The COVID-19 pandemic has forced companies to accelerate their digital transformation. Up to 74% of CEOs in the US say that the pandemic has accelerated progress in operational digitization and next-gen operating model by a matter of months or years. Bahtera’s own digital transformation began in 2019 before the pandemic, with the vision of a fully digitalized supply chain process for improved service quality, increased productivity, and more effective process.

Driven by the impact we’ve seen from growing technological disruption, we began to look inward into our own digital capabilities and requirements. What we found is that the chemical industry as a whole was lagging behind. While digital transformation has become the magic word for most enterprises, the chemical industry has been slower in embracing it. A 2016 survey shows that only 23% of chemical enterprises rate their digital maturity higher than average. 

There is no reason for this beyond hubris. The benefit of digital transformation translates beyond productivity and efficiency into business bottom line. Microsoft, Hasbro, and Best Buy – 3 companies that have invested in digital transformation for more than 5 years – show above 190% growth. To us, this shows that digital transformation is the inevitable future of a productive, effective, and efficient business. 

The pandemic has only further cemented this belief. Not just for us, but for other industry players. A 2020 survey shows that in the post-pandemic world, 66% of chemical industry executives expect digitalization-based revolutionary or disruptive changes in the next 3 years, while 90% agree that some change is already underway. Interestingly, the trend is even more prevalent in Asia Pacific with more than 59% chemical industry executives believing that digitalization will have revolutionary impact on their companies compared to 44% in Europe and only 34% in North America. 

Now that more businesses have caught up with the digital transformation train, the question is how do you do digital transformation right. Study shows that 70% of digital transformation fails to yield the expected outcome. The reason for this is that most businesses focus on the digital side instead of the transformation side. Meanwhile, digital transformation is just a means to business transformation, which means that it is always a dynamic process that involves the entire organization.

This is what we try to achieve through our own digital transformation. Rather than focusing on the digital transformation, we were looking at what was needed to improve our operation. The answer was a data-driven business improvement, an integrated operational process, and streamlined business process. This became the foundation of our digital transformation. Our goal is to establish a digital platform that integrates our entire business process from data generation and communication to transaction and monitoring. 

This starts with integrated digital data collection and analysis for more transparent and accurate data in real time to be used for more informed decision-making and planning. Such data integration will be applied across the entire business process from internal operation, market research, partner and principal cooperation, and business expansion, to client service. 

In its implementation, we take lessons from other companies’ digital transformation experiences. The failed digital transformation of many industry giants such as GE, Ford, and Procter & Gamble provides valuable lessons to be learned: prioritize quality over scale, translate the transformation to the entire organization, and don’t overlook external factors to business bottom line. 

Staying true to this spirit, we have broken down our digital transformation into several phases. Phase 1, which was completed by the end of 2020, saw the digitalization of our internal business process. Through the utilization of ERP, CRM, and a digital workspace, we streamlined and digitalized our entire internal process. The digital database and digital footprint provided by these systems are hoped to improve our accuracy and accountability as well as eliminate wasteful processes. 

The benefit of this first-stage digitalization measure was already felt when the pandemic forced us to shift to remote working. Although the transformation was yet to be completed early on in the pandemic, the adjustment was much easier with the preparations we had made. With a few adaptations, such as a shift in focus to remote working and accelerated digital workspace implementation, we were able to optimize all functions within the business process despite the many pandemic-related restrictions. 

Another focus at this stage was manpower development to ensure that our people not only are ready to adapt to the technology, but also fully understand the vision and mission behind this digital transformation. On this front, our vision is aligned with our overarching corporate mission to foster close partnership with partners and principals, supply chain efficiency, and quality maintenance. 

The effectiveness of this transformation will continue to be monitored based on a balanced scorecard we have prepared for the next 5 years. Meanwhile, we are moving forward with the next stage of our digital transformation, which focuses on translating such digitalization into our entire supply chain. This begins with a dashboard and recommendations for better decision making by our internal stakeholders, followed by communication and transaction platforms for our partners and the public. In the meantime, we are keeping a close watch on market, industry, and global developments and are prepared to make adjustments where needed. At the end of the day, all of these efforts are done for a more efficient and effective workflow, more satisfied customers, happier employees, and more profitable company and industry.