As in almost every industry sector, the chemicals industry is finding that customer experience is now a driving force in how companies deliver value—and supply chain visibility is a critical factor in delivering those experiences. Traditionally, chemical companies have focused on developing products based on projected downstream demand in industry sectors such as consumer products, pharmaceuticals, engineering, and construction. But demand is now only one element of the new formula for success in the “experience economy.”
More chemical companies are embracing multi-channel approaches to engaging their customers. They’re seeking to provide self-service channels for orders and service and using the data they glean to anticipate customer demand and limit attrition. And they’re working closely with their value chain partners to commit to delivery dates.
The rise of the demanding customer
This fundamental shift in a longstanding business model is the result of evolving customer expectations. Chemical industry customers are drawing on their experiences as consumers and demanding the same level of personalization and responsiveness they experience in their retail transactions. In this new era, customers want more than reliable products, they expect specific outcomes and predictable value. They want products and services customized to their needs. They seek out providers with ethical sourcing and manufacturing practices and they want the in-depth visibility to ensure product integrity and traceability.
But no company can deliver on these heightened expectations on its own. As the pandemic showed, each company is only as strong as its supply chain. The sheer complexity of delivering advanced chemical products requires tight orchestration of effort and resources across the value chain. Providing the sustainable sourcing, reliability, and innovative products and services customers now demand requires the close synchronization of an entire ecosystem of partners.
Breaking down the silos that threaten the customer experience
Operational and information silos within the enterprise and across the value chain inhibit the agility and responsiveness that are central to competing in the experience economy. So how are the industry’s more innovative players building the collaborative networks that help them succeed? What tools and strategies are they employing to better compete as interdependent ecosystems and not loosely confederated partners?
Technology is playing a major role. Companies are responding to the new slate of customer demands with real-time, fully integrated supply chain planning capabilities to manage sales and operations, demand, response and supply planning, and inventory optimization. In other words, they’re treating every function within the enterprise and across the value chain as an integrated whole. Every facet of planning, production, sales, and service needs to support the same goals and operate using the same version of the truth. And this includes the processes shared with supply chain partners.
Collaborating for better customer engagement
Market-leading chemical companies are also forgoing the traditional product-based value chain in favor of a more collaborative approach that includes partners and industry thought leaders—including service providers, universities, research institutions, toll manufacturers, and technology providers. Together, these organizations are developing customer-specific solutions and applications for specific industry segments, such as automotive, high tech, aerospace and defense, and consumer products. They’re also finding new ways to overcome a rigid “one-size-fits-all” mindset in favor of segment-of-one relationships that provide the personalization that customers demand.
In the same way that companies have adapted to shifts in customer expectations, supply and value chains are becoming more adaptable as well. Chemical producers must constantly redesign their partner networks to keep pace with quickly moving markets. And data will play a central role in the process. Information shared throughout the partner ecosystem can provide the insight to better orchestrate an extended network of stakeholders to accelerate their response to everything from spikes in demand to customer preferences for consumer-grade online engagement. Based on the collective operational and experience data from the supply chain, companies can create the innovative services, products, and business models that help them stand out from their competitors and give customers a reason to do business with them, beyond price alone.
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