B2B INTEGRATION IN THE CHEMICAL INDUSTRY

B2B INTEGRATION IN THE CHEMICAL INDUSTRY Balancing customer responsi iveness and internal standardization over the past 10 years and in the future Daniela Huber, Wacker Chemie AG and Simon Hardy, Elemica 29 September 2011 CREATING TOMORROW'S SOLUTIONS

AGENDA WACKER Company Profile 2002 - Early days of E-Business at WAC CKER 2007 - Customers demand more flexibility How Elemica keeps pace with their clients requests 2011 - Going beyond real connectivity The future Daniela Huber, Wacker Chemie AG and Simon Hardy, Elemica, 29 September 2011, Slide 1

PRODUCTS AND SOLUTIONS FOR KEY GLOBAL SECTORS WACKER is a technology leader in the chemical and semiconductor industries. We forge ahead with technical innovations and the development of new products for the world s key industries. We offer solutions and innovations for a broad range of sectors. Automotive & transport Construct tion Energy, electronics Coatings & Adhesives Elastomers, plastics Life science Paper, films & NIP Photovoltaics Textiles, leather & fibers Semiconductors Consumer care etc. Daniela Huber, Wacker Chemie AG and Simon Hardy, Elemica, 29 September 2011, Slide 2

OVER 90 YEARS OF SUCCESS Wacker Chemie AG Foundedd in 1914 by Dr. Alexander Wacker Headquartered in Munich WACKER Group (2010) Sales: 4.75 billion EBITDA: 1.2 billion R&D: 165 million Investments: 695 million Employees: 16,314 Daniela Huber, Wacker Chemie AG and Simon Hardy, Elemica, 29 September 2011, Slide 3

TECHNICAL AND WACKER ACADEMY CENTERS: GLOBALLY PRESENT AND CLOSE TO CUSTOMERS Moscow Nünchritz Adrian Allentown Freiberg Suwon Burghausen Akeno Beijing Portland Hikari Dubai Kolkata Shanghai Shunde Mumbai Hsinchu Singapore Jandira Melbourne Global coverage via worldwide network Local support for our customers Ideal platform for advanced training and industryspecific networking Technical Centers Technical Center with Promotion of innovations and know-how transfer Daniela Huber, Wacker Chemie AG and Simon Hardy, Elemica, 29 September 2011, Slide 4

IN 2002 WACKER OFFERS TWO DIFFERENT E-BUSINESS CHANNELS CUSTOMER STRUCTURE many different industries customer size varies from small businesses to big multi national groups various business processes different levels of e-procurement capabilities STRATEGIC APPROACH Offer two e-business channels depending on customer s size and ability: Classic web-shop for every customer that is willing to use it INTERNAL REQUIREMENTS standard processes one global solution low efforts for maintenance Process integration for multi-national chemical companies and distributors Daniela Huber, Wacker Chemie AG and Simon Hardy, Elemica, 29 September 2011, Slide 6

WACKER JOINS ELEMICA BECAUSE OF THE CONNECT ONCE CONNECTED TO ALL APPROACH vs. 1:1 connectivity Connected once connected to all WACKER becomes Elemica Member in 2002 Daniela Huber, Wacker Chemie AG and Simon Hardy, Elemica, 29 September 2011, Slide 7

EFFICIENT CUSTOMER ROLL-OUT WITHIN THE FIRST YEARS Elemica offers two basic connectivity models depending on customer s IT infrastr ructure All ChemXML messages for the order- to-cash process are implemented: order, order response, order change, ASN, invoice Only one interface and messaging standard to maintain at WACKER Easy on-boarding of new partners Elemica business rules form the basis for standard processes Daniela Huber, Wacker Chemie AG and Simon Hardy, Elemica, 29 September 2011, Slide 8

CASE STUDY USING ELEMICA WITH DISTRIBUTORS The system saves time and reduces complexity and errors. Cindy Bader, Brenntag Great Lakes, Materials Management Group Brenntag is Wacker s largest distributor in the Americas In the US three WACKER locations deliver materials to 7 Brenntag regions All order transactions were automated Daniela Huber, Wacker Chemie AG and Simon Hardy, Elemica, 29 September 2011, Slide 9

IN 2007 THE ELEMICA CONNECTIVITY MODELS ARE NOT SUFFICIENT TO FULFILL CUSTOMER NEEDS Messaging Standards used by Germany s Top 100 EDI companies Inhouse 18% Others 45% XML 29% VDA 61% EDIFACT 85% STATUS OF PROCESS INTEGRATION AT WACKER Connections with all major Elemica members and distributors established Focus on customers outside the chemical industry EDIFACT is still the predominant messaging standard Switch to ChemXML and becoming Elemica member does not add value for many customers Target to expand Elemica connections to Japan Source: Cross Automation Champion 2006 Daniela Huber, Wacker Chemie AG and Simon Hardy, Elemica, 29 September 2011, Slide 11

ELEMICA OFFERS A SOLUTION TO COMBINE PROCESSES FROM THE AUTOMOTIVE AND THE CHEMICAL INDUSTRY AUTOMOTIVE INDUSTRY CHEMICAL INDUSTRY new order regular delivery forecast messages order change Replenishment Solu ution Daniela Huber, Wacker Chemie AG and Simon Hardy, Elemica, 29 September 2011, Slide 12

WACKER JAPAN SETS A TARGET OF 50% E-BUSINESS Situation in Japan Solution Result Akeno Limited number of customers High amount of order lines Short lead times Quick order entry and fast feedback to customers is crucial Elemica Buyer Direct Does not equire advanced IT infrastructure at the customer Direct feedb back to the customer that the order was transmitted Order response e- mail with details high acceptance at the customer because of Elemica s local support quick onboarding of the first customers 50% share of orders via Elemica was reached at the beginning of 2011 Daniela Huber, Wacker Chemie AG and Simon Hardy, Elemica, 29 September 2011, Slide 13

WITHIN SHORT TIME ELEMICA OFFERS THE RIGHT CONNECTIVITY OPTION FOR EVERY CUSTOMER Chemical Industry Automotive Industry Construction Industry Tire&Rubber Industry Japanese customers Elemica connectivity / Elemica Buyer direct Replenishment solution EDI connectivity Connection via another HUB Elemica Buyer direct with local support in Asia only one external interface must be maintained at WACKER only one message format must be supported SAP processes do not need to be changed Daniela Huber, Wacker Chemie AG and Simon Hardy, Elemica, 29 September 2011, Slide 14

ABOUT ELEMICA Founded by the chemical and tyre and rubber industries Greater than $70 Billion of transactions handled annually through Elemica Solutions Global presence with offices in Atlanta, Amsterdam, Frankfurt, London, Seoul, Shanghai, Singapore, and Tokyo. Global Headquarters in Exton, Pennsylvania. More than 3,000 companies connected through the QuickLink network supporting a wide range of industries Daniela Huber, Wacker Chemie AG and Simon Hardy, Elemica, 29 September 2011, Slide 16

ELEMICA S PRODUCT PORTFOLIO: QUICKER AND SMARTER Process Integration requirements are met with Elemica's SmartLink Supply Chain Solutions Data Integration requirements are met with Elemica s QuickLink Network We harmonize both Process and Data Integration Daniela Huber, Wacker Chemie AG and Simon Hardy, Elemica, 29 September 2011, Slide 17

SMARTLINK PRODUCT SUITES: PROCESS INTEGRATION For customer service and sales organizations. The Customer Management Suite will: Improve day to day supply chain service & reliability Increase the perfect order "percentage lower the cost of errors Increase asset utilization Reduce customer invoice errors enabling you to get paid sooner Daniela Huber, Wacker Chemie AG and Simon Hardy, Elemica, 29 September 2011, Slide 18

SMARTLINK PRODUCT SUITES: PROCESS INTEGRATION Customer Management Products Include: Sales Order Management Invoice Management Vendor Managed Inventory Delivery Forecast Repeat Order Entry Rail Car Fulfillment Certificate of Analysis (CoA) Daniela Huber, Wacker Chemie AG and Simon Hardy, Elemica, 29 September 2011, Slide 19

QUICKLINK CONNECTIVITY: FOR ALL SUPPLY CHAIN PARTNERS QuickLink ERP QuickLink ERP Buyers of: - Raw Materials - Logistics Services - MRO products Sellers: - Chemical Companies - Service Providers - Equipment Sellers QuickLink Email and QuickLink Print QuickLink Portal Daniela Huber, Wacker Chemie AG and Simon Hardy, Elemica, 29 September 2011, Slide 20

QUICK LINK E-MAIL IS CLOSING THE GAP BETWEEN WEBSHOP AND PROCESS INTEGRATION WACKER INTERN NET WEBSHOP GAP ELEMICA QUICKLINK E-MAIL ELEMICA INTEGRATED ORDER PROCESSING Daniela Huber, Wacker Chemie AG and Simon Hardy, Elemica, 29 September 2011, Slide 22

QUICK LINK ROLL-OUT PROJECT AT WACKER 30 customers connected in the first 6 months (Europe and US) with the QuickL Link E-Mail solution Quick and efficient roll-out support from Elemica Almost no changes in the customer s ordering process needed Customers are only involved at a very late stage during testing First mapping for orders with Chinese characters was completed successfully Daniela Huber, Wacker Chemie AG and Simon Hardy, Elemica, 29 September 2011, Slide 23

THE FUTURE Coming together is a beginning; keeping together is progress; working together is success. (Henry Ford) Daniela Huber, Wacker Chemie AG and Simon Hardy, Elemica, 29 September 2011, Slide 25

QUESTIONS? Simon Hardy Key Account Director Elemica E-mail: shardy@elemica.com Daniela Huber E-Business Manager Wacker Chemie AG E-mail: daniela.huber@wacker.com Daniela Huber, Wacker Chemie AG and Simon Hardy, Elemica, 29 September 2011, Slide 26

THANK YOU FOR YOUR ATTENTION. Daniela Huber, Wacker Chemie AG and Simon Hardy, Elemica, 29 September 2011, Slide 27