Chemicals

In the chemical industry, executives must often deal with strong interactions between competitors’ behaviors in highly competitive markets. New market entrants, often from Asia; important capacity decisions; sometimes large customers; and the availability of raw materials force companies to reconsider their competitive positioning. This challenge is complicated by the fact that when making decisions in any particular market, competitive reactions in related markets must be considered, both globally and in regard to neighboring products or possible substitutes.

We have been supporting executives in dealing with these special challenges of the chemical industry since 2008. Our quantitative approach to analyzing strategic interactions is particularly suited to these types of complex action-reaction patterns.

Chemicals Consulting Wargaming Interaction Disruptives

Aspects we have dealt with in the Chemicals industry

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Commoditization

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Asian market entry

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Backward integration

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Capacity utilization

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Product substitution

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Customer market power

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Competitor overreaction

N

Market spillover effects

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Large capacity investment

N

Co-manufacturing agreement

N

Maneuvering in a price war

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Using a competitor price shield

N

Handling a dominant competitor

N

Assessing a disruptive strategy

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Competitive pricing: dynamic strategy

N

Corporate alignment between divisions

N

Handling an aggressive competitor

N

Using swing capacity as advantage

N

Major asset sales and spin-offs

N

Pre-emptive capacity investment

N

Introduction of new production process

N

Locking in a market against competitors

N

Industry consolidation and restructuring

N

Responding to a competitor’s new product

N

Products /  Technology licensing agreement

N

Effects of competitor vertical integration

N

Disruptive technology impact and management

N

Determination of location for new site / investment

N

Strategic closing of plants / utilization management

N

New market entry, also from and into foreign industries

N

Assessment of market / competitive fitness of new technology

N

Evaluation of new technology introduction on competitive dynamics

N

Market consolidation and assessing prerequisites for industry recovery

N

Competitor acquisition: assesing the implications for competitive dynamics

N

Strategic alliances, joint ventures, and partnering: forming and ending them