Logichem 2009 - Interview with Tim Bett

The global economic downturn has hit the chemical industry and it is essential that supply chains adapt quickly to the changed circumstances. From Mar. 31st to Apr. 2nd Logichem 2009 - the 8th annual European supply chain conference - takes place in Dusseldorf, Germany. More than 200 senior logistics and supply chain executives from bulk and specialty chemical manufacturers come together to share experiences, make new contacts and discuss latest developments. CHEManager Europe asked Tim Bett, former Supply Chain Director at DSM, and member of the Logichem 2009 Advisory Board, about this year's event and trends in the field of chemical supply chain management.

Questions:

1. How important is supply chain management for the chemical industry in times like these? How does managing the supply chain more efficiently help companies survive the economic turmoil?

Efficient and flexible supply chain management is essential if chemical manufacturers are to continue to supply reliably and cost-effectively. Fundamental to this is a robust Sales and Operations Planning process (S&OP) to ensure that demand and supply are aligned, thereby minimising the need to tie up Working Capital in inventory.

2. What are the main challenges that interfere with effective supply chain management in times of a turbulent economy?

We need to be flexible and quick to anticipate and then respond to reducing and/or downgrading of demand, as well as highly volatile energy, freight and raw material costs! Operating in a planned environment is key as it is far less effective solely to respond to events.

3. What grade of maturity do you think supply chain management has reached in our industry? Can the chemical industry learn from other industry sectors?

I think it is dangerous to generalise because there is wide variation both in the chemical industry and other sectors. However, there is no doubt that those businesses that have good visibility/control from raw material through to final customer, as a result of integrated processes, can adapt to changing circumstances much quicker than the laggards.

And yes, rather than just importing specific techniques from other sectors, we could benefit greatly from a deeper understanding of how the more-demanding BtoC world approaches supply chain management and the KPIs they are required to meet.

4. Do you see new supply chain strategies that will have significant impact on the way chemical companies source or distribute their products?

Now is not the right time to make radical changes to supply chain strategies. I am doubtful even that the majority of companies should be striving for “best practice.” As long as the supply chain fundamentals are in place, now is more a time for “fit for purpose”, improving the efficiency of what you have and making sure you prioritise.

5. How will LogiChem 2009 address these issues? What benefits can attendees draw from their participation?

Over the years, Logichem has developed its own, strong culture. It is a highly interactive conference where most of the supply chain leaders from the chemical industry come together and share experiences - both good and bad. There is a strong spirit of camaraderie and of collaboration. There is plenty to learn on all facets of supply chain management from the people who live with these issues. This year, the Focus Day on Demand Planning is particularly relevant – if you do not understand the demand-side, you will forever be fighting fires!

Tim Bett is now Director Europe for Bisham Consulting, specialists in Logistics and Supply Chain Management - website: www.bishamconsulting.com Tim has previously been Supply Chain Director for DSM and Logistics Director Europe for Rohm and Haas. He is based in the Netherlands. Email: timbett@bishamconsulting.com