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INTERNAL

Internal

Next Generation Business

Architecture – Embracing the

Digital Age at BASF

2018, October 17 – Prague

Wiebe van der Horst

Agenda

1. About BASF

2. Digitalization at BASF

3. Technology challenges & blueprint

4. Next Generation Business Architecture

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BASF – We create chemistry

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◼ Our chemistry is used in almost all industries

◼ We combine economic success, social responsibility and

environmental protection

◼ Sales 2017: €64,457 million

◼ EBIT 2017: €8,522 million

◼ Employees (as of December 31, 2017):

115,490

◼ 6 Verbund sites and 347 other production sites

BASF’s segments

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Oil & GasAgricultural

Solutions

Functional

Materials & Solutions

Performance

ProductsChemicals

▪ Petrochemicals

▪ Monomers

▪ Intermediates

▪ Dispersions &

Pigments

▪ Care

Chemicals

▪ Nutrition &

Health

▪ Performance

Chemicals

▪ Catalysts

▪ Construction

Chemicals

▪ Coatings

▪ Performance Materials

▪ Agricultural

Solutions

▪ Oil and Gas

Agenda

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1. About BASF

2. Digitalization at BASF

3. Technology challenges & blueprint

4. Next Generation Business Architecture

Digitalization - What‘s in for the chemical industry?

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R&D

- Scientific digital simulation & modelling

- Supercomputer for increased processing capabilities

Supply Chain

- Prescriptive support in decision making

- End-to-end value chain integration

Digital Business Models

- Lean start-up development based on design thinking

- Example: cosmetics formulation platform

Engineering & Maintenance

- Digital Plant and digital twin → predictive maintenance

- Information provisioning via Augmented Reality

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Agenda

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1. About BASF

2. Digitalization at BASF

3. Technology challenges & blueprint

4. Next Generation Business Architecture

Technology Ambition

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Example for usage scenario

Key pre-requisite

Close connectivity of components in real time

Industry

4.0

Technology Ambition

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© Motorola

Technology Challenge

Industry

4.0

The foundation for BASF‘s digital core has

been designed in the early 90s

The

“Internet” is born

© US Roboitics

© IBM

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Integration &

organization

How do they do it? Learn from the best…

Alphabet

The customer is always first,

but…

- great digital visions require

digital excellence to become valuable

- an outstanding and flexible

user experience requires…

a. a backend to cope with

real time

b. mechanisms to extract

valuable insights out of data assets (e.g. AI)

Integration &

organization

Amazon

Technology Ambition

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3 cornerstones build the

foundation of our new architecture

Industry

4.0

Integration & organization

user

experience

modern backend smart data

Agenda

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1. About BASF

2. Digitalisation at BASF

3. Technology challenges & blueprint

4. Next Generation Business Architecture

The evolution of the ERP architecture at BASF points towards a

modular architecture

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Next Generation

Business Architecture

One globally

consolidated

system

(Cobalt)

1990 - 2000

2000 - 2008

2008 - 2014 Differentiated

applicationsE.g. on agile platforms

like SAP Cloud Platform,

Amazon Web Services

Commodity

servicesE.g. travel management,

text processing tool

ERP*

Core

System and

processes per

region

One system per

legal entity

2015 – 202x

*Enterprise Resource Planning

A standardized ERP Core will be the basis of a modular and agile

architecture

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Data Integration LayerLinking of data across all levels

Monolithic ERP Core• Far off standard• Inflexible

• High-maintenance

Today: monolithic In future: modular & agile

SAP satellite

systems

Commodity services• Plug & Play• Software-as-a-Service

Differentiated applications• Agile development• Customized

• Platform-as-a-Service

Reduced ERP Core• Efficient & Fast• Close to standard

Phase 2:

Core Conversion

The transformation of our architecture will take place in

4 key steps

Phase 4: Satellite Transformation

Phase 1:

Preparation of Conversion

Kick Off Soft freeze Deep freeze Go live Post go live

Phase 3 waves

Phase 4 waves

Preparation projects

Go/no-go

decision

Phase 3: Process Adaptions

Design Development Testing cycles Post go live

Core conversionPreparation

IPE design

Soft freeze Deep freeze

Preparation satellite projects

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Summary: we intend to maximize the value of digitalization for BASF

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• Enable better decisions by increased transparency & AI → e.g. supply chain, finance

• Improve R&D and time to market with digital intelligence

Get out more value of our data

assets

• Provide real time information where required

• Attractive interaction with IT systems where needed→ e.g. app, speech, augmented reality

Provide right information at the right

time

• Increase speed, service & quality for existing business areas

• Explore new market opportunities with new capabilities (e.g. AI or IoT)

Improve market

performance

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