Chemicals Industry Transformation: SAP’s Foundation for Strategic Growth – Part 2

Establishing a robust foundation for cost management and strategic growth is just the beginning in the chemicals industry, as discussed in the first part of this series. This conclusion of our interview with Brandon Evans, VP, Customer Transformation at NTT DATA Business Solutions, explores how SAP solutions, integrated with AI, enable chemical companies to optimize operations, manage regulatory complexities, and empower cross-functional teams with data-driven insights.

Catalyzing Operations and Supply Chains

AI, when integrated across the SAP ecosystem, can potentially transform chemical manufacturing and supply chain operations significantly.

Evans elaborates that by embedding intelligent algorithms within platforms like SAP Integrated Business Planning (IBP) and SAP Digital Manufacturing Cloud, chemical companies can leverage real-time data to deliver enhanced demand forecasting, predictive maintenance, and agile decision-making across the value chain.

“For example, AI-powered tools within SAP enable organizations to sense fluctuations in demand by analyzing external variables like weather and economic trends, significantly improving forecast accuracy,” Evans says. This level of predictive insight is critical in sectors tightly coupled with volatile markets, such as agriculture or automotive.

Chemical manufacturers can also leverage AI for real-time anomaly detection and process optimization, allowing plant managers to proactively address quality issues and maximize output efficiency. “The combined impact is a shift from reactive to proactive operations, resulting in safer production, superior product quality, and expedited time-to-market,” Evans notes.

From Obligation to Integrated Advantage

The chemical industry is also one of the most highly regulated sectors globally. SAP equips chemical organizations to manage this regulatory labyrinth proactively, embedding compliance directly into core business workflows rather than treating it as a separate, reactive obligation.

“With SAP Environment, Health, and Safety (EHS) and Product Compliance solutions, companies centralize compliance management and automate key processes like substance volume tracking, real-time product checks against restricted lists, and managing hazardous materials,” Evans explains. “This ensures consistent adherence to stringent international regulations like REACH, TSCA, and GHS, while eliminating the inefficiencies and risks associated with manual oversight.”

SAP’s deep integration with R&D, procurement, and sales systems also allows compliance validation at every stage of the product lifecycle. Evans shares an example: “New formulations are screened against restricted substance lists during recipe development, and inbound raw materials are checked for compliance upon entry into the supply chain. Automated Safety Data Sheet (SDS) generation and country-specific compliance checks during distribution reduce the risk of regulatory breaches.”

Continuous regulatory updates, supported by cloud-based delivery and Content-as-a-Service models, keep organizations informed about emerging requirements. With comprehensive audit trails and automated reporting, SAP provides documentation traceability to navigate and adhere to global standards. “SAP transforms compliance from a burdensome obligation into a strategic, integrated process, enabling chemical companies to keep pace with an evolving regulatory landscape,” says Evans.

Collaboration With People and Processes

“Collaboration across technical teams and business process owners isn’t always easy in an industry defined by product complexity, intense regulatory pressure, and the need for operational agility,” Evans notes. However, SAP’s unified digital environment does much to bridge this divide by seamlessly integrating technical capabilities with core business workflows.

For example, SAP S/4HANA serves as a shared data foundation for IT and business users. This eliminates fragmented spreadsheets and ensures everyone works from a single, real-time source of truth, streamlining processes like recipe development and product compliance.

“For supply chain planning, SAP IBP aligns demand signals and supply constraints, while SAP S/4HANA executes material availability checks, giving planners, procurement, and sales teams synchronized, real-time insights that support faster, better decisions,” Evans notes, sharing another example of collaboration between teams.

Predictive maintenance presents another powerful use case where SAP bridges technical expertise and business need. Maintenance engineers and data scientists leverage Predictive Asset Insights to anticipate equipment failures, while plant managers and finance embed these insights directly into operations and budgeting processes.

Data Management: A Crucial Element

Effective data management and analytics are paramount for chemical companies. They lay the groundwork for driving efficiency and compliance and provide the foundation for advanced AI initiatives within SAP environments.

“By leveraging SAP Business Technology Platform (BTP), companies can unify real-time data flows, embed analytics for actionable insights, and maintain rigorous data security and compliance,” Evans emphasizes. “The goal is better decision making with better data.”

He concludes, “We help customers get there by looking at their specific needs, regardless of where they’re starting. Each journey is unique.”

What This Means for SAPinsiders

Embrace AI for proactive operations. Beyond foundational ERP, SAP’s integrated AI capabilities in platforms like SAP IBP and SAP Digital Manufacturing Cloud are transformative. SAPinsiders in the chemicals industry can leverage AI for enhanced demand forecasting, predictive maintenance, and optimizing formulations, shifting from reactive problem-solving to proactive, data-driven strategies that improve quality and time-to-market.

Integrate compliance for strategic advantage. In a highly regulated industry, SAP turns compliance from a burden into an integrated strategic process. Solutions like SAP EHS and Product Compliance automate critical checks throughout the product lifecycle, from R&D to distribution, ensuring continuous adherence to global regulations and robust audit trails for a confident, proactive approach for SAP users.

Unify teams and data for actionable insights. SAP’s unified digital environment bridges the divide between technical and business teams, fostering collaboration through shared data foundations like SAP S/4HANA. NTT DATA Business Solutions guides chemical organizations in customizing data roadmaps, implementing advanced data governance tools, and deploying accelerators tailored for regulatory and operational requirements.