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Chemical Supply Chain

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Increasing Commercial Viability of Your Chemical Supply Chain Making SC Contributions Visible

By Andreas Claussen

LogiChem 2011 will be the event's tenth anniversary and an opportunity for the most senior chemical supply chain & global logistics directors from the European chemicals community to come together once again share experiences, make new contacts and benchmark the latest chemical supply chain initiatives.

Not only will LogiChem 2011 be a chance for the chemical industry to reminisce about the last ten years but an opportunity to shape the next decade. To celebrate a decade of LogiChem, there will be an exciting three day programme filled with networking opportunities in our new location, Antwerp.

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Chemical Supply Chain

  1. 1. Increasing Commercial Viability ofYour Chemical Supply ChainMaking SC Contributions VisibleLogichem 2010Andreas ClaussenDirector Global SC & Information Management, BASF Intermediates
  2. 2. Operating Division IntermediatesKey Characteristics of BASF Intermediates Butanediol Polyalcohols Acids & Specialty Amines & Derivatives & Specialties Intermediates 1.9 bn Sales to 3rd Parties in 2009 > 600 product species 2.5 million t/a 3.000 customers serving a broad variety of industries like Plastics Agro Construction Pharma GasTextile Textile Treatment Chemicals06.04.2010 logichem 2010, Düsseldorf 2
  3. 3. Operating Division IntermediatesIncreasing the Commercial Viability of YourChemical Supply ChainKey Topics Fitting Your Supply Chain into Commercial Objectives Aligning Your SC Strategy with Business Needs Fostering Commercial Orientation in Your Team KPIs to Drive Commercial Performance=> Making SC-Contributions to Business Success Visible06.04.2010 logichem 2010, Düsseldorf 3
  4. 4. Operating Division IntermediatesCommercial Viability in all Main ProcessesSC-Model according to SCOR PlanMake Deliver Source Make Deliver Source Make Return Return Your Suppliers Your Business Your Customers => Generating Economic Value06.04.2010 logichem 2010, Düsseldorf 4
  5. 5. Operating Division IntermediatesFitting SCM into Commercial ObjectivesSimplified Value Tree Delivery Capability Sales Delivery Reliability Non Conformances CM1 Order Pattern, Lead Time SC Influence - Variable Packaging, Labeling Costs EBIT Production Site, Plant Production Campaigns Freight Costs € - Fixed Costs Infrastructure Average IT-Tools & Costs Fixed Cost of Cap. + Assets Container Fleet - Capital x Costs Inventory, Structure Operating Inventory Assets Demand F’cast, Volatility How to actively shape the Supply Chain Set-up?06.04.2010 logichem 2010, Düsseldorf 5
  6. 6. Operating Division IntermediatesAligning SC Strategy with Business Needs Differentiation Innovation Collaboration Constraints => SC-Design according to Business Model06.04.2010 logichem 2010, Düsseldorf 6
  7. 7. Operating Division IntermediatesExample for active Supply Chain DesignSupply Chain OptimizationStarting Point Payload Payload Payload - X Payload + X Payload + XFinal Design Improvements Results Freight Costs Logistics Costs => €/t * 0.5 Infrastructure Same assets => Volume * 2 Order Process Additional Biz => CM1 * 306.04.2010 logichem 2010, Düsseldorf 7
  8. 8. Operating Division IntermediatesFostering Commercial Orientation in Your SC-Team Communi- Contribution cation CommercialWhat helps us? Spirit What hinders us? Many Opportunities No P&L for SCM Tangible Examples „It‘s my job anyway“ Recognition Commercial Thinking Evaluation Difficult => It’s more than savings!06.04.2010 logichem 2010, Düsseldorf 8
  9. 9. Operating Division IntermediatesCommercial Viability of Your Chemical Supply ChainSummaryMaking Your SC-Contribution Visible K PIs Understand your Business Model Needs & Limits # Translate your SC-KPIs into Monetary Value +# % Evaluate Supply Chain Contribution to Biz Success -# % % # %+ # - Assess your team‘s Specific Share (not shy, not bold) %+ % Agree share with Other Contributing Functions Collect examples in a Log-file for Communication Use €-Contribution Target to focus team’s effort06.04.2010 Do Good… and Talk About It !! logichem 2010, Düsseldorf € 9
  10. 10. Operating Division IntermediatesIncreasing the Commercial Viability of YourChemical Supply ChainKey Topics Fitting Your Supply Chain into Commercial Objectives Aligning Your SC Strategy with Business Needs Fostering Commercial Orientation in Your Team KPIs to Drive Commercial Performance=> Making SC-Contributions to Business Success Visible06.04.2010 logichem 2010, Düsseldorf 10
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