Chemical companies find new ways to thrive in a challenging landscape
                     Innovation, pricing strategies and customer focus are helping chemical companies find new ways 
to thrive in challenging prospects.
Chemical enterprises are facing problems such as the slowdown of global economic growth, the 
interruption of trade and the weakening of end market demand in key industries such as 
automobile and construction. The general downturn in demand, coupled with the continued 
oversupply of bulk chemical products, has pushed down prices, making it more difficult to 
achieve organic growth.
For most of the past decade, many chemical companies have been investing in cost and 
efficiency as the growth agenda has faded behind the scenes. After years of integration, product 
commercialization, the rise of new competitors in growing economies and the increase of cost 
control plans, achieving organic growth has become more and more challenging.
Despite the slow growth, according to the 2019 survey data of Ernst & young capital confidence 
Barometer (CCB), 64% of respondents in the chemical industry expect their income to increase in 
the next 12 months. The strategy and operation mode of high growth enterprises provide three 
core levers that enterprises should use to achieve sustainable growth: innovation, pricing 
strategy and customer focus. We will explore each lever below and explore it further in the 
complete Ernst & Young report (PDF).
Frank Jenner, head of Ernst & Young's global chemical industry, said: "challenges are 
opportunities. In the current environment, these two opportunities are very rich for the chemical 
industry.""Rethinking your approach to numbers, sustainability, talent and culture can provide 
different advantages in the short and long term, and finally let you enter the next era of growth."
In order to focus on key growth levers in a balanced and integrated way, enterprises need to 
embed these levers into their strategy, culture and mentality. But they also need to realize that it 
takes time to achieve the highest benefits. One way is to determine what can be changed now, in 
the next three years or more.
Innovation in the chemical industry should not be limited to the development of new products. 
Chemical enterprises need to use the whole chemical ecosystem to develop new business 
models and discovery methods, open up new markets and improve innovation efficiency. 
Companies can innovate in products and new discovery methods, as well as in other areas.
Although enterprises are increasingly turning to data-driven innovation, they also need to focus 
on new applications and processes to maintain a strong innovation pipeline. For example, cross 
category innovation may include:
Application fields: new products with more extensive use cases, such as human tissue repair, 
energy storage, aerospace, future mobile, etc
Business model: close cooperation with customers, cross sales and channel integration; Multiple 
players join the platform business
Products and discovery methods: recyclability, green and other new chemistry, quantum 
chemistry, multi-scale nano materials, 4D printing materials, AI / ml material design and 
discovery
Process: process simulation; 3 D printing; Carbon emission reduction process; Converting carbon 
dioxide, coal and waste into chemicals; And the use of bio based raw materials
Companies should also consider their investment allocation. They can't miss the current trend, 
but at the same time, they need to be prepared for the upcoming general trend to innovate 
faster than their competitors. Internally, the management should promote an open and 
innovative culture and environment through a model of rapid testing, rapid failure and rapid 
reaffirmation.
Externally, they need to be flexible to work with various members of the ecosystem, from 
suppliers and technology partners to customer organizations and consumers. They should also 
seek new ideas from crowdfunding and cooperate with creative providers from concept to 
product scale.