Chemical Industry

A Solution for Chemical Industries on
SAP S/4HANA & SAP ECC

Chemical Manufacturing

An Overview

 

Chemicals can be manufactured in batches or lots or in huge volumes as a continuous process. While there are different categories of chemical, they are broadly classified into basic, specialty and consumer chemicals.

Basic Chemicals comprises of Polymers, Basic Inorganics, Petrochemicals, and other chemicals derived from coal & biomass. Specialty chemicals include chemicals required for insecticides, pesticides, paints, inks, dyes & pigments, and other chemicals used by industries like textile, paper etc. Consumer Chemicals include soaps, detergents, cleaning liquids etc.

Whatever type of chemicals they are manufacturing, chemical industries face some common challenges related to market, supply chain, production, quality, safety & environment and compliance

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Major types of pharma businesses in India

Market Conditions

Most chemical industries shut operations or lowered the scale of operations during the pandemic and faced huge losses. Most of them have resumed operations but will take time to come out of the losses. Transition to GST regime was not as smooth as anticipated. Import of chemicals is becoming cheaper with lower import taxes and entry barriers.

Sourcing & Procurement

Your sourcing personnel need to identify and nurture suppliers who can supply materials as per specifications, at the required price, time and location while meeting their obligations to environment and safety of their workforce. Your procurement team should be able to procure material as per specifications and ensure that all material reaches your manufacturing locations or warehouses at the required time and at lowest price.

Logistics

You may use multiple packing like pallets, drums, bags, cases and even customer-specific packing while you may use containers, tankers, pipelines, rail cars to transport your finished product. You may procure and store in a certain UOM, consume in a different UOM and sell in another UOM. You should maintain safety and avoid spillage during transport between your units or to your customer locations.

Environment & Safety

You should provide a safe working environment to your personnel and ensure your products are safe to your customers and their applications. You should maintain your equipment frequently to avoid machinery breakdowns and accidents such as leaks, fires etc. You should record Material Safety Data Sheets of all your supplies from vendor and generate the same for the material you supply to your customer.

Production

Formula or recipe management, Capacity Optimization, Lot and / or Batch sizing and sequencing, Production Planning & Scheduling, Rework of off-spec material, Accurate cost distribution and management are the most known challenges related to Production processes of a chemical manufacturing unit.

Quality

Managing and monitoring quality of raw material, intermediates and finished products is a complex task with varying grades and quality of material supplied. You should maintain quality plans for all materials and record results of all quality tests. You should also issue Quality Certificates of material supplied to your customers and maintain Quality Certificates received from suppliers

Compliance

Chemical Industries are subjected to stringent local compliance and regulatory requirements formulated by various ministries such as Ministry of Environment, Forest & Climate Change. Depending upon the products you produce, you may have to meet the requirements of various government agencies such as pollution control boards and environment protection agencies etc. If you are importing your products to countries in Europe or to the USA, then you may have to meet the requirements specified by their countries. You may also have to meet the Carbon footprint targets set internally or by the government bodies.

As a Chemical manufacturer, you need a system which helps you in building an efficient Supply Chain while running Production and Quality processes that help you deliver quality chemicals on promised dates to your customers. The system should help you in your research journey as well as local and international compliances related to quality, safety and environment. You should be able to monitor your business real-time and respond to any situation immediately.

Keeping these challenges and opportunities in perspective, we have designed and developed a solution on SAP ERP  specifically for Chemical manufacturers, which is being used by several organizations in India.

Our Solution

Main features of our solution for Chemical Industry

 

An enterprise application for a chemical manufacturing business should meet these requirements and help the business in addressing the associated challenges.

Our solution is specifically designed to do this! Our team of business experts with vast experience in Chemical Industry have identified major requirements of chemical industry and developed this pre-configured solution, certified by SAP SE.

Our solution enhances the capabilities of SAP S/4HANA and helps you in managing your sales, production, quality & logistic processes specific to chemical industry apart from supporting back office functions like accounting and human resources. We constantly update our solution with improved planning & scheduling processes along with latest compliance requirements and release them in the form of service packs.

Major components of our solution are listed below.

Baseline Solution

Preconfigured Cross Industry processes on SAP ECC or S/4HANA

Chemical Industry Add-on

Add-on Solution with Chemical Industry Processes & Analytics

Other SAP Apps

SAP Analytics Cloud, Concur Travel & Expenses, SuccessFactors, Fiori, Solution Manager etc.

Baseline Functions

Cross-Industry Functions & Features on SAP ECC or SAP S/4HANA

Standard processes across functions such as Finance, Sourcing & Procurement, Sales, Supply Chain, Quality Management, Production etc. are pre-configured and available for use readily. All processes are available with local tax compliance and reporting requirements.

For example, processes such as procurement of raw material, assets, services etc. are already configured with various release strategies and Purchase Order layouts with the required tax procedures. Processes supporting Domestic Sales, Exports, Online Sales etc. along with invoice layouts are already pre-configured and available to use. Chart of Accounts that supports local and international reporting requirements are available along with the Legal & Statutory reporting templates.

Ready-made tools are available to migrate your Master data and open items. Analytical reports across various functions are readily available.

You can adapt to these pre-configured processes or customize where required and start using the solution quickly. The Baseline functions included in this solution are listed below.

Finance

for managing receivables, payables, finance closing & reporting

Sourcing & Procurement

for managing suppliers, buying material and sources

Supply Chain

for managing Inventory, Delivery, Transportation and Warehousing

Sales

for managing customers, pricing, orders, and contracts

Manufacturing

for production planning, scheduling & operations, managing quality

Asset Management

for equipment maintenance planning and operations

Service

for managing customer support & complaints

R&D / Engineering

for new Product Research & Development

Embedded Analytics

for using built-in analytics across sales, finance, purchasing etc.

Digital Compliance platform

for taxes, legal & regulatory reporting specific to India

Chemical Industry Addon

Apart from the baselines functions, we have included processes and features which are specific to Chemical Industry in our solution. These features are available to organizations producing Basic Chemicals, Specialty Chemicals & Consumer Chemicals.

Using the native functions & features of SAP ERP, we have incorporated features to support CxP practices related to Manufacturing, Laboratory, Distribution and Storage of all material used in Chemical production. All these practices support various local and international compliance requirements such as FDA, MHRA & HACCP.

Some of the important features specific to Pharmaceutical Industry are listed below.

  • Multiple production stages & sites, storage sites & demand points
  • Batch & Continuous process scheduling with Capacity Optimization
  • Serial Numbering, Batch or lot Sizing, Sequencing & Timing
  • Real-time material substitution during production, based on raw material grade or availability of stock or work center capacities
  • Multiple finished products, by-products and co-products produced from a single raw material
  • Various types of packing used - drums, pallets, rolls, totes, super sacks etc.
  • Inventory Tracking of returnable packaging material
  • Customer-specific packaging & labelling instructions, which are different from your standards
  • Transporting material using containers, rail racks, tankers, pipelines etc.
  • Quantity conversion between various Unit of Measurements
  • Use of Batch Attributes across procurement, quality, production and sales processes
  • Recording Material safety data sheets (MSDS) from material suppliers & Generating MSDS for customers
  • Off-specification material processing using any of the options - scrap, rework, regrade or re-blend
  • HACCP and REACH compliance

Other SAP Applications

Add more capability to your Chemical Solution on SAP ERP

In addition to the Baseline solution & Chemical Add-ons, you can implement additional SAP Applications listed below which are customized for Chemical Industry.

SAP Success Factors

for managing core HR functions, Payroll, Talent, Learning along with Workforce planning and Analytics

SAP Concur

for planning, requests, approvals and analysis of business & travel expenses incurred by your personnel

SAP Analytics Cloud

for Descriptive, Diagnostic, Predictive & Prescriptive Analytics of your business

SAP Fiori

for enabling several transactions, reports & analytics on IOS devices

SAP Solution Manager

for Document Management, Test Management, Incident Management & Integrative Change Management

Connect with our Chemical Industry experts to implement our Chemical Industry Solution on SAP ERP – whether ECC or S4/HANA.

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