As SAP cel­e­brates its 50^th anniver­sary, also com­mem­o­rat­ing 50 years of part­ner­ship with the chem­i­cals indus­try, Matt Rey­mann remains focused on the future. 

As Glob­al VP of the Chem­i­cal Indus­try Busi­ness Unit (IBU) at SAP, Rey­mann rep­re­sents chem­i­cals at SAP while sup­port­ing strate­gic ini­tia­tives to move the indus­try for­ward, such as the adop­tion of dig­i­tal tech­nol­o­gy to inform busi­ness transformation. 

At this year’s ASUG Best Prac­tices: SAP for Chem­i­cals event (held Nov. 8 – 9, vir­tu­al­ly), Rey­mann wel­comed atten­dees and deliv­ered an open­ing keynote ses­sion, which focused on the strate­gic direc­tion of chem­i­cals and the grow­ing impor­tance of evo­lu­tion and inno­va­tion to one of the world’s most essen­tial industries. 

ASUG recent­ly inter­viewed Rey­mann to pre­view the ses­sion. This is an edit­ed ver­sion of the full conversation.

Ques­tion: Your keynote ses­sion for the ASUG-SAP Chem­i­cals con­fer­ence is ​“The Future of Inno­va­tion: How Chem­i­cal Com­pa­nies Are Fight­ing for the Future!” Why was that the right title for this session?

Answer: Before we talk about the future, let’s reflect on his­to­ry. The first SAP cus­tomer, in 1972, was Impe­r­i­al Chem­i­cal Indus­tries (ICI), a chem­i­cal client. Now, 99 out of the top 100 chem­i­cal cus­tomers run SAP. It’s part of our DNA, and it’s an indus­try that’s evolving. 

The chem­istry busi­ness touch­es 96% of all man­u­fac­tured goods: your phone, your car, your clothes, your shoes, clean water, food pack­ag­ing, and more. Chem­i­cals were even used in the pro­duc­tion of vac­cines. If you think about the world becom­ing health­i­er, peo­ple becom­ing more pro­duc­tive, and soci­ety becom­ing sus­tain­able, the chem­i­cals indus­try is the source of that. 

So, when we talk about fight­ing for the future, we’re talk­ing about an indus­try SAP has been sup­port­ing for 50 years, and com­pa­nies that have been around for over 100 years that have to keep redefin­ing them­selves. I start­ed my career at DuPont, which orig­i­nal­ly made gun­pow­der; when I start­ed work­ing there in 2012, they were mak­ing tita­ni­um diox­ide (TiO2) and had a crop pro­tec­tion busi­ness unit and per­for­mance pack­ag­ing. Ten years lat­er, DuPont has an entire­ly dif­fer­ent port­fo­lio. TiO2 became Chemours; DuPont had the Dow merg­er and split, crop pro­tec­tion sold to FMC Corp, and the mate­ri­als divi­sion sold to Celanese Corp. 

This indus­try is con­tin­u­ous­ly evolv­ing to bet­ter serve soci­ety, and there’s a pur­pose-dri­ven men­tal­i­ty in the indus­try. The real­i­ty is chem­istry can solve some of the world’s biggest chal­lenges, and the indus­try is ral­ly­ing around that. How can we bet­ter serve our cus­tomers and ulti­mate­ly bet­ter serve soci­ety? We’re all here togeth­er, look­ing at how dig­i­tal can be an enabler of an essen­tial indus­try for mod­ern-day life.

Q: What trends, chal­lenges, and oppor­tu­ni­ties do you plan to address?

A: There’s an ener­gy cri­sis, intense geopo­lit­i­cal activ­i­ty, demand and sup­ply volatil­i­ty, com­modi­ti­za­tion in the mar­ket, and a need to dri­ve prof­itabil­i­ty and growth. I look at some of these macro­eco­nom­ic trends to deter­mine what’s top of mind for cus­tomers; I ask cus­tomers what’s keep­ing their boards awake at night, and they say busi­ness trans­for­ma­tion, sup­ply chain resilience, and sus­tain­abil­i­ty are top of mind.

More is being asked from our dig­i­tal lead­ers; there’s a high­er expec­ta­tion that they’re busi­ness experts, dig­i­tal experts, sus­tain­abil­i­ty experts, and cyber experts. They must have a holis­tic view because dig­i­tal is an an enabler of busi­ness strat­e­gy, helps deal with dis­rup­tion, and helps iden­ti­fy new busi­ness mod­els and growth oppor­tu­ni­ties. How can these lead­ers dri­ve prof­itabil­i­ty of an orga­ni­za­tion? It comes down to hav­ing the right com­bi­na­tion of peo­ple, process­es, and tech­nol­o­gy as well as the right access to data. 

Dig­i­ti­za­tion is not nec­es­sar­i­ly new to the indus­try, but I’ll break down a view on what busi­ness trans­for­ma­tion looks like, focus­ing on pro­duc­tiv­i­ty and agili­ty, look­ing at new busi­ness mod­els, and ulti­mate­ly enabling busi­ness strategy. 

With the Amer­i­can Chem­istry Coun­cil, I shared a view of numer­ous top­ics, includ­ing prof­itabil­i­ty, sus­tain­abil­i­ty, and resilience. One ele­ment of sup­ply chain resilience is that it works in the con­struct of a busi­ness net­work. Again, the chem­istry busi­ness touch­es 96% of all man­u­fac­tur­ing goods, so if you look at the inter­con­nect­ed­ness of these val­ue chains, how do you address demand sup­ply volatil­i­ty or a cir­cu­lar econ­o­my? You must work in the con­struct of a val­ue chain. You can’t just be look­ing in a chem­i­cals silo. You need to under­stand what’s hap­pen­ing to your cus­tomers and your cus­tomers’ cus­tomers, whether that’s the auto­mo­tive val­ue chain, con­sumer prod­ucts, or indus­tri­al applications. 

From a dig­i­tal per­spec­tive, get­ting to stan­dard is crit­i­cal. The first SAP cus­tomer was in chem­i­cals; we have a deep foot­print, but this left us with lega­cy sys­tems and very cus­tomized process­es. As we move to the cloud, where inno­va­tion is accel­er­at­ing, how do you con­sume new capa­bil­i­ties? You have to get to stan­dard, sim­pli­fied, and har­mo­nized process­es, such as AI/ML capa­bil­i­ties, ana­lyt­ics, and main­te­nance. This is what we’re deliv­er­ing now, so it will be one of the strate­gic levers as com­pa­nies dig­i­tal­ly trans­form: get to stan­dard, become agile, and con­sume new tech­nol­o­gy more quickly. 

Q: You men­tioned the cir­cu­lar econ­o­my and that con­cept is cru­cial to embed­ding sus­tain­abil­i­ty with­in var­i­ous indus­tries. What have you observed of the chem­i­cals industry’s progress in terms of sustainability?

A: The empha­sis is still on com­pli­ance and report­ing. That’s top of mind around emis­sions. With the expec­ta­tion that require­ments ramp up in 2024, com­pa­nies are look­ing to make sure they have the right data and process­es to report.

Some com­pa­nies are look­ing more strate­gi­cal­ly at sus­tain­abil­i­ty. East­man Chem­i­cals, a $10 bil­lion com­pa­ny out of Ten­nessee, is mak­ing huge invest­ments in mol­e­c­u­lar recy­cling. East­man is using Green­To­ken by SAP to sup­port mass bal­ance and track­ing as they’re deal­ing with com­min­gled mate­ri­als, and they’re look­ing strate­gi­cal­ly at embed­ding sus­tain­abil­i­ty in how they go to market. 

Solvay is invest­ing heav­i­ly in sus­tain­abil­i­ty strat­e­gy; Dr. Ilham Kadri, their CEO, has stat­ed that cus­tomers who ignore sus­tain­abil­i­ty will have their ​“Kodak moment” and be obso­lete. She has also stat­ed that chem­i­cal lead­ers must have ​“one eye on the tele­scope, one eye on the micro­scope,” which to me is that same con­cept around being both prof­itable and sus­tain­able. If you look at the 17 Sus­tain­able Devel­op­ment Goals (estab­lished by the Unit­ed Nations in 2015), like hav­ing access to clean water or sus­tain­able food sources, the indus­try is sup­port­ing all 17 SDGs and look­ing to SAP to sup­port the under­ly­ing data and process­es need­ed to man­age that. 

If you look at our strat­e­gy around sus­tain­abil­i­ty, it’s com­plex, and there are a num­ber of stan­dards being devel­oped. Sus­tain­abil­i­ty is a jour­ney, not a des­ti­na­tion. The strat­e­gy is around meet­ing glob­al com­pli­ance reg­u­la­tions. In the keynote, I’ll reflect on look­ing at core busi­ness process­es, be it logis­tics or man­u­fac­tur­ing, and ask­ing how your deci­sion-mak­ing in these areas can impact your busi­ness. We sup­port the under­ly­ing data and process­es to man­age that, so that if you’re mak­ing logis­tics or man­u­fac­tur­ing deci­sions, you can under­stand the impact that those deci­sions may have on emis­sions or circularity. 

We see sus­tain­abil­i­ty dri­ving deci­sion-mak­ing, and we’re mov­ing toward new busi­ness mod­els. If you have a new prod­uct, how can you design it and reduce CO2 emis­sions? How can you intro­duce new grades into your port­fo­lio? SAP can be a part of that; we want to enable that evo­lu­tion. We speak to cus­tomers who are increas­ing their port­fo­lio of renew­able prod­ucts and ask­ing how they can embed that into the process­es of SAP.

Q: What oth­er major take­aways do you want atten­dees to have?

A: There should be a sense of urgency. This indus­try has his­tor­i­cal­ly been a lit­tle slow-mov­ing. Technology’s mov­ing fast and strate­giz­ing for years is an eter­ni­ty in tech­nol­o­gy. Where can you get start­ed on this jour­ney, be it with sus­tain­abil­i­ty, sup­ply chain resilience, or net­work? SAP rep­re­sents col­lab­o­ra­tion with the indus­try; we’re about being close­ly aligned to cus­tomers, under­stand­ing what the cur­rent require­ments are, and know­ing what future trends of the indus­try are. We want to do as much lis­ten­ing as we are shar­ing infor­ma­tion. The source of our val­ue has to reflect what’s top of mind for our cus­tomers. I’ll try to paint a pic­ture around both busi­ness trans­for­ma­tion and indus­try collaboration.