SPEECH BY MINISTER S ISWARAN, MINISTER FOR TRADE AND INDUSTRY (INDUSTRY) AT DELOITTE ASIA PACIFIC LEADERSHIP CONFERENCE ON 8 SEPTEMBER 2016, 8.45AM AT MANDARIN ORIENTAL HOTEL
Mr Punit Renjen, CEO, Deloitte Global,
Mr Yoichiro Ogawa, CEO, Deloitte Asia Pacific,
Mr Philip Yuen, CEO, Deloitte Southeast Asia,
Mr Chaly Mah, Former CEO, Deloitte Asia Pacific and Southeast Asia
Distinguished guests,
Ladies and gentlemen,
Good morning. Thank you for inviting me to join you today for the annual Deloitte Asia Pacific Leadership Conference.
2 The theme you have chosen for your conference - “Collaborate to Become the Undisputed Leader” – piqued my interest not least because it has also been one of the focal points for the work of the Committee on the Future Economy which I co-chair.
3 Competition is the lifeblood of business. Enterprises are engaged in a ceaseless effort to differentiate themselves, gain a competitive edge, and build market share. That has been the traditional recipe for business success. Collaboration as more commonly been emphasised within the context of an organisation, between principals and suppliers, or when venturing overseas into new markets.
4 But today’s globalised economy and its implications for business and the economy, compel us to contemplate collaboration through a new lens – as an essential part of corporate and economic strategy. There are several reasons for this.
5 Firstly, we live in a hyper-connected world where product cycles, time-to-market and supply chains are getting shorter. We therefore need much tighter coordination of functions across the value spectrum - from market sensing, operational adjustments and execution of new initiatives. While many of these functions remain within an enterprise domain, others will require collaboration with external partners.
6 Second, technological changes are disrupting businesses models and jobs at unprecedented rates. Robotics, 3-D printing, IOT, big data/data analytics, Artificial Intelligence and Autonomous Vehicles can fundamentally change industries and companies. Therefore, technology and business process innovation has become an existential necessity for companies in order to sustain their competitive advantage. But innovation, especially when it entails new technology, is an inherently risky and resource intensive business. Hence, we see the advent of new models of collaboration, sometimes even among competitors, such as open innovation to mitigate risks and share the costs.
7 Third, the solutions to today’s complex problems often require a multi-disciplinary effort. We therefore need our technical and professional talent (lawyers, accountants, bankers) to have a grasp of adjacent areas and to be able to work well in multi-disciplinary and multi-cultural teams to come up with effective solutions.
8 The need for and impact of collaboration take on added significance in the context of a small open economy like Singapore. Ultimately, countries compete at the system level. We need to stay abreast of the mega-trends that can affect us, and coordinate a response from workers, industry and the government. Indeed, this ability to respond as a system has been a defining feature and competitive strength of Singapore, and the Committee on the Future Economy is the most recent example of such an effort. In particular, the CFE has focused on how the different modalities of collaboration can be further catalysed.
9 In particular, a key focus of the CFE’s work has been how the different modalities of collaboration can be further catalysed within specific sectors. For example, the Legal and Accounting Working Group under the CFE, which Chaly Mah co-leads, is studying how further growth opportunities can be generated within these fields through closer collaboration between legal and accounting firms.
10 At the sector level, we are developing Industry Transformation Maps (ITMs) that integrate the strategies for productivity, skills development, technology adoption, innovation and internationalisation to better support the growth of our companies. These strategies will be developed and implemented in partnership with key stakeholders, such as companies, industry associations, business chambers, and unions.
Collaboration creates value for industry
11 The aim is to foster collaborations that can create value for an industry as a whole. This is particularly true of partnerships which build up industry capabilities, as well as those which support innovation and allow game-changing ideas to reach fruition.
12 In Singapore, we do so through the Partnership for Capability Development or PACT scheme. It is run by the Economic Development Board (EDB) and Spring Singapore, and supports partnerships between large organisations and small-and-medium-sized enterprises from the manufacturing and services sectors.
13 This could involve knowledge transfer from a large organisation to SMEs, upgrading the capabilities of SMEs which are suppliers to a large organisation, or test-bedding innovative solutions. (Approved projects are eligible for funding support of up to 70 per cent of qualifying development costs.) In the last few years, we have partnered Google, Intel and P&G, among others, to benefit SMEs in different areas such as e-Commerce, technology and leadership capabilities.
14 The PACT programme also supports co-innovation by large organisations and SMEs. There are many SMEs with new and exciting ideas who seek test-bedding opportunities with potential reference customers.
15 One example was between Sentosa and local tech start-up Cyrus Innovations. Cyrus Innovations developed an innovative new video analytics system which can automatically detect any unusual activity, going well beyond what was available in the market. But to rigorously test such technology, you need a large network of cameras to capture data, and a large number of people movements to generate activity data that is to be analysed.
16 Sentosa was therefore the ideal testing-ground, with the added benefit of improving the island’s own safety and security. The system can alert Sentosa’s management to safety issues such as unattended young children, and unusual activities such as fights breaking out in a crowd. Beyond the obvious benefit to the two parties, this partnership also helped to bring a cutting-edge technology closer to market for wider benefit.
17 We have also supported collaborations that allow local companies to create value on a regional or international scale. Banding together is an effective way for SMEs to venture overseas, allowing them to pool resources and capabilities, gain exposure and contacts, achieve economies of scale, and provide a stronger value proposition. Such collaboration can take many forms, from jointly promoting Singapore firms in new markets, to forming consortiums to bid for overseas projects.
18 Here, Trade Associations and Chambers (TACs) can also play a valuable role as a source of support for SMEs embarking on their internationalisation journey. (To build up our TACs and better equip them for this role, we introduced the Local Enterprise and Association Development-Plus or LEAD-Plus programme this year. Through SPRING Singapore, we are also partnering TACs to spearhead the development of solutions to industry-wide challenges - another means by which collaboration can bring about success.)
Collaboration brings benefits to society
19 But the scope and value of collaboration does not lie solely within the marketplace or the domain of business.
Collaborating with the public can bring benefits to society at large. There is also significant scope for collaboration between the public and private sectors to fuel innovation.
Collaborating with the public can bring benefits to society at large. There is also significant scope for collaboration between the public and private sectors to fuel innovation.
20 That is one impetus for our government open data portal, Data.gov.sg, which makes vast datasets available to the public. In April, we launched a new sub-site for app developers, providing one-stop access to government datasets ranging from PSI readings from the National Environment Agency to taxi locations from the Land Transport Authority.
21 The fruits of such collaboration, to develop solutions needed by the public sector, can also be exported and scaled globally. For instance, the Centre for Healthcare Assistive and Robotics Technology (CHART) at Changi General Hospital enables healthcare professionals to work with academia, industry and research institutes to develop solutions harnessing robotics and assistive technologies. These solutions serve our healthcare objectives of providing accessible, affordable and high quality care while managing the challenges of an ageing population and workforce. They can also be applied to other markets facing similar challenges.
Collaboration strengthens firms
22 Deloitte, with its broad capabilities, multinational presence, and diverse needs, is no stranger to the benefits of collaboration. A recent partnership between Deloitte and Geoprise Technologies (American company with an office in Singapore) was nominated for the 2016 Singapore International Chamber of Commerce Awards.
23 Through the partnership, Deloitte gained access to Geoprise’s deep technical capabilities in supply chain trading. Deloitte was also able to tap on Geoprise’s expertise in social technologies – a crucial edge in today’s digital environment. Furthermore, Geoprise was agile in its support of Deloitte by providing staff on demand, allowing for an efficient use of resources.
24 In turn, Geoprise was able to leverage Deloitte’s established brand name as a reference customer, grow its client base in Singapore, and gain more opportunities to scale up its operations globally. Deloitte’s support with cash-flow issues also assured Geoprise’s survival in its early years.
25 The collaboration between Deloitte and Geoprise is a good example of how two firms with different strengths and capabilities can work together to help firms scale up in a new domain and achieve market leadership. It also illustrates how large and small firms can be natural partners in a time of rapid change and disruption. (The former have the resources and depth of expertise to back a promising idea, while the latter are nimble and responsive enough to keep abreast of development.)
Conclusion
26 As the economic gravity of the world continues to shift to Asia, there is increasing interest and activity from MNCs and Asian enterprises to locate critical decision-making functions in Singapore that drive operations in the region. The increasingly complex operating environment will also generate growing demand for more sophisticated and multi-disciplinary advice and services.
27 In this regard, we welcome Deloitte’s partnership with Singapore (public-private partnership) to build up world-class capabilities to complement the Deloitte University Asia-Pacific, Deloitte Analytics Institute, and the Deloitte Risk Innovation Centre. In line with the theme for conference, I am confident that Deloitte will seek to develop new collaborations, not just amongst your member firms, but also technology providers, start-ups and research institutes in Singapore, piloting new business and service delivery models that can meet the varied needs of the region.
28 I look forward to a long and deep partnership between Deloitte and Singapore, and wish all of you a fruitful day ahead. Thank you.