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Digital Solution for Doubling Profits through Chemical Industry Cost Management – Introduction to the CMS Cost Optimization System. Precision Software Services (Ningbo) Co., Ltd., April 2021. Figure 1: CMS Cost Optimization System – Corporate-level cost management dashboard. I. Ongoing Challenges in Cost Management. As an important pillar industry of the national economy, the chemical industry is shifting from scale-based development to high-quality development. As one of the core aspects of enterprise management, cost management in chemical companies continues to face ongoing challenges from both internal and external sources. Externally, it faces pressures from continuous cost reduction, compliance requirements, and scarce resources. *Continuous cost reduction. The market for chemical products is highly competitive, and a company’s product costs are a fundamental requirement for participating in this competition. The ability to control costs and to continuously reduce them has a decisive impact on the survival and development of a company. *Compliance requirements. From ** to customers, there are increasingly stringent compliance requirements regarding energy and carbon emissions. If the requirements cannot be met over a certain period of time, severe consequences such as legal penalties, restrictions on project approvals, exclusion from the market, and loss of customers will arise. *Resources are scarce. Within a certain time and space, water, electricity, coal, oil, and gas can all become scarce. If the amount of available resources is not sufficient to meet the production needs of enterprises, it will affect the increase in their production capacity, leading to lower operation rates, load factors, and product delivery rates, as well as waste of corporate assets. Internally, it faces challenges such as complex control requirements, fluctuating performance, and difficulties in talent development. *There are countless variables that affect the cost of manufacturing complex chemical products. Issues at any one of the control points related to people, machinery, materials, methods, environment, or testing can have an impact on the product cost. Sometimes things seem to go wrong for no apparent reason, and then they seem to get better again; it’s possible that the workings of the device have not been fully understood at a fundamental level. *Performance fluctuations: The costs of chemical companies often experience fluctuations that go beyond normal levels. Devices that are basically designed and built in the same way can have different costs depending on the facility; costs vary across different production lines, as well as among different operating teams. There are also differences in costs associated with day shifts, night shifts, and different batches of products. Fluctuations in these performance metrics all result in losses due to deviations from the optimal standard costs. If these fluctuations can be effectively reduced, cost cuts can be achieved with little or no investment. *Cost management in chemical enterprises focused on talent development places high demands on the knowledge and skills of personnel in relevant positions. Talent training has a long training period and slow results. In production and operations, it is often necessary to have experienced craftsmen with many years of experience to ensure the best cost-performance results. There is an urgent need to use digital methods to capture the knowledge behind these optimal performance levels and incorporate it into the company, thereby accelerating talent development and fostering continuous improvements in cost performance. The aforementioned internal and external challenges place higher demands on the cost management of chemical companies, and excellent cost management is increasingly becoming a common goal for most outstanding chemical enterprises. II. Excellent cost management requires a digital cost management system. Based on best practices in cost management, it demands the coordination of four aspects: cultural philosophy, process systems, tools and methods, and system platforms. A digital cost management system platform that meets business needs can help achieve excellent cost management. However, at present, a large number of excellent chemical companies still lack professional and effective cost management system platforms. Some chemical companies possess some of the system functions required for cost management, but these functions are scattered across different management information systems, and there is little interoperability between them, resulting in several de facto information silos ； In some chemical companies, cost management is still carried out using paper and spreadsheets; the vast amount of cost-related data is not properly digitized, which makes statistical analysis time-consuming and difficult. As a result, it is impossible to respond quickly to customers, let alone conduct in-depth analysis of cost-related big data in order to harness the value contained within that data for improving the company’s cost management. Excellent cost management urgently requires a digital cost management system that meets the actual needs of chemical enterprises! III. A better choice – The 3 key advantages of the refined cost management system CMS. In line with the requirements for excellent cost management, the refined cost management system CMS has ushered in a new era of digital cost management systems, boasting 3 core advantages: professional expertise, advanced technology, and best practices. 1. As a digital system that is currently scarce in the market, it was developed firsthand by former client-side users who are now on the vendor side. Based on the best practices of excellent cost management in the chemical industry, as well as expertise in cost management within this sector, the system is designed to meet specific customer needs. It includes a variety of functions tailored to the actual requirements of chemical enterprises, covering three areas of management: costs, energy, and carbon emissions. It addresses the management needs at various levels such as the headquarters group, production sites, companies, facilities, and teams, as well as across different time scales ranging from long-term to daily, hourly, and even second-by-second. By encompassing all aspects of cost management, it achieves integration of these functions. The fact that those who developed the system have both business knowledge and technical expertise ensures that it is practical and relevant to real-world applications. 2. The advanced technology system integrates mainstream cutting-edge technologies such as the Industrial Internet of Things, artificial intelligence, and big data. It employs a next-generation software architecture, and through techniques like modular design, bus integration, separation of front-end and back-end components, and load balancing, it ensures that the software is robust, reliable, and easy to use. Through the rule mining in cost management processes, the system employs various algorithmic models such as periodic rules, conditional rules, and custom rules to enable intelligent planning, intelligent decision-making, intelligent forecasting, and intelligent alerts, thereby achieving intelligence in cost management. The system enables multi-platform collaboration through computer terminals, Android explosion-proof mobile phones/tablets, and large-screen devices, and utilizes smart tags to allow unified cost management of all key elements such as people, machinery, materials, methods, environment, and testing processes with just one code. The system enables effective integration of business processes across various areas of cost management ； It can also be integrated organically with other application systems such as ERP (Enterprise Resource Planning systems), MES (Manufacturing Execution Systems), PLM (Product Lifecycle Management Systems), LIMS (Laboratory Information Management Systems), and OA (Office Automation Systems), thereby eliminating information silos at the source. 3. The best practice system integrates the best cost management practices of industry leaders. Xia Lan, the key person in charge of this system, has worked at Wanhua Chemical for 17 years. She was part of Wanhua Chemical’s first group of employees trained for excellence in overseas operations, and she acquired over 10 years of experience in cost management through roles such as lean cost management manager. Her expertise covers various aspects including the development of cost management systems, the training of cost management professionals, and the creation of digital platforms for cost management. The energy cost management initiatives she led have won multiple awards at ** level. IV. Introduction to the Functions of the Refined Cost Management System CMS. The Refined Cost Management System CMS consists of 6 major categories, 15 subsystems, and 40 functional modules. It covers three main areas of management: cost management, energy management, and carbon emission management. Users can choose to use all or some of these functional modules as needed, and additional modules can be provided to meet specific user requirements. Table 1: List of functions of the Refined Cost Management System. Figure 2: User interface of the Refined Cost Management System CMS. V. Three key benefits of using the Refined Cost Management System CMS: cost reduction, compliance, and improved efficiency. By utilizing the Refined Cost Management System CMS, users can achieve excellent cost management and reap three key benefits: cost reduction, compliance, and improved efficiency. *Cost reduction – Significantly cut costs and increase corporate profits. Optimizing the use of the Cost Management System (CMS) enables cost control and reduction; every dollar saved translates directly into profits for the company. By continuously striving for excellence in cost management, businesses can accelerate their progress on the path to higher profits! *Compliance – Ensuring that businesses meet the requirements related to energy management and carbon emissions. Optimizing the use of the Cost Management System CMS enables full compliance with laws and regulations concerning energy management and carbon emissions, as well as with customer audit requirements, across all stages including policy and regulation identification and collection, transformation and implementation, corrective actions, data analysis, and report preparation. Make every enterprise an advanced model corporate citizen that meets **requirements, fulfills societal expectations, and satisfies customer needs, thereby driving continuous improvement in the company’s reputation. *Improving efficiency – By leveraging digitalization and intelligence, the efficiency of a company’s cost management processes can be enhanced. The use of a cost management system CMS allows for the creation of a digital platform specific to the company, enabling intelligent cost management. Over time, as this system is used, knowledge and expertise related to cost management can be accumulated, which in turn helps to train employees better. All staff members can acquire the knowledge, skills, and competencies necessary for effective cost management in their respective roles. Through the overall improvement of employees’ capabilities, and with the support of digital systems, companies can achieve efficient and comprehensive cost management, achieving excellent results with minimal effort. Refined Cost Management CMS – A digital solution for excellent cost management, ensuring doubled profits! VI. Regarding the refinement software