Post on 27-Mar-2018
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Sources: www.mckinsey.com/business-functions/digital-mckinsey/our-insights/the-internet-of-things-the-value-of-digitizing-the-physical-world
www.gartner.com/newsroom/id/3598917
If policy makers and businesses get it right, linking
the physical and digital worlds could generate up
to $11.1 trillion a year in economic value by 2025.
IoT will unlock huge economic value
Gartner forecasts more than 20 billion
connected devices in 2020.
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90%of CEOs believe the digital
economy will impact their industry,
but less than 15% have a digital
strategy*
*MIT Sloan and Capgemini
#Accenture Study
of chemical companies are
embracing digital to gain
competitive advantage over
industry peers#
58%
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UPS opens 3D
printing factoryCloudDDM — Factory with 100
(Eventually 1,000) 3D Printers
and Just 3 Employees Opens at
UPS’s Worldwide Hub
Industry disruption
SOURCE: http://3dprint.com/62642/cloudddm-ups/
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Chemicals and Advanced Materials represent a significant world
economic engine
Sources: World Economic Forum/Accenture analysis; European
Chemical Industry Council; press research
Sources: Cisco; Fraunhofer Institute; IDTechEx; International Energy
Agency; MarketsandMarkets; Navigant Research; Radicati
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Estimated cumulative economic value for the period 2016 to 2025 ranges
The business case for Chemicals and Advanced Materials
US $310 bn - $550 bn
savings
60-100m tonnes
less emissions
2000-3000 less
injuries
Source: WEF Digital Transformation Initiative
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IoT driving value for Chemical Companies
New Business Scenarios
R&D Manufacturing SalesSupply Chain
Procurement Finance Human Resources
Digital Core
Innovation Live Hub
Closed-loop
engineering
Predictive Quality
Energy Management
Connected Manufacturing
Asset Intelligence
Network
Predictive Maintenance
Track and Trace
Logistics
Performance and usage
based billing
Omni Channel
Commerce
VALUE CREATION THROUGH:
Product innovation
• Industry 4.0 enabled
products and solutions.
• Extended product and
solution portfolio.
Process innovation
• Adaptive logistics
• Resilient production
• Energy management
• Predictive maintenance and
Service
Business model innovation
• Serving the “segment of one”
• Performance and usage-
based contracting and billing.
Digital Supply Chain
SAP Leonardo
SAP Leonardo Bridge
, powered by
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“SAP Leonardo brings industry-leading capabilities and
products together to provide the industry’s only Digital
Business System - built to not only drive innovation as
companies explore digital transformation, but to scale that
innovation and allow businesses to truly transform“
Bernd LeukertMember of the Executive Board SAP SE
Steering committee member for the German government’s Industrie 4.0 initiative.
SAP Plans to Invest $2.2 Billion in the Internet
of Things by 2020
SAP names IoT services SAP Leonardo,
debuts IoT kickstarter program
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Product
innovationMaking Sound, Fast Decisions
in R&D with information hub
Use scientific and patent
information more efficiently in
research and development
1000 Patents application in a year
80 million documents
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Process InnovationDigital ChemistryFrom test tube to tablet
Companies simulate properties and
performance of new products and
formulations via predictive models
Optimizing formulations with regards to
yield, cost, compliance, stoichiometry,
sustainability
Implementing closed loop Sample
Management from customer inquiry
through logistics
execution to customer feedback and
monetization
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Process InnovationProduct Compliance
Unified control of chemical
substance information
Reliable, central management of
chemical substances
Linkage of chemical substance and
supply chain data
50% faster response to customer
inquiries
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Process InnovationDigital Plant Operations
Digital manufacturing portal that
provides consistent, real-time
data, status reports, and historical
analytics from production systems
as well as user alerts.
Plant Performance Dashboard in
real time basis.
99.97% faster batch reporting
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Business Model
Innovation• Asian Paints, in addition to selling
paints thru traditional channels ,
started offering home décor
services whereby a customer can
upload the photo of his home and
get recommendations from Asian
paints along with the paint and
paint services.
• Asian Paints changed its
business model from selling
paints to selling experience.
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Why IoT is important for Digitizing Supply Chain…
Sources: IDC White Paper, sponsored by SAP, The Future Services Sector: Continuous Delivery for Competitive Advantage, 2017
McKinsey: The Internet of Things: Mapping the Value beyond the Hype, 2015
Asset optimization
10%–40% lower
service and
maintenance costs
New business models
15%–25% faster
revenue growth than
the industry average
Operations excellence
10%–30%
higher
productivity
Inventory optimization
20%–50% lower
inventory costs
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Success Factors
A lot of energy and momentum in the field of digital can be observed, Chemicals are catching up. It is not thequestion if, but rather what and how it will be done.
“
”Frithjof Netzer, Senior Vice-President,
Project Lead 4.0, BASF
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Points to consider
Buy | Build | Partner | Invest | Incubate
Devising a company specific strategy on IoT
End to End vs VerticalMake sure organisation is prepared
Cybersecurity is critical
Incremental (process)
Disruptive (business model)
Machine LearningEnsure Data Management & Governance
Foundation Scope