Innovation will be a key driver for success in the chemical industry, but only if the concept of innovation itself is reinvented.
In the run-up to CIEX 2019 we asked our speakers to share their thoughts on the industry’s innovation efforts and what must be done to successfully prepare for the future.
Braskem’s European CEO, Walmir Soller notes that the chemical industry is on the very beginning of a disruptive innovation curve and identifies a lot of space to grow. In his opinion, the industry grew over the years based on technological breakthroughs that brought to life exciting products followed by their incremental innovation. This has been enough for a long and profitable economic cycles. But now the industry needs to do more to cope with the pace of the market dynamics.
According to Soller, the future demands different approaches, not only based on the circularity of the products but also on the creativity of business models, to keep the industry sustainable and profitable.
“The pace of innovation is increasing exponentially, in different directions and forms. Companies need to look for ways to revisit their products and business models constantly to thrive in this new reality.” Wladimir Soller, European CEO, Braskem.
“Innovation is the combination of invention, technology deployment and business development”, says Steven de Boer, Sustainability Leader at the petrochemicals manufacturer SABIC. “I note that there are so many good ideas around, but the profit margins in the business are thin and the project risks are considerable. So unfortunately many good ideas do not make it. Therefore I strongly believe that we have to improve our implementation performance to realize more market deployment.”
De Boer feels that timeframes need to shift in order to prepare future investments successfully. The chemical industry was built by entrepreneurs who were thinking in 20-year timeframes, but currently 3-year timeframes are already seen as long. These short timelines do not allow the fundamental restructuring that is needed for the circular economy transition.
Professor Dr Klaus Kümmerer, Professor of Sustainable Chemistry and Resources at ISC3 (International Sustainable Chemistry Collaborative Centre) agrees with de Boer and adds that the Industry still innovates too much in terms of new products, materials and chemicals. Most innovations are only incremental ones in a short term view. True powerful innovations are based on a broader view and societal needs beyond chemicals, materials and products only.
“True powerful innovations are based on a broader view and societal needs beyond chemicals, materials and products only.”
To prepare for the future, Kümmerer feels that chemical manufacturers must avoid “sustainability washing” and learn that new business models are needed being less based on chemicals and materials. Furthermore it should be acknowledge that there are significant and insurmountable limitations of digitalisation and recycling. Both need energy and a specific material basis. On a cautious note , Kämmerer adds that digitalisation and recycling doe not necessarily make chemical industries greener or even more sustainable.
Kümmerer emphasizes that it has to be acknowledged that sustainable chemistry and green chemistry are not synonyms! Sustainable chemistry is the broad approach that is needed. Greener is not necessarily more sustainable. However, if done well green chemistry can successfully contribute to sustainable chemistry.
So what must (chemical) industry leaders do to prepare to remain competitive and prepare for the future?
Rainer Otter, VP for Regulatory Affairs at BASF feels that the need to listen to customers is paramount, in combination with the right human resource management: “Find the right people and provide them with a creative environment. Let them do their job and give them the support they need. Finally, a multidisciplinary team is needed with competencies that cover all the relevant aspects from basic research to market.”
Hear more from visionary industry leaders and innovation experts at CIEX 2019 on October 9&10 in Frankfurt/Main. Sign-up today and reserve one of the limited seats. Full details are available at https://ciex-eu.org.