Industry 4.0 opportunities for the Chemicals Industry


Industry 4.0 opportunities for the Chemicals Industry

Integrate Industry 4.0 into the Chemicals value chain

Although the concept of Industry 4.0 was introduced about five years ago, many companies are still searching for the best way to integrate it into their value chain. The chemical industry is in a great position to benefit from Industry 4.0, for instance because they often have an abundance of historical sensor data available. But how can you use the new technologies to your benefit?

André Barneveld Binkhuysen & Marjolein Schipper - 4 July 2016

Overview of Industry 4.0

Industry 4.0 revolves around the physical-digital-physical cycle. Physical information, such as product and process data, is digitized using a wide array of sensors and combined into a digital data storage. (Physical to Digital) The data can then be used for (advanced) analytics. (Digital to Digital) The results of the data analysis is used for (automated) decision making which results in movements in the physical world. (Digital to Physical) You can use Industry 4.0 to both enhance your business operations and grow your business.


Enhance business operations

Business operations can be improved in two ways: by increasing productivity and by reducing risk. For example, advanced models can be used to do predictive maintenance, decreasing unplanned downtime. Process automation can be further improved by using real-time analytics and automated controls to react to changes in the process. For instance, weather changes might influence batch consistency and quality, which can be counteracted by incorporating weather forecasts in the control algorithms. This results in more predictable process outputs and higher yields.
Industry 4.0 technologies can also enhance supply chain planning. Demand forecasting allows for responsive scheduling and capacity optimization by combining data such as seasonal data, macroeconomic data and even social media activity into a demand forecast model, reducing the risks associated with out-of-demand products and holding costs for slow-selling stock. By monitoring the status of products in transit, customers can be guaranteed of products delivered within a specified range of parameters (e.g. temperature, pressure) and safe transport can be monitored as abnormal travel conditions are instantly detected.

Growing the business

Besides enhancing the current way of working, Industry 4.0 enables new business models and enhances existing ones. For instance, using big data and advanced analytics in R&D allows the development of new materials, with much lower investment costs needed, as digital simulations can be used to predict the outcome of experiments. Only favorable experiments have to be conducted in real-life.
New data services can be used to augment the existing revenues. Through linking your Industry 4.0 network with your customer’s networks, more tailored services can be provided. What about a service in which the characteristics of the supplied products are constantly tailored to downstream needs instead of the current model in which a fixed amount of product with certain specifications are delivered?

Where to go next?

If you want to build the capabilities needed for Industry 4.0, it is best to start with what you know or do best. For instance, start looking into the existing available historical process data and uncover new insights through novel analytics platforms. Make sure to set-up a cross-functional team as the capabilities needed for Industry 4.0 sit in different business functions and the applications for Industry 4.0 extend across the value chain. As some capabilities might not be present within the company, partnering with vendors and universities could help utilize underused data. However, as the interaction with partners is increased, special attention should be paid to the (cyber) risks involved.

To get more insight into the many possibilities, Deloitte Insights has recently published an article focusing on the many possible use cases for the chemicals industry: Industry 4.0 and the chemicals industry. Would you like to know more about Industry 4.0 opportunities for your organization or do you need help to define opportunities and set up a roadmap? Please contact André Barneveld Binkhuysen at +31 (0)88 2880003 or

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