills, your ability to provide accurate customer delivery dates is getting to be a complex task. In some cases, production staff record data on paper, creating a lack of production visibility, especially when trying to manually plan multiple resource types simultaneously.
Recipes and formulas in process manufacturing are not only complex - they also don't leave much room for errors. A minor change in quantity of one ingredient can lead to quality management issues, or could compromise an entire batch. While defective production batches can be adjusted to improve their quality, this process can be very complex, since manufacturers need to consider all possible chemical reactions caused by adding ingredients that were not part of the original recipe. While it is difficult to eliminate waste, process manufacturers can use ERP systems to calculate an estimated level of waste, track the actual waste and compare the two to improve efficiency in production operations.
Key functions to optimize your planning processes
Real time data access in production is vital whether it is related to products, processes, or machines operating in the factory. In the past, when production fell short of established goals manufacturers traditionally added more machines and operators to the workforce. While this may temporarily address the problem by raising output to accomplish production goals, it also raises overhead costs by increasing capital expenses, utilities, facilities requirements, parts usage and more. This also increases the need for more supervisors and administrative personnel, adding to indirect labor costs. Traditionally, real time information access for processes has not been available at shop floor level.
Quality management is critical for process manufacturers needing to comply with a plethora of laws and regulations, which can vary depending on where the products are made and sold. Poor product quality can lead to health hazards such as bacterial contamination, or environmental issues such as pollution caused by dangerous chemicals. Apart from the impact on the company’s revenue and fines that may be incurred, these issues also impact the manufacturer’s brand. It usually takes years and a lot of effort for companies to regain the trust of consumers, which is why manufacturers prefer to prevent these problems from happening in the first place.
Maintenance in the manufacturing environment is one of the most complicated types of maintenance in comparison to construction, transportation and service business. When an unplanned downtime event occurs in a chemical plant during off-hours, labor costs increase because of overtime, expedited materials and equipment needed for repairs, and production loss for significant periods of time. In the past, maintenance work was typically reactive. Schedules, usually established manually, lacked consideration for the capacity and availability of resources. As a result, these schedules were followed loosely, if at all. Now, scheduling assesses the availability of skills and parts and includes analytics for optimization.
Three trends to maintain competitive edge in the Chemical Industry
One of the trends is rapid globalization, which is generating new market entrants from emerging countries and other areas of the industry with innovative business models, concepts, and processes. This progress is in turn shrinking lifecycles and the rapid commoditization of products.
Scarcity of raw materials and an increase in regulations are realities that chemical companies must factor into their strategic thinking. Amid a drive to reduce material, energy, resource consumption and waste, regulatory requirements are rapidly expanding their reach at global, regional, and local levels.
A critical part of the foundations of these innovations are digital platforms that allow the rapid development of new products and services in a way that minimizes their impact on people and the environment. These platforms must also embed safety and compliance requirements in their lifecycles and monitor the impact of changes in regulatory requirements on products and services in real time, to enable chemical companies to respond accordingly.
All three of these trends converge to challenge the chemicals industry and influence the strategic decisions of leading global chemical producers. A company’s inability to respond within an acceptable timeframe to the pace of change of external factors will begin to add risk exponentially.
Beas Manufacturing Scales as the Business Grows
As your business grows and changes, you need a solution that can scale and adapt with you. Beas Manufacturing is modular in its design and offers flexibility in deployment, as modules can be purchased and activated during appropriate phases of implementation. The key vehicle that transforms Beas Manufacturing for Chemicals into a successful business solution is our embracing of SAP AIM (Accelerated Implementation Methodology).
We are working with more than 550 partners worldwide and provide them with global support from more than 9 global locations. Our partners have access to our Beas Manufacturing specialists for any questions they have around project quality assurance or functional support, ensuring that you, the customer, are getting the best service.
We provide our partners and customers with onsite training workshops, eLearning courses and implementation tools, which are founded in over 16 years of manufacturing experience. Beas Manufacturing is a long-term investment and we provide a flexible solution which you can, at any point in time, extend and enhance as your business requirements change.
Why Beas Manufacturing?
Largest customer base with 100+ in High-tech & Electronics
Built on industry best practice
Over 16+ years of industry experience
Complete combined solution for SAP Business One
With the widest capacity of 90+ countries
Active in 9 global locations
Working with 500+ partners worldwide
With over 16 SAP Business One awards