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About the Author

Laura Rokohl
Chemicals Supply Chain Manager
Aspen Technology

Laura Rokohl is the Chemicals Supply Chain Manager at AspenTech, specializing in supply chain solutions for the chemicals, polymers, and specialty chemicals markets. Laura has been with AspenTech for 12 years, working in a variety of roles, including implementation services, business consulting, and industry marketing. Laura was recognized as a “Pro to Know” by Supply & Demand Chain Executive in 2011. She conducts ongoing supply chain market research and has helped many chemicals, polymers, and process CPG clients define and improve their supply chain business processes.

Laura is a graduate of Texas A&M University and holds an M.S. in Operations Research from The University of Texas.

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Supply Chain Comment

By Laura Rokohl, Chemicals Supply Chain Manager, Aspen Technology

November 10, 2011

Cultivating an Agile Supply Chain in the Chemicals Industry

The Chemicals Industry Faces a Series of Unique Business Challenges, Which Require Careful Consideration Of the Current Supply Chain Structure and Practices



The chemicals industry today faces a series of business challenges. Rising costs of raw materials, regulatory issues, and vertical integration from bulk to specialty chemicals are creating the need for complex supply chains with many degrees of freedom. Product portfolios are expanding to drive new sources of revenue and higher margins, necessitating the creation of new markets and customer specific requirements to stay competitive. Business responsiveness becomes paramount in this customer-focused culture, putting pressure on chemicals producers to overcome the barriers to agility to improve profitability and continue to meet customer needs.


Rokohl Says:

Business responsiveness becomes paramount in this customer-focused culture, putting pressure on chemicals producers to overcome the barriers to agility to improve profitability and continue to meet customer needs.
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Unexpected Events Rule the Supply Chain


One thing is certain—supply chain disruptions will inevitably occur. The complex global supply chains of the process industries feel the ripple effect of events that previously had only local reach. A catastrophic event such as a tsunami or hurricane can impact feedstock availability, cause capacity outages, and disrupt logistics.  Of course, not all disruptions are a result of natural disasters—demand volatility is also a significant area of concern.


Barriers to Agility


Why do chemical companies that seem to have much of the infrastructure in place for an agile supply chain continue to struggle to achieve it?

  • Drowning in Data - Harnessing the necessary data to support supply chain management is labor intensive in that it often has to be compiled from disparate systems (ERP, manufacturing systems, etc.) and manipulated into a usable form.
  • Lack of Scenario Management and Modeling Tools - Chemical companies lack tools to help them understand the range of possible responses to an unexpected event, operational upset, or demand change.
  • Myopic Focus on Efficiency - Supply chain processes that focus on efficiency and cost control typically result in a modest improvement in return on assets (ROA), but not necessarily in agility or responsiveness.


Cultivating an Agile Supply Chain


Best-in-class companies are leveraging technology and using agile supply chains as a competitive differentiator. But what steps can chemical companies—especially ones that already have much of their supply chain infrastructure in place—take to foster agility in their supply chain?


Visibility and Fact-based Decision Making


Visibility into the right information is half the battle. Transforming the sea of data into a usable format facilitates decision-making based on facts and economics, rather than focusing on just solving the crisis of the moment. An easy to use interface with advanced exception reporting directs users to the highest priority problem and helps them hone in on the specific information required to make decisions.


Expect the Unexpected …. and Plan for It!


The ability to perform rigorous business simulation via what-if analysis is a ‘must-have’ for chemical manufacturers. Without this capability, companies are blind to both profitable opportunities and potential risks. Best practices dictate developing a ‘playbook’ to respond to unplanned events, both upside opportunity scenarios and downside risk mitigation scenarios.


Adaptability and Alignment


In addition to changes in supply and demand, companies face changes in markets that can alter their supply chain strategy. If chemical manufacturers don’t adapt their supply chains, they won’t stay competitive for very long. In terms of technology, this means keeping the systems that support supply chain functions aligned with your business.

Final Thoughts

The best supply chains aren’t just fast and cost effective. They are also agile and adaptable, and they ensure that all stakeholder interests are in alignment. While it is hard to assign a monetary value to having the ability to react, agility drives improvements in customer service, asset utilization, and inventory management.

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