Speech by Mr Lim Hng Kiang, Minister for Trade and Industry at the Local Enterprise and Association Development (LEAD) Forum, “LEADing through Innovation” on Wednesday, 15 May 2013, 9.00 am at Raffles Town Club
Good morning, ladies and gentlemen,
It is my pleasure to join all of you at the 8th Local Enterprise and Association Development Forum, or the LEAD Forum. I am very happy to see so many leaders of our various industry sectors and trade associations here this morning.
Need for industry transformation
2 As you all know, today's Forum comes at a time when our businesses are facing increasing pressures from rising costs, land and labour constraints, as well as a more competitive global market. Clearly, it can no longer be business as usual. Companies have to restructure if you want to achieve productivity-driven, quality growth.
3 The Government clearly recognizes this, and we also know this will not be easy. We will therefore continue to support companies in their restructuring journey. We will invest in the future through education, infrastructure and R&D. We will also expand your economic space to create opportunities both locally and globally.
4 In this restructuring journey, our Trade Associations and Chambers (TACs) will play a very key role, especially in championing the interests of their members, and spearheading changes at the industry level to ensure businesses remain competitive amid this very challenging times.
TACs have evolved to address the changing needs of the industry
5 The role of spearheading change is not new for many of the TACs present here today. Over the past decade, industries, such as furniture manufacturing or textile and garment manufacturing, have transformed themselves successfully from lower-value manufacturing to higher-value, design-led activities. These businesses recognised the need to re-invent themselves very early on, in order to stay ahead in the global market. This was partly due to the work of forward-thinking TACs, such as the Singapore Furniture Industries Council and the Textile and Fashion Federation. They were able to recognise the global industry trends early, and they helped shape their members to respond to changes.
6 There is therefore an increasingly urgent need for companies to transform and to improve productivity. As such, many TACs have also begun to champion industry-wide productivity improvements and capability-building for their industries. Let me highlight a few examples.
7 The first example is the Singapore Innovation & Productivity Institute (SiPi). It was set up by the Singapore Manufacturing Federation (SMF) to drive innovation and productivity, in order to grow the manufacturing sector sustainably. Since its inception in early 2012, the institute has helped 20 companies attain manufacturing excellence through one-stop solutions. These include sharing of best practices and execution methodologies, project coaching, and technology liaisons with industry partners as well as Centres of Innovation. This is a good start for SiPi towards assisting the manufacturing companies to enhance their capability in innovation and productivity. Going forward, SiPi will be conducting a benchmark study of Singapore’s productivity indices and market research on the best practices in productivity.
8 Another example of an industry-wide improvement is AstorTime, a system that improves productivity and helps to address manpower shortages through automated manpower optimisation and tracking. This initiative was introduced by the Association of Singapore Marine Industries (ASMI). To date, some 33 SMEs in this sector have used the system. We hope that by introducing the system to the smaller shipyards and their contractors, this will encourage a higher take-up rate to benefit the entire sector. ASMI also started its own training institute to standardise training for the marine industry, indirectly increasing productivity. Since its launch, this institute has trained and certified around 4,000 industry personnel at all levels.
9 Some of our TACs have also been very active in leading their members on the internationalisation front. This is crucial for our SMEs, as the domestic market is relatively small. WasteMET Asia, an initiative by the Waste Management and Recycling Association of Singapore, is a good example of how TACs can help position Singapore businesses in the international arena. The Association worked with the National Environment Agency (NEA) last year to introduce WasteMet Asia. This is a one-stop event for innovative waste management solutions, and it seeks to promote Singapore as the waste management hub for Asia. As I understand, WasteMet Asia exhibitors generated more than S$115 million worth of business leads during the event last year. Following last year’s success, a second edition of the event will be held next year, featuring new show segments, such as eco-products and waste tracking technologies.
10 All the initiatives that I mentioned earlier were supported by the LEAD programme. The LEAD programme has, to date, supported a total of 29 TACs for 43projects. We will continue to support projects from the TACs to deepen industry capabilities in upgrading, productivity and internationalisation efforts.
More government assistance to support TACs and enterprises
11 Beyond the current LEAD programme, the Government also recognises the need to continue supporting TACs in their role as industry champions. As announced in Budget 2013, we are rolling out several programmes that TACs can tap on. I strongly encourage more TACs to come forward, and to catalyse and drive these initiatives. Let me touch on three areas that you can work on.
12 First, the government will enhance LEAD funding to encourage SMEs to usebusiness development intermediaries through TACs. These intermediaries will have overseas business connections to help your members. As we all know, on their own, SMEs may find it difficult to source for good business deals in other countries. IE Singapore is able to help. But we would like to extend our reach by asking our TACs to also come in and overcome these obstacles, by tapping on reliable in-country intermediaries, or “deal hunters”, to help our SMEs. Through these connections, we hope our TACs can help their members to expand overseas by introducing potential business deals, sourcing for suppliers and seeking out potential franchising and licensing opportunities. IE has started discussions with several industry and broad-based TACs to embark on this initiative.
13 Secondly, the government will also be working with our TACs onCollaborative Industry Projects (CIP), which aim to address the key productivity challenges. We want to encourage SMEs to form partnerships with solution providers to test out productivity solutions. When this is done and found successful, we can replicate it to other members. The proliferation of such solutions is important if we want to raise the productivity needle of the sector and for the whole of Singapore. For a start, we will launch CIP for six sectors: food manufacturing, food services, furniture, printing and packaging, and retail and fashion. But the CIP is not limited to these sectors, and I encourage all the other TACs to look at these initiatives seriously and to see how they can benefit their members.
14 Today, I am pleased to share that The Restaurant Association of Singapore (RAS), in partnership with Singapore Food Manufacturers’ Association (SFMA) andSingapore Manufacturing Federation (SMF), is issuing a call for collaboration between food services companies and food manufacturers or suppliers. They will work together to arrive at solutions to outsource the preparation and production of food items that are not the core offerings in the menu. The restaurants could then focus on producing specialty dishes and, thus, minimise food preparation at the outlets. This partnership will also bring about new business opportunities for food manufacturers and suppliers, as well as improve their scale of operation. I encourage companies to take advantage of the CIP scheme to foster such collaboration.
15 I note that other associations, such as the Singapore Logistics Association (SLA), Singapore Transport Association (STA) and Singapore Association for Private Education (SAPE), will also be working with SPRING to issue calls for such collaboration. In fact, TACs, such as the Print and Media Association Singapore (PMAS), have already identified a few potential vendors for its Management Information System (MIS), and will be short listing a vendor. More TACs, including the Packaging Council of Singapore (PCS), will come on board to drive the productivity of their respective sectors.
16 The third area is to address the challenge SMEs face in attracting and retaining talent. The government has introduced the SME Talent Programme. With this programme, we hope TACs will play a bigger role in alleviating the talent shortge and pressure faced by the SMEs. It will help local SMEs to attract students from the polytechnics and Institutes of Technical Education (ITEs), by sponsoring study awards and offering the students job opportunities upon their graduation. TACs that have a strong understanding of their respective industries will match good candidates with good SMEs. They will also be able to work closely with the polytechnics and ITEs to profile SME careers and choose the right students for this programme. TACs will also select SMEs with effective HR practices, and who are able to provide meaningful career development paths for the students.
17 I am happy to note that six TACs have already stepped forward to offer this programme for the SMEs in their sectors. They are the:
- Restaurant Association of Singapore (RAS)
- Print and Media Association, Singapore (PMAS)
- Textile and Fashion Federation Singapore (TaFf)
- Association of Small and Medium Enterprises (ASME)
- Singapore Manufacturing Federation (SMF), and the
- Singapore Chinese Chamber of Commerce and Industry (SCCCI)
I hope to see more TACs taking up this challenge of helping their members to build up a talent pipeline for their sectors and companies.
Vision for more TACs to co-create innovative solutions for their industries
18 With the greater role that TACs will now play in enhancing the development of our businesses, TACs themselves will need to stay abreast of developments in their respective sectors and markets, and examine the value they can offer to members and potential partners. They should have the vision to innovate, constantly adapt and embrace change, in order to take advantage of business growth opportunities. They will also have to work closely with their members to push innovative and game-changing solutions,in order to tackle the industry challenges they all face.
19 On the part of the Government, we pledge to continue to support our TACs, especially in positioning themselves for the longer term. IE Singapore and SPRING Singapore will be expanding their current scope of support under the LEAD Programme for the TACs in order to further develop their internal capabilities. This includes the development of strategic capability roadmaps to better serve their sectors in the long term.
20 Moving forward, I hope to see greater collaboration among the various TACs and partners to reach out to and support SMEs in their business needs, especially through the new SME Centres that are being set up.
Conclusion
21 So ladies and gentlemen, let me once again congratulate the recipients[1] of this year’s LEAD Awards for their commitment towards improving and supporting the growth of their sector. I look forward to seeing the results of the various industry projects, and I hope that by sharing at this Forum today, this will also spur other TACs to think of practical ways to drive the development of the various respective sectors.
22 On that note, I wish all of you a fruitful session today. Thank you.
[1] The five LEAD Awards recipients – Restaurant Association of Singapore (RAS), Singapore Association of Private Education (SAPE), Singapore Business Federation’s Sustainable Development Business Group (SDBG), Singapore Food Manufacturers Association (SFMA) and Singapore Logistics Association (SLA).