Hexion, a global producer of adhesives and performance materials solutions, is entering a new era as a solutions-focused partner combining deep industry experience, AI-powered systems and proprietary algorithms to help customers improve efficiency, reduce waste and create more sustainable, profitable operations.
What is Chemistry-as-a-Service™, and how is AI helping realize this vision?
Chemistry-as-a-Service™ is about shifting the role chemistry plays inside wood panel manufacturing. Historically, chemical companies sold relatively static products into a defined operating process. Mills managed uncertainty by building buffers into the system: using extra resin, slowing line speeds and widening operating windows. Those decisions create what we think of as a “stability tax” across the manufacturing process. As technologies advance, we believe materials must become part of a more intelligent operating system.
Most manufacturing systems already generate enormous amounts of data, but very little of it is used to actively guide operating decisions in real time. Today, we are focused on helping customers connect material science, process engineering, automation and operational data into one integrated system that can recognize patterns, manage variability and support faster decisions while production is still running. AI also creates the opportunity to manage system variability dynamically instead of relying on conservative operating buffers and reactive adjustments. We are already seeing mills reduce resin usage by more than 10% while improving consistency and throughput. Quality variation can narrow by 30% or more, while throughput gains in the range of 3% to 8% become achievable without major capital investment. We think this new approach to adaptive materials will fundamentally reshape how the chemical industry operates over the next decade, and Hexion intends to help lead that transition.
Hexion has recently made several strategic moves, from the Smartech acquisition to the CitroTech joint venture. How do partnerships and acquisitions help accelerate your strategy?
Partnerships and acquisitions are a critical part of how we believe this industry will evolve over the next decade. The challenges facing industrial manufacturing today are too interconnected for any one company to solve alone. Delivering the next generation of manufacturing will require chemistry, automation, AI, sustainability and process engineering to work together much more closely than they traditionally have. Hexion’s acquisition of Smartech is a good example. Smartech brings advanced industrial AI, machine learning and process optimization capabilities that help manufacturers operate with greater precision and real-time visibility. Combining those capabilities with Hexion’s chemistry and manufacturing expertise accelerated our ability to build more intelligent operating systems for our customers. The CitroTech joint venture reflects a similar philosophy, combining market-leading fire-retardant chemistry with Hexion’s manufacturing scale and technical expertise to help redefine how fire protection is integrated into wood products.
Is AI-driven data analysis and system optimization helping innovate new materials, or are applications mostly about optimizing what is already out there?
It is both, and I think that distinction is important. Right now, especially in more mature industrial sectors like chemical manufacturing, most companies are using AI to optimize existing systems: improving throughput, reducing waste and tightening quality variation. There is still a tremendous amount of opportunity there, because many manufacturing environments remain highly reactive and operationally conservative. But as we think about where this goes next at Hexion, the bigger opportunity is what happens when AI starts influencing material design itself. Historically, wood resins were developed to perform across a broad range of operating conditions because manufacturers had limited visibility into what was happening dynamically inside the process. That required resin formulations that are designed around broad tolerances and relatively static operating assumptions. AI does not change the chemistry itself, but it gives us the potential to understand process conditions, variability and performance relationships at a much deeper level than was previously possible.
Instead of static resin formulations designed to perform the same way across every environment, you can begin moving toward more adaptive systems where chemistry, process conditions, and operational data continuously inform one another in real time. In practical terms, that means the manufacturing line itself can help determine what type of resin is needed based on factors like wood species, moisture levels, ambient conditions and how the mill is operating that day. That information can then feed into production of the next resin batch, allowing formulations to become increasingly tailored to the actual conditions of each production run instead of relying on a one-size-fits-all approach.
When achieving that “golden batch” of perfect production, is there a hurdle in convincing people to trust the algorithm over decades of experience and intuition?
We are not looking to replace operators or create fully autonomous plants. In chemical manufacturing especially, operator experience remains incredibly important. The best operators understand things about a process that are difficult to capture in a spreadsheet or standard operating procedure. What AI does is help scale and strengthen their expertise.
The goal is to give operators better visibility, earlier warning signals and more confidence in complex environments where decisions often happen very quickly. In many cases, automation also improves safety and quality of life by reducing constant firefighting, unnecessary overtime and reactive decision making. Over time, I think the best manufacturing environments will combine deep operational experience with AI-enabled systems that help people operate more consistently, safely and effectively.
Hexion’s focus on sustainability relies on disruption of traditional revenue models, but what is the profitability in lower product sales?
Sustainability is embedded in how we think about innovation at Hexion, but we also believe it requires a different business model mindset. Historically, chemical companies generated value by selling more material into the system. But AI and process intelligence are starting to show that manufacturers can often achieve better outcomes with fewer raw material inputs if the overall manufacturing process is operating more intelligently. For customers, that can create significant economic value. They not only use less resin, but they are also using less wood, consuming less energy, reducing waste, improving throughput and operating more consistently. Across a large manufacturing system, those gains can translate into millions of dollars of operational improvement.
For Hexion, that changes how we think about value creation as well. We increasingly see the opportunity not just in product volume, but in helping customers improve overall system performance through smarter formulations, process optimization and integrated technologies. As manufacturing becomes more intelligent and connected, we believe the companies creating the most value will be the ones helping customers develop and maintain better systems, not simply sell more material into them.
Any other remarks about the future outlook for Hexion and its specializations?
I believe we are entering one of the most important periods of change the industrial world has seen in decades. AI, automation, material science and real-time data are starting to converge in ways that have the potential to fundamentally reshape manufacturing. This can absolutely feel disruptive or even uncomfortable at times, especially in mature industries that have operated a certain way for generations.
At Hexion, we want to help lead that transition. We believe chemistry will continue to play a critical role in the future, but increasingly it will be connected with AI, process intelligence and advanced manufacturing systems. We are not just watching industrial transformation happen around us. We are actively helping shape where it goes next.
