6 Operational Challenges in the Chemical Industry (and How You Can Solve Them with Software)

April 19th 2022 11:00:00 AM

The chemical industry is a type of business that has specific rules and regulations to follow. Along with doing what is necessary to stay profitable, it must remain compliant and collect data along the manufacturing process. With so many steps involved, keeping all the data organized and up to date manually would be very challenging. The right software can help your authorized users stay up to date on where your products are in the manufacturing process and keep customers satisfied. 

6 Operational Challenges in the Chemical Industry

1. Compliance

Chemical companies have to deal with multiple rules and regulations to remain compliant. Depending on the products your company produces, you may be subject to guidelines by one or more of the following agencies:

• Environmental Protection Agency (EPA)
• Food and Drug Administration (FDA)
• Good Manufacturing Practices (GMP)
• Occupational Safety and Health Administration

Suppose you export products to the European Union. In that case, you may also be subject to REACH (Registration, Evaluation, Authorization and Restriction of Chemicals) guidelines. 

2. Hazard Analysis

Information needs to be gathered at several points during the manufacturing process, from supplier purchase orders to production to finished products. The hazard analysis information is required to comply with the EPA and other agencies and track the chemical industry’s carbon footprint. 

Manufacturers can track the processes they use that produce waste, scrap, and byproducts. With this information in hand, executives can work with the EPA to remain compliant. 

Chemical companies can also optimize their resources by shifting resource-intensive work to off-hours. This move will save on energy costs.

3. Lack of Inventory Visibility

Chemical company employees need to know where to find inventory in real-time. Some companies have multiple warehouses, which complicates keeping up with inventory use. They need to be able to monitor and track inventory in numerous categories, such as:

• Container for bulk products in their final receptacle (bag, drum, pallet, railcar)
• Disposition (tracks whether a product can be used for sale or isn’t usable)
• Grade
• Lot number
• Serial numbers
• Shelf life

Software that can store these elements for each product makes tracking inventory much more streamlined for a chemical company. Users will need to search for components and completed items in several measurements.

4. Formula Management

Chemical companies must rely on formulas to track their material usage and maintain detailed records to ensure their final products are consistent. Formula management includes:

• Tracking multiple measurements
• Integrating formulas with inventory
• Ordering supplies
• Scaling production to meet demand

The right software will assist you with formula management. It will allow you to track your formulas with your production schedules and supply chain. You will also be able to include your cost distributions, including substituting higher or lower-cost chemicals to achieve the same results. 

5. Quality Control

Quality control is a vital part of the work done in the chemical industry. Companies need to ensure the quality and safety of their products. Quality control occurs at several steps in the manufacturing process, from incoming materials to tracking standing inventory to checking batches of the finished product. The company must also be ready to respond quickly to a recall to locate and remove all the batches of affected materials from its facility. 

During formulation, chemical companies conduct research and development (R&D) to build the best formulas while keeping costs down. Their formulas need to be constantly improved, which means R&D is an ongoing process. Chemical companies require the right tools to track and compare the result of their research, changes to formulas, and their results. 

6. Scrapping or Reworking a Batch

Finding out that a batch doesn’t meet regulatory compliance or control standards is a very frustrating situation. It means the batch must be scrapped or reworked. 

• Scrapping a batch is the least attractive option, since the company must absorb the costs of manufacturing the batch for no financial gain.
• Reworking the batch means combining the original costs (overhead, materials, and labor) with the additional charges (overhead, materials, and labor) of making the required adjustments to meet quality standards.
• Reblending may work if the company can label the product as using off-spec materials. The finished product will need to be marked accordingly, and the pricing will need to reflect its status.

In each instance, you’ll want to be able to track all the variables involved before making a decision. Software makes it much easier to input numbers to give you a complete picture and weigh your options.

Scanco OPS for Sage Intacct: Customizable, Robust Tracking Tool 

Scanco OPS is a powerful software solution that has been designed for use with Sage Intacct. With Scanco OPS for Sage Intacct, you can track anything in one system:

• Finished Goods
• Materials
• Inventory

This software also allows you to customize fields for your specific needs. You can add dates, units of measurement, formulas, steps, lot and serial numbers, and batch numbers. The software allows you to create any fields necessary to keep your company running smoothly. 

Scanco OPS for Sage Intacct is flexible enough to allow you to attach documents. You can keep the latest versions of all regulatory requirements in one location. Your team will not waste time looking for this critical information or, more importantly, get caught relying on out-of-date regulations. 

This solution allows you to eliminate data entry. Automating this process reduces the risk of errors and makes the information available in real-time. 

Scanco OPS for Sage Intacct is cloud-based, which means you can run it on any browser you are using for Sage Intacct. 

Suppose you are working in the chemical industry and are dealing with any of the operational challenges listed above. In that case, Scanco OPS for Sage Intacct can help your business track anything and become more efficient. Contact us online or call (330) 645-9959 to make an appointment with a Scanco Solutions Expert to learn more today.