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How to Digitize your Supply Chain

Manos RaptopoulosCOO - South Europe, Middle East & Africa, SAP SE

Internal© 2017 SAP SE or an SAP affiliate company. All rights reserved. ǀ 2

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.

http://www.mckinsey.com/business-functions/digital-mckinsey/our-insights/the-internet-of-things-the-value-of-digitizing-the-physical-world

http://www.gartner.com/newsroom/id/3598917


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%


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/

http://3dprint.com/62642/cloudddm-ups/


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


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


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.


DEMO

Digital Supply Chain

SAP Leonardo

SAP Leonardo Bridge

, powered by

© 2017 SAP SE or an SAP affiliate company. All rights reserved. ǀ


“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


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


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


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


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


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.


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


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


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

Thank you!

Manos RaptopoulosCOO - South Europe, Middle East & Africa, SAP SE

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