Lecture notes

IT in Chemical Industry

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Information Technology (IT) in Chemical Industry

Lecturer: Dr Petar Varbanov
CPI2, FIT, University of Pannonia
varbanov@cpi.uni-pannonia.hu

TableofContents
1.Introduction........................................................................................................................................2
2.ApplicationsinchemicalindustrytackledbyIT...............................................................................3
2.1.Businessaspects.........................................................................................................................4
2.1.1.eCommerce:enhancingintercompanyproductivity.........................................................4
2.1.2.AdaptiveBusinessNetworks(ABN):optimisingbusinesscollaborations.........................7
2.2.Productandprocessdesign......................................................................................................10
2.2.1.Processdesign...................................................................................................................10
2.2.2.ProductDesign.................................................................................................................12
3.ITsolutionsusedforindustry..........................................................................................................14
3.1.eCommerceandbusinesscommunication................................................................................14
3.2.Generalcomputationsoftware.................................................................................................14
3.3.Processsimulators....................................................................................................................15
3.4.Toolsforoptimalsynthesis.......................................................................................................16
3.5.Toolsforoptimalscheduling....................................................................................................16
4.Otherliterature.................................................................................................................................17

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1. Introduction
Information Technology (IT) is applied vastly throughout various industries around the
world. The current document focuses mainly on chemical industry, but the discussed
principles are generally valid for a wider range of enterprises.
The function of IT in modern society, and industry in particular, is in managing information
by collecting, storing, transforming, retrieving and supplying vast amounts of critical data. It
helps decision makers in every step of the industrial activity life cycle.
It is important to realise that IT cannot be considered on its own, in isolation from the other
tools employed in any application domain, especially in industry. In fact, IT has already
been integrated with:
Business strategies including the design and operation of vast business alliances
and marketplaces;
Operational decision making in production;
Modelling of chemical processes and systems for the purposes of efficient operation
and system design;
etc.
This lecture is structured as follows. First, a selection of IT applications in chemical
industry, currently receiving much attention, are discussed (Section 2). In Section 3, a
review of a number of usful software tools applied in industry and process optimisation is
given.

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2. ApplicationsinchemicalindustrytackledbyIT
The compilation of an exhaustive list of IT applications tackled in chemical industry is
almost impossible. However, a small list to illustrate some essential applications sample
can be as follows.:
(1) eBusiness / eCommerce, Adaptive Business Networks
(2) Computational Chemistry
(3) Total Enterprise Management, Supply Chain Management
(4) Knowledge Management
(5) Process design flowsheet synthesis, equipment design, sizing of equipment in a
flowsheet, etc.
(6) Process operation resource planning, long-term and short-term production
scheduling, process control and automation.
(7) Process monitoring, risk estimation and disaster warning
Each of these applications has its own specifics. Each of them may need computation,
communication / data exchange and content management and manipulation, or a
combination of those, as illustrated in Figure 1. All these application areas reflect the three
major industrial needs which Information Technology is poised to satisfy:
Complexity management in modelling and everyday operation
Management of enormous amounts of data by regulating data streams and data
storage
Analysis of the data and generation of useful information
These requirements are all geared towards a single goal: increasing the competitiveness
of the companies and respectively their profits, by improved overall company
management and efficient decision making.

Applications
Computational
Chemistry

Supply Chain
Management

Operation
types

Process
design

Risk
estimation

Computation

Process
operation

Enterprise
Management

Process
monitoring

Communication
Data exchange

eCommerce

Disaster
warning

Adaptive
Business
Networks

Content management
and manipulation

Knowledge
Management

Applications
Figure1.IndustrialITapplicationsandbasicoperationtypes

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2.1. Businessaspects
The tools which can be used for condicting the everyday business vary from one company
to another. Possible components of such systems include Microsoft BizTalk server, the
products of SAP AG and in-house developed XML web services. This section discusses
the main comcepts of conducting business by chemical industries.

2.1.1. eCommerce:enhancingintercompanyproductivity
e-Commerce is a relatively new way of conducting business. Its main applications
nowadays are in areas such as retail of books, airline tickets and travel/holiday
reservations. Therefore, the full extent of its current impact on the chemical industry
cannot be felt yet. In order to fully exploit the potential of this technology It needs to
become pervasive by offering proper interfaces ans user-friendly solutions.
Definition: [Oxford English Dictionary] pervasive (adjective) spreading widely through
something; widespread

What does this paradigm mean to chemical industry? A quick look at the IT developments
at Dow Chemicals (eBusiness@Dow, 2007) in the past half century sheds some light on
the issue. The trend is illustrated in Figure 1. In the first IT applications during the 1960s
and 70s the automation and streamlining of the operations within individual production
plants was pursued. Later on, during the 1980s the focus was shifted to optimising the
operation of entire industrial sites and in the 1990s the scope was further extended to
enterprise-wide level. One can easily see that each of these development stages was
strengthening the company efficiency and agility, simultaneously paving the way for the
following stage. According to Dow (eBusiness@Dow, 2007), each of these changes has
also brought significant productivity gains to the respective sites and the company.

Enterprise

1990s

1980s

1960s
1970s

Optimise the
enterprise
operation

Optimise the operation

of entire sites

Streamline and automate plant

operation (individual plants)

Figure2.FocusoftheITdevelopmentsintheDowChemicalscompanyinthepast50years
The next logical step in the IT development at Dow is the expansion to the area of e-

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commerce (eBusiness@Dow, 2007), with which they expect to boost inter-company

productivity and optimise the way the whole industry operates.
What are, in fact, the benefits that e-commerce brings? There can be at least three:
Connecting with customers better and faster via online hubs such as Elemica
(www.elemica.com) and other Internet tools.
Improving the way the industry works by introducing and employing standardised
technologies for data exchange and communication. One example of this is the
introduction of the CIDX Chem eStandards, discussed below.
Making better decisions through sharing information and knowledge. It is common
sense that good decisions are the informed decisions. Therefore, employing data
warehousing, knowledge management and e-learning

Enterprise

1990s

Enterprise
level

e-Commerce
1980s

1960s
1970s

Optimise the operation

of entire sites

World-wide
Streamline and automate plant
operation (individual plants)

Figure3.DowChemicalsvisionforITexpansion
All of the enumerated ways of exploiting e-Commerce by industry would be impossible
without suitable standards and tools for communication of the necessary data and
information. This is where the the Chem eStandards kick in. These are the e-Business
standards developed specifically for the buying, selling and delivery of chemical products.
They are based on the eXtensible Mark-Up Language (XML), the globally-recognized
"gold standard" for electronic data exchange. These standards are developed and
maintained by the Chemical Industry Data Exchange (CIDX, www.cidx.org) non-profit
organization. CIDX is a membership-based organization serving the chemical industry,
focused on the development of eBusiness standards, called Chem eStandards, which
have become the de facto standards for transacting business electronically in the industry.
Chem eStandards provides XML schemas to describe a number of business transactions
that support and enable various general business processing models for the chemical
industry. Specifically, the Chem eStandards document describes data interchange
standards in the following functional areas:
1. Customer/Company Information
2. Product Catalogs/RFQ (Request For Quote)
3. Purchase Orders
4. Logistics

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5. Financials
6. Forecasting
7. Exchange Interactions (information exchange)
8. Product Information
9. Credit Upon Proof of Sale (CUPS)
10. Reporting
Detailed information about the standards, including freely available downloads of various
editions of the standards, documentation, XML schemas, protocol specifications and
examples of their use can be found from the CIDX site www.cidx.org. To give a flavour of
the type of documents exchanged by using the Chem eStandards, Figure 4 shows the
general structure of an electronic (XML) invoice document. Further, Figure 5 shows the
invoice header and body sections.

Figure4.ChemeStandardsXMLInvoicegeneralstructure

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(a)Invoiceheader

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(b)Invoicebody

Figure5.ChemeStandardsXMLInvoicecontentdetails

2.1.2. Adaptive Business Networks (ABN): optimising business

collaborations
An adaptive business network is a network of companies, collaborating in some set of
related market segments. The network focus is on the customer needs and on achieving
agile response, preferably in real time, to changes in the state of the network and the
external environment. ABN is not a single given software product to install. It rather
represents a set of business strategies aimed at improving the overall economic efficiency
and profitability of the involved enterprises.
There are two main parts of this paradigm aiming at commecrial viability and success. An
ABN is both a network-type system and an adaptive system. For a set of enterprises is
makes more economic sense to focus on their strengths and perform the activities they
can do best and delegate the rest to business partners.
More specifically, ABNs are designed with the following properties:
Agile and demand-driven (aiming at real-time responses)
Collaborative
Efficient
Extensive use of interfaces and leveraging standards
Adaptive (built for change and friendly to innovation)

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Agility is achieved by closely monitoring market demands and implementing intelligent

response mechanisms, so that the signals flow to every company in the network, triggering
the relevant responses minimising the disruptions and ensuring smooth changes to
product and material flows. This gives rise to a sort of a feeback control scheme (Figure
6). As a result, the network also becomes demand-driven.

Business Goals
Network Parameters

ABN
Products
Services

Sales
Customers

Demands

Detect
Respond
& Adapt

Demand-driven
Real-time
Built for change
Figure6.ControlschemeforABNagilerealtimeresponse
Efficiency is achieved by the mentioned focus by the network members on their core
competences (Figure 7) - i.e. the activities they do best, and delegating the rest of the
activities, which are withing the core competences of other network members or even
outside partners. This is often referred to as outsourcing.

Interfaces

ABN

Perform what can best.

Outsource the rest.
Partner

Partner

e-Commerce
Partner

Partner

Outsourcing

e-Commerce

Partner

Outsourcing

Technology

Technology

Partner

Collaboration

Partner

Partner

Leverage standards

Figure7.CollaborationandefficiencyfactorsforABN
One of the means of realising the outlined distribution of activities and outsourcing (Figure
7) is through establishing and maintaining collaboration links between various enterprises.
Depending on the degree of collaboration, any given two collaborating partners may be
considered as belonging to the same business network or not. As a result, the business

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network becomes collaborative with partners exchanging material and information flows.
There are two modes of participation in an adaptive business network: coordinator and
partner. While most companies will be partners, many firms will find themselves playing
both roles.
The implementation of all these concepts heavily employs Information Technology. For
instance, all information flows between the partners within the network as well as with
external customers and suppliers requires extensive communication, as already discussed
in section 2.1.1 e-Commerce: enhancing inter-company productivity above. All
communication and transactions are rendered using XML-based communication protocols
and web services. This leads to another important feature of ABNs the use of interfaces
and leveraging of standards. This is a very important feature, since developing unified
software to serve all possible business actors is inefficient and bulky venture, to which not
many potential partners would subscribe. Therefore, by agreeing upon a set of clear open
standards for intra- and inter-corporate communication as well as commercial transactions,
industrial companies create a productive framework where each one can use a software
implementation of their choice while preserving the benefits of prompt communications
and e-commerce.
Finaly, besides responding to market changes in real time, ABNs need also to support
longer-term tactical and strategic, evolution of its members, organisational structure and
algorithms for the sort-term responses. This is an excellent avenue for applying knowledge
management systems. including artificial intelligence techniques. This, of course, needs to
be further supplemented by appropriate research and development of various models of
unit chemical processes, customer behaviour and forecasts of future market conditions.
These needs stipulate that ABNs are built for change and friendly to innovation.
What ABNs mean to the chemical industry? Depending on its position in the respective
supply chain, a chemical enterprise may need to manage either an extensive downstream
network (i.e. towards customers), an upstream one (towards suppliers) or both. The
chemical industry sector comprises companies with different relative positions in the
supply chains. There are companies closer to the raw materials origination. These produce
mainlt bulk chemicals, or base chemicals to be used by other manufacturers. Some of the
benefits of employing the ABN paradigm, IT and Communications (ICT, or Information &
Communication Technologies) are listed below:
Decreasing processing costs. Chemical industry is characterised by a large
number of transactions, many of them of significant value. Therefore, even
fractional improvements in these processes can aggregate to quite substantial
savings. This is especially true for the basic chemicals industry, where its major
potential to increase profit margins lies in the reduction of internal costs, because of
the small profit margins.
Speeding up information flows. The benefit here comes from the accelerated
information generation and delivery. Depending on the activity, this can be research
and development or trials of various products and processes, or the speed of
reaction to customer enquiries and orders, especially the speed of fulfilling the
orders.
Improving information about the market: e-Commerce. Using the e-Commerce
tools besides speeding up the transactions, also brings about more continuous and
smooth sales, also decreasing the need for personnel conducting routine tasks.
Extending the market. Using Internet and e-Commerce on large e-marketplaces
(e.g. Elemica, www.elemica.com) increases the company visibility to partners and

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customers.
Source: SAP AG
PERFECTING THE RECIPE FORCOMPETITIVE ADVANTAGE: THE CHEMICAL
INDUSTRY AND ADAPTIVE BUSINESS NETWORKS
ADAPTIVE BUSINESS NETWORKS: A STRATEGY FOR MASTERING CHANGE AND
EFFICIENCY IN MANUFACTURING

Books on ABN
Claus Heinrich, RFID and Beyond: Growing Your Business Through Real World Awareness
(John Wiley & Sons, Inc., 2005) , ISBN 0764583352.
Claus Heinrich, Adapt or Die: Transforming Your Supply Chain into an Adaptive Business
Network (John Wiley & Sons, Inc., 2005) , ISBN: 978-0-471-26543-6 (paper), ISBN: 978-0471-35211-2 (Adobe E-Book).

2.2. Productandprocessdesign
Other avenues for extensive application of IT are product and process design. At the end
of the day, both involve the identification of goals, generation of suitable alternatives
satisfying these goals and finally selecting the best alternative. These activities require
evaluation and comparison of usually enormous amounts of discrete options and also
feature a number of continuous relationships reflecting performance characteristics. This
defines then the corresponding Mixed Integer-Nonlinear optimisation problems. Moreover,
very often the execution of these activities is not strictly sequential and a number of
iterations may be necessary.

2.2.1. Processdesign
The design of processes for manufacturing a specified set of chemical products is called
Chemical Process Design. For given products this activity involves
Process synthesis (1): selection of raw materials and potential chemical and/or
physical processing steps via which to obtain the desired products.
Process synthesis (2): selection of unit operations to carry iut the identified
processing steps
Process synthesis (3): arranging the unit operations in an integrated flowsheet
(flowsheet construction) in order to achieve maximum efficiency, profit and minimise
resource consumption most notably to minimise energy requirements
Final design: appropriately sizing the units
Layout: arranging the operating units physically

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Figure8.Generalprocedureforprocessdesign
Depending on the specific implementation the outlined stages may vary and iteration is
needed. One possible arrangement is shown in Figure 8. During the flowsheet
construction and later stages of process design, process simulation is often used to
evaluate the performance of the processes. These and other software tools are discussed
later.
Major issues in process design, which allow bringing down the overall process costs, are:

Minimisation of the consumption of any primary resources and raw materials

per unit product. Most notably it is desired to minimise the use of energy and water.
This is necessitated mainly by the high energy and resource prices and the fact that
often these costs take significant shares in the overall expenses.

Minimisation of the emissions of various chemicals and heat into the

environment. This is dictated by the need for preserving and improving the
environmental conditions and the quality of life. One specifically grave issue
becomes the release of greenhouse gases and CO2 in particular.

Minimisation of the capital costs of the process. In many cases this is the
dominating cost item. This was the case until recently, while the energy prices used
to be relatively low. Currently, the rising oil prices shift the significance towards the
operating (mostly) costs.

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Books on Process Design

Robin M. Smith, Chemical Process Design and Integration (Wiley, 2005) , ISBN 0471486817.
Warren D. Seider, J.D. Seader, Daniel R. Lewin, Product and Process Design Principles:
Synthesis, Analysis, and Evaluation (Hardcover), (John Wiley & Sons, Inc., 2004) , ISBN:
0471216631.

2.2.2. ProductDesign
Product design problelms are formulated and solved in order to find aswers to questions
such as:
Which current products are in need of replacing?
What new products need to be developed
Applied to chemicals, the procedure is known as Chemical Product Design. It involves
definition or discovery of certain needs either internal or those of customers, generation
of options (chemical products) capable of satisfying those needs and then screening and
selecting the best options. For this purpose, the Chemical Product Design problem is
usually formulated as one of mathematical optimisation.
The overall procedure is sketched in Figure 9. As can be seen, an important feature of the
algorithm is that it usually requires reiteration and repeating all or part of the steps.
Example goals of Chemical Product Design can be:
Finding a chemical product which exhibits certain desirable or specified behaviour
Finding an additive which when added to another product improves its properties
and/or performance.
Regarding methods, usually a number of potential products are formulated by chemistry
experts and an optimisation tool is used to evaluate their performance and choose the best
options. Selecting more than one final product may be desirable. Most commonly this can
be caused by very close performance of certain chemical products or the presence of the
company in more than one market segment e.g. one segment for a premium product
(i.e. high performance high price) and another lower segment (low performance low
price).
The options selection usually proceeds with determining the feasibilty of each product and
then evaluating its performance according to the formulated goals. The feasibility
assessment involves evaluation of various constraints such as whether the chemical in
question satisfies the requirements for health and safety, permitted impact on the
environment and possibility to manufacture.
The latter assessment, in fact, requires that a process for the manufacturing of that
product be designed.

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Figure9.Generalprocedureforproductdesign
Books on Product Design
E. L. Cussler, G. D. Moggridge, Chemical Product Design (Cambridge University Press,
2001) , ISBN 0521796334.
Warren D. Seider, J.D. Seader, Daniel R. Lewin, Product and Process Design Principles:
Synthesis, Analysis, and Evaluation (Hardcover), (John Wiley & Sons, Inc., 2004) , ISBN:
0471216631.

Academic papers on Product Design

R. Gani, (2004), Chemical product design: challenges and opportunities, Computers and
Chemical Engineering, 28:24412457.

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3. ITsolutionsusedforindustry
There exist a number of tools for performing process modelling simulation and
optimisation. Both activities are important for implementing process and product design, as
well as improving the performance of existing running chemical processes. Also, the
ecommerce and networking activities are performed using software from different vendors,
the most famous being SAP AG. Some tools popular in industry and academia are briefly
outlined below.

3.1. eCommerceandbusinesscommunication
There are two big players in this field and these are SAP AG and Microsoft. The former is
the vendor of a suite of tools for corporate management and e-commerce.
SAP provide software products for Enterprise Resource Planning (ERP). The company's
main product is SAP ERP.
see http://www.sap.com/solutions/business-suite/erp/index.epx
SAP ERP is the one of five major applications within the company's overall package. The
four other applications are:

Customer Relationship Management (CRM)

Product Lifecycle Management (PLM)

Supply Chain Management (SCM)

Supplier Relationship Management (SRM)

More information can be found on the company's web site http://www.sap.com.

Microsoft's BizTalk (http://www.microsoft.com/biztalk/default.mspx) is another major
product on the market. This is is a business process management (BPM) server. It is often
referred to as simply "BizTalk". Through the use of "adapters" which are tailored to
communicate with different software systems used in a large enterprise, it enables
companies to automate and integrate business processes. Offered by Microsoft, it
provides the following functions: Business Process Automation, Business Process
Modeling, Business-to-business Communication, Enterprise Application Integration and
Message broker.

3.2. Generalcomputationsoftware
For general computation activities such as simple process modelling, chart plotting, and
implementing customised models for the mainstream process simulators and optimisers, a
number of products can be used, such as:

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Matlab (offered by Mathworks Inc., www.mathworks.com)

Mathcad (offered by Mathsoft Engineering & Education recently acquired by

Parametric Technology Corporation ), see its web site:
http://www.ptc.com/appserver/mkt/products/home.jsp?k=3901

MS-Excel (part of the MS-Office suite),

http://office.microsoft.com/en-us/default.aspx

OpenOffice.org Calc (part of the Sun's open source office suite),

www.openoffice.org

It is necessary to note that especially Matlab has become very popular within the
engineering community and is also used to perform large-scale and complex modelling
tasks, including process optimisation. Another industry success is the use of MS-Excel for
online recording of industrial plant data supplied by the measurement equipment.

3.3. Processsimulators
There are also many process simulators on the market, most popular of which are ASPEN
Plus (Aspen Technology, Inc. , www.aspentech.com), HYSYS (initially developed by
Hyprotech Ltd, currently part of Aspen Technology, Inc.), ChemCad (by Chemstations, Inc.,
http://www.chemstations.net) and gPROMS (by Process Systems Enterprise Ltd.,
http://www.psenterprise.com). All these are commercial, proprietary products, developed
and maintained by well established companies usually combining software products with
engineering consultancy services.
In the sea of tools available, it is also possible to find one, named ASCEND, which is an
open-source project (under GNU General Public License). It is developed and distributed
by a team of scientists from the Chemical Engineering Department at the Carnegie Mellon
University, led by Professor Art Westerberg.
The project home page is: http://ascend.cheme.cmu.edu/
This is a flexible process modelling environment suitable for both process simulation and
optimisation. It offers:
An object-oriented model description language for describing your system
An interactive user interface that allows you to solve your model and explore the
effect of changing the model parameters
A scripting environment that allows you to automate your more complex
simulation problems.
Figure 10 shows an example screenshot from a converged simulation of ASCEND, taken
from the tool tutorial. The picture illustrates two major points the object-oriented nature of
the ASCEND models and the clear user interface. In addition, the tool provides also other
aids to modellers, such as an incidence matrix. The latter is a very useful debugging tool
when complex models consisiting of hundreds or thousands of equations, enormously
improving the modeller's productivity.

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Figure10.ScreenshotsfromaconvergedsimulationinASCEND

3.4. Toolsforoptimalsynthesis
Currently, for optimal synthesis of process flowsheets, a number of different tols exist, with
none yet providing a complete standalone functionality. Some popular software
applications include
PNS (general process synthesis using P-graph (www.p-graph.com), developed by
the Department of Computer Science, University of Pannonia (www.dcs.unipannon.hu)
SPRINT - Heat Exchanger Network Synthesis, developed by the Centre for Process
Integration, The University of Manchester
Many researchers also use GAMS (GAMS Development Corporation, www.gams.com)
and other general modelling/optimisation tools to perform process synthesis and design.

3.5. Toolsforoptimalscheduling
For optimal process scheduling, two major paradigms can be used: S-graph (www.sgraph.com), and Mathematical Programming (GAMS).

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4. Otherliterature
Bibliography
eBusiness@Dow,2007:Kepler,D.,E.,RedefiningBusinessProcessintheChemicalIndustry,2007,
http://www.dow.com/ebusiness/news/ebspeech.htm