By Nina Kaun, Director of Product Management at Elsevier
For the chemicals industry, research and development is big business – over $51 billion is invested in R&D every year and two-thirds of CEOs are pursuing new products and services to drive revenue. Given the high cost of development, company leaders need to be strategic about new product development because by its very nature, the chemical industry is a high-risk environment. Recently, new opportunities for data-driven research have come to the forefront – supported by lower costs and greater availability of the supporting technology, as well as digital analytics capabilities.
Industry specific challenges range from the risk of losing knowledge as an aging, highly skilled workforce head towards retirement, to the need to keep costs low by developing more efficient processes, to an increasing movement towards sustainability driven by customer requests. The chemicals industry also has the additional challenge of managing the increase and changing world of regulations, given its role in producing, storing and selling potentially hazardous chemicals.
While other industries have embraced digital transformation to overcome similar challenges, the chemical industry continues to fall behind compared to other sectors; less than half of chemical companies have a concrete digital strategy or digital transformation roadmap. And while many have implemented some digital tools, the approach has been piecemeal, with different solutions used by different departments. While this is understandable given the complexity of the work undertaken, many solutions are not interoperable, leaving each department with its own unique software and data trapped in silos, limiting the value it can offer the business as a whole.
The value of the data driven approach
In the face of the challenges the chemical industry is encountering, investing in digital transformation will be extremely beneficial. A data-driven approach to R&D can help to support safer processes and products by reducing risk, as well as ensuring products are suitable and in turn more likely to succeed. Chemical companies can also improve their performance by uncovering better value suppliers or increasing yield – with digital transformation offering an ROI of up to five percent – helping them to remain competitive.
It not only saves time and money, it helps to ensure companies are more sustainable – meeting the expectations of customers. Instant access to the right information can also help chemical companies to comply with ever-changing regulations, including new guidelines addressing climate change or environmental impacts of R&D processes.
The sustainability case
Looking for ways to produce and bring more sustainable products to the market, chemical companies need the scientific and commercial data to support their decisions. This means understanding the research that has come before and applying knowledge of use cases and materials to highlight the demand for new products and processes.
When it comes to chemicals and sustainability, we have seen a steady increase in publications featuring both ‘chemicals’ and ‘sustainability’ on abstract and citation database, Scopus. The early 2000s saw a marked leap in publications, as did the mid-2010s, coinciding with sustainability becoming of more significant interest to industry. Although this is a general example, this type of data can be used by chemical companies to identify trends; driving more efficient R&D by ensuring demand before undertaking development.
Supporting data-driven R&D
To truly benefit from the potential the data-driven approach offers, chemical companies need to be able to aggregate data – from existing research internal and external, to commercial and scientific information, to regulatory data and everything in-between – and ensure every employee has access to the information they need, and that it is the most accurate, relevant and recent data.
In order to collate and analyze data effectively, firms need to carefully consider the tool they are using; while there are any number of offerings, when it comes to an industry as specific as chemicals and with constantly changing regulations, the choice of tool is vital. Using a non-specialist offering means the company risks missing necessary or important data.
Once they have invested in the right tool, chemical companies can be sure they have the right data to overcome the challenges the industry is facing, from commercial feasibility and compliance to environmental, health and safety concerns. This data can empower new product development in chemicals, with a focus on sustainability, welfare and regulation. Chemical companies can no longer afford to continue without digital, data-driven tools and processes if they want to succeed in today’s competitive, global chemicals environment.