SAP S/4HANA For Chemical Industry

Our working lives are improving, and our company processes are becoming more swift, effective, and agile thanks to cloud technology. However, making the best individual software decisions can be challenging and result in several contracts, SLAs, and systems requiring provisioning. With margin challenges, changes in how customers use and pay for their goods, and the requirement for strategic agility to reduce cycle/lead times in response to market dynamics, chemical firms are experiencing transformative developments in their business landscape.

The companies that can go beyond providing goods and services and deliver outcomes that benefit the community will be tomorrow’s winners. Their success will depend on their capacity to handle these trends. Using an industry-focused, SAP-qualified solution, learn how to handle end-to-end enterprise business operations, including production planning, execution, logistics management, and statutory compliance.

RISE with SAP, introduced in January of this year, was developed to assist clients in leveraging their software preferences by mixing contemporaneous software with SAP S/4HANA to change their operations. Business transformation-as-a-service is the focus of rising with SAP, which offers access to SAP S/4HANA Cloud, a choice of infrastructure provider, business process intelligence, custom code migration, SAP Business Network Starter Park, and course, the SAP Business Technology Platform in a single engagement.

Why should any chemical business think this offer is worthwhile?

First, S/4HANA is the foundation of rising. This refers to the S/4HANA private cloud in the case of the majority of chemical companies. S/4HANA private cloud’s new features relevant to the chemical industry range from advanced production planning to advanced available-to-promise that includes allocation and supply protection capability to a rearchitected finance module that enables granular product costing and margin analysis (M&A, anyone?).

Second, chemical companies frequently have ECC systems that have accumulated years of customization that, at best, make upgrading to the latest release difficult and, at worst, actually hinder business processes that may have changed in the roughly 20 years since the original systems were implemented. Chemical companies are some of the oldest SAP customers.

As a side note, when I look at the adoption history of SAP R3/ECC, the largest wave of implementations in chemical industries occurred before the year 2000, indicating that these businesses have a good long history with SAP systems that are currently very distant from being cutting edge.

The first two reasons address the software “content” of the service. The two remaining reasons focus on the business model and the services included in the package, both novel for SAP.

The chemical industries have set strategic priorities to aid in their journey towards digital transformation. Identifying strategic priorities and their advantages for the chemical industries should come first.

Chemical Industry Strategic Priorities

Chemical industries should make it a priority to examine their entire business model and be ready for it to start the change.

Chemical Industries focuses on adopting the four main strategic priorities outlined below to achieve this customer-centric intelligent digital transformation:

  • To help sell business results rather than just items.
  • Streamline to reduce cycle time
  • Rival as an ecosystem
  • Strategic agility should be used in response to market circumstances.

It’s time for the chemical industries to reinvent themselves by integrating an intelligent ERP system called RISE with SAP, enabling you to innovate goods and redesign entire business models and processes to meet the above priorities.

Adopt strategic agility in response to market dynamics

Strategic agility should be used in response to market circumstances.

More and more companies are using mergers, acquisitions, and divestitures to speed portfolio changes and diversify into promising new markets or segments in the current competitive climate. It takes so long to realize the projected synergies and incorporate the purchased firms into current portfolios. However, this is why many such initiatives fall short.

Let’s analyze two companies to better grasp this:

  1. Company X has a non-SAP ERP system
  2. Company Y uses an SAP-ERP system

These were the difficulties that Company X encountered because a non-ERP system controls every aspect of its business model:

  • The conventional fundamental functionality of the current system software was restricted to post-merger integration.
  • Acquisitions like prebuilt models, integration frameworks, and technologies took a while to integrate.
  • It was necessary to keep an eye on the synergies, which involved executive monitoring and key-value driver analysis.

As a result, their system operated slower than anticipated due to insufficient integration of their traditional system, which led to high participation in manual operations.

Let’s look at Company Y, which uses an SAP-ERP system, where: Improved product development decisions are made by real-time monitoring of financial project KPIs.

  • Real-time access to resource availability, skill sets, and organizational assignment during the project staffing process.
  • Real-time alerts based on production bottlenecks and resource constraints, such as component or time delays, were beneficial.
  • The “Master Data Governance” program ensures that master data is correct, consistent, and current throughout the organization.

From pre-deal appraisal to post-merger integration and divestitures, Company Y’s Intelligent ERP [RISE with SAP Package] system offers a Closed-loop, E2E approach to cover all elements of mergers, acquisitions, and divestitures.

Leading Value Drivers

Following the successful implementation of SAP S/4HANA, the following are the main value drivers in the chemical industry:

  • Market share increased in a good way.
  • There has been significant revenue growth. Synergies were realized.

You might now be wondering how RISE with SAP will benefit. The main business features they provide to help you accomplish your goals. You can dynamically adapt a strategy and portfolio to market possibilities and needs. Also, you can swiftly diversify into new markets or industry areas and makes money through mergers, acquisitions, and spin-offs.


In conclusion, SAP S/4HANA is a one-stop solution that can give the chemical industries intelligent and sector-specific benefits through a digital core ERP system that aids them in innovating markets and selling products, operating manufacturing plants, maintaining assets, and building a responsive supply chain. To learn how SAP S/4HANA or other solutions can benefit businesses in the chemical industries, get in contact with us.

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