Challenges and opportunities go hand-in-hand in the chemical industry these days. Technology is providing new capabilities, while customer, industry, legal, and market expectations are increasing at the same speed. Margins are dropping as trends are changing and markets maturing. On top of it all, the winds of political and economic forces are blowing hard.
Solutions are needed, and fortunately, the chemical companies are waking up to that fact. They realize that opening old doors won’t open new ways. I see a lot of creative workshops with interdisciplinary teams and innovation teams working hard to deliver something new and mind-blowing, and new roles emerging to tackle the challenges to change companies at their core. All of a sudden, making customers happy – and measuring it – matters to chemical companies.
To support the new way of work, big companies are trying to become more like startups to reduce internal barriers and be open to new approaches. I see this all over the planet, and some are succeeding with astonishing results. Even the most conservative chemical companies are trying their best to cope with the changes that customers and the new generation of employees bring to the table – but it’s not always easy.
In most cases, technology and business processes are not the biggest challenges. It’s usually the smaller, more personal things, like using the informal “you” in Germany or having a young, dynamic person in The Netherlands “tell it like it is” to a room full of senior American and Asian executives.
So why is it that, even though companies spend a tremendous amount of money on innovation, workshops, and new talent, a breakthrough still seems quite far away?
How can it be that with all the technology capabilities, such as artificial intelligence, machine learning, blockchain, and the Internet of Things, at their fingertips, chemical companies still move slowly from one level to the other? Everything seems so simple, doesn’t it?
“Man spends his life in reasoning on the past, in complaining of the present, in fearing future.”
– Antoine Rivarol
The answer might be complex, but I see three major issues:
1. The lack of empowered unicorns
I find them everywhere. Every company has at least one crazy mind, able to do what others wouldn’t dare. A person tolerated, supported, or protected by upper management, albeit with certain limitations. Some call this person a “free radical.” Crazy ideas are welcome. The moment they are introduced live into operations, things change. Former supporters withdraw, sponsors disappear, the old pattern wins.
These unicorns are doomed to live in a golden cage. They are too wild for conservative companies, even though they are wanted by the very same companies. I see them leaving.
2. Missing relevance
It is good to have a department to test things, regardless of their business use. Nonetheless, in my experience, many businesses lose trust due to the “useless” solutions, products, and tools these departments deliver. It was never crystal-clear what to expect from them and why they are relevant to the company. It’s just another innovation department, and if there is one term we could discuss endlessly, it would be “innovation.” Coming up with “useless” stuff might be part of the job description. Others may call this “being disruptive.” Businesses don’t have time for minor tests of fictional things since their job happens in reality. This creates a clash of departments.
Award-winning digital excellence, IT, process management, R&D, etc. ideally has a counterweight such as:
- Solved problems for the customer
- Improved service, which leads to measurable satisfaction
- Increased satisfaction
- Positive business growth (top of the top)
Bridging these two worlds could help bring fiction closer to reality.
3. Risk avoidance
The chemical business is not a game. The industry deals with dangerous materials, must control where products are shipped and who is receiving them, and has a huge responsibility to the environment and society – our future! Dealing with all these assets and production sites requires 100% accuracy and legal compliance. Given all of the trends we see in the chemical industry, taking risks might not be at the top of CEOs’ agendas. On the other hand, isn’t not taking risks the biggest risk of all?
And yet, there are customers requiring innovation, better service, a faster, relevant and contextual information flow, and modern collaboration to get ahead of the competition. Other players (barns full of unicorns), often unknown to big companies, are ready to disrupt former solid relationships and markets by offering totally new approaches.
Some companies are better than others when it comes to find and fix. The better you know your complex process, the better you find anomalies. But this is the point: To know a complex system, you need to keep it controlled and ideally unchanged. Keeping things unchanged prevents you from moving forward. Your customer isn’t paying you because you manage your complex processes.
Predicting and preventing are the new champions. If you want to play in that league, you should agree with its terms and conditions, let your teams know it, and give them the freedom they need to test, implement, and run.
There is a difference between a beautiful horse and a magical unicorn. Decide and commit.