SPEECH BY Mr S Iswaran, MINISTER, PRIME MINISTER’S OFFICE & SECOND MINISTER FOR HOME AFFAIRS AND TRADE & INDUSTRY, AT THE OPENING OF THE BOSTON CONSULTING GROUP CENTER FOR BUSINESS EXCELLENCE, TUESDAY, 30 OCTOBER 2012, 0920HRS, RAFFLES HOTEL
Dr. Hans-Paul Bürkner, Chief Executive Officer and President of The Boston Consulting Group,
Mr. Jeffrey Chua, Managing Director and Head of The Boston Consulting Group Singapore,
Distinguished Guests,
Ladies and Gentlemen,
Good Morning.
Introduction
I would like to extend my heartiest congratulations to The Boston Consulting Group (BCG) on the opening of your first Center for Business Excellence. I am pleased that BCG has chosen to locate the Center in Singapore.
Companies need to be “in Asia for Asia”
The launch of the BCG Centre for Business Excellence is timely, given the compelling economic prospects for Asia. Despite a global climate of uncertainty, China and India remain key growth engines. In Southeast Asia, the ASEAN economies such as Indonesia, Malaysia, Thailand and Vietnam are expected to continue their growth trajectories.
It is also apparent that Asia’s growth story is shifting to the next phase. It is no longer being driven by just low input costs in the region. A new dynamic – the rise of Asia’s domestic markets – is now in play. According to an OECD study, Asia’s middle class will account for 66 percent of the global middle class population, and reach nearly 60 per cent of total global consumption by 2030. Growing urbanisation, infrastructural development, and increasing consumer demand will create new opportunities in the region. In turn, this has led many companies to shift their economic focus to Asia and invest resources to grow their Asian operations.
Unlocking the market potential in Asia is not without its challenges. Asia is a complex region, with 48 different countries and more than 1,400 different languages. To effectively tap Asia as a market, businesses cannot simply repackage solutions that were conceived in and developed for Western markets. Instead, companies need to be in Asia to understand the Asian consumer and customise differentiated strategies that cater to the Asian context. Being “in Asia, for Asia” will enable companies to respond with agility to the developments in these fast growing markets. Companies can then more effectively target customers distributed across a heterogeneous profile.
Singapore is the ideal location for companies to access the opportunities in Asia
Singapore is well-positioned to be the Global-Asia hub and a springboard for companies venturing into and beyond Asia. We have world-renowned business infrastructure, good connectivity, as well as strong business and cultural links to many Asian markets. Many companies have chosen Singapore as the base from which to orchestrate a wide range of regional control functions to access opportunities in Asia and beyond. These activities include supply chain management, procurement, finance, IT and HR, and increasingly, strategic functions such as brand management activities.
For instance, Unilever has made Singapore the control tower for its Asia, Africa, Central and Eastern European operations. It has also established its Four Acres global leadership development centre in Singapore to train future leaders, right in the heart of Asia, and prepare them to champion the company’s strategic growth in Asia. We also see other companies who have chosen to base their global decision making functions in Singapore, including GlaxoSmithKline, Tata Communications and Panasonic.
Singapore is also the ideal location for the pan-Asian consumer insights hub
We are encouraged by the confidence of major companies, including BCG, which have chosen to locate their key business activities here. Singapore is a pan-Asian hub, where companies can acquire a nuanced understanding of Asian markets, in order to create products that address the sensibilities and preferences of Asian consumers. Singapore is also one of the top choices among global talents for international assignments. These factors have enabled Singapore to emerge as the connecting hub where global businesses converge to generate new insights and ideas, and translate them into growth opportunities.
Today, Singapore has a vibrant array of companies and institutes focusing on Asian consumer insights. The BCG Center for Business Excellence is an important addition to this ecosystem. The Center will centralise BCG’s efforts to develop and aggregate new knowledge and tools for its various consulting practices in Asia and in the world. It will comprise a Knowledge Hub focusing on selected industry topics such as industries and economies, as well as an Enablement Centre which will focus on talent and leadership issues. The upcoming Asia Strategy Institute will also help companies develop or streamline their business strategies catered to the Asian context.
The Center joins other key research institutes here in Singapore, with the likes of the Milken Institute’s Asian Centre, the Institute on Asian Consumer Insight at NTU, the NUS Global-Asia Institute, and the ASEAN+3 Macroeconomic Research Office. This growing presence of knowledge centres in Singapore creates a supporting infrastructure that companies can leverage to gain first-hand insights into Asia. It also reinforces Singapore’s position as a Global-Asia hub; one that connects Asia to the world, and the world to Asia.
Conclusion
In conclusion, I would like to take this opportunity to thank BCG for its continued confidence in Singapore. I wish the Center every success in its future operations, and look forward to a long and fruitful partnership between BCG and Singapore. Thank you.