1. Friends of the media, you might remember some time back that I shared with you about Singapore’s Manufacturing 2030 plan. Last week, I went to Illumina to talk about how we intend to attract world class frontier companies to anchor their operations in Singapore and bring along the local SMEs in their ecosystem. Today, I am here at Sanwa.
2. Sanwa is the model of what we want to do with our local enterprises. It is an example of how we intend to groom our local enterprises into globally competitive companies. We’ve talked about frontier companies and today, I will specifically zoom into the things we want to do to help our local enterprises to continue to do well in the coming years. To support our local enterprises and to enhance their competitiveness particularly in the advanced manufacturing sector, we have a four-pronged effort. I will go in-depth into each of the four prongs.
3. The first prong has to do with how we work with them for product innovation. The second prong has to do with how we work with them for process innovation. The third prong has to do with how we help them to penetrate new markets and to have a more global footprint in their production process, going beyond Singapore. The fourth prong has to do with how we need to work with our local manufacturing companies to attract and retrain new talent.
4. Let me go in depth to the four prongs. The first prong has to do with product innovation. We all know that for small and medium enterprises (SMEs), it is very difficult for them to do product innovation and to have an in-house product development team all by themselves. In Sanwa’s example, they do have an in-house R&D team but obviously, in a very competitive environment, this is necessary but not sufficient. What we want to provide going forward for many of our local enterprises is the ability to access R&D facilities and talent as a platform.
5. Let me explain what we mean by that and how Sanwa has been a good example of using some of the facilities beyond them, as a service, in order to strengthen their product innovation capabilities. For example, now that Sanwa is going into medtech, they are working with Fluidigm which is helping them to upgrade their technologies from producing things where their precision is about 30 microns to now one micron, or submicron precision. Working with external partners like Fluidigm to build up their capabilities to penetrate the medtech sector is one example.
6. We also have other examples whereby Sanwa is able to work with our own research Institutes like SIMTech and the Institute of Materials Research and Engineering (IMRE) to produce the nanowells required for the biotech and medtech sectors. Being able to access services from SIMTech to IMRE to ARTCs are examples of how we can provide some of these product development capabilities as a service to our local enterprises.
7. Besides Sanwa, we have other examples like Fong’s Engineering which has established SG Endoscopy. They are also working with SIMTech and accessing the capabilities within SIMTEch to help them with their product innovation. A more familiar example is the food innovation resource centre which is working with Cocoba Pte Ltd, which produces the famous Irwin’s salted egg fish skin that many of you might be familiar with.
8. Through such Centres of Innovation (COIs), be it in the polytecnics, or Institutes of Higher Learning (IHLs), since 2006 to 2019, we have undertaken more than 11,000 engagements to help our local enterprises access such services and platforms so that they do not have take on all the overheads internally in order to produce the product innovations required. That’s the first part about helping our companies improve their product and strengthen their product innovation system by accessing many of the platforms, research institutes, IHLs as a service in partnership with our local enterprises.
9. Besides product innovation, the second part that we need to work with our companies on is process innovation. It is not about the product design but about how fast we are able to improve the production system in order to strengthen our competitiveness. This is again an example whereby it is difficult to have all the capabilities within an SME in Singapore. This is where we work with institutions beyond the companies to allow them to access such services.
10. Earlier on, as I was moving around Sanwa, they were showing me how they worked with Nanyang Polytechnic. Nanyang Polytechnic came up with an entire system which helped them to do the testing - a Made-in-Singapore testing system. This is the kind of collaboration that allows our local enterprises like Sanwa, to leap from their own dometic capabilities to access a wider network of capabilities in Singapore.
11. From the Government’s perspective, we have the Automation Support Package (ASP), the Productivity Solutions Grant (PSG) and we are also proliferating Industry 4.0 to help our companies improve their production processes. Sanwa is one example of a company that has made use of the ASP and now, they are into the project and are using it to improve the production processes. With that, they achieve higher productivity and better margins.
12. Sanwa has also – even before we proliferated Industry 4.0 – embarked on their own journey to review their production process to see how they can better integrate the data that they have to improve their production system. Some of you might have seen the control tower that was set up with a combination of the local system and the Iplast system that they have been able to access in order to improve this. Improving the product is number one and improving the production system and processes is number two.
13. Let me then go on to the third part, which is working to help our companies to strengthen their global competitiveness andaccess a larger supply chain and a larger market beyond Singapore.
14. Last week, I launched the Southeast Asia Manufacturing Alliance to help our local manufacturing companies to expand their footprint beyond Singapore by leveraging the connections of the various business parks run by Singapore companies. With that, we can diversify the risk and have a better layout that makes use of the relative competitive advantages of the different places where we are producing. Sanwa is again a good example. They have a regional production footprint from Jakarta to Batam, to Malaysia, China and India. With this, they can produce different things at different places based on the relative competitive advantages. The other example that we are helping our companies to do is the Market Readiness Grant which also work with companies like Sanwa, to go beyond Singapore, to see how we can leverage on other people's expertise and weave it into our ecosystem.
15. The fourth pillar of our support and help for our local enterprises has to do with talent development. Today, I am very happy to see both ends of the talent development spectrum in Sanwa. We have very young people coming from the polytechnics to do very interesting work with the current management team. They are not just coming here as an intern to learn but they are also coming into the company to contribute their ideas and strengthen their relationship with their polytechnics, which are also Centres of Excellence for various of the technologies that we wish to proliferate.
16. On the other end, beyond attracting the younger people into advanced manufacturing itself, we also have a very good example of how Sanwa has upgraded its workers all along the way. I'll just give two examples.
a. One of them, Mr Chou Siew Chai, came in as a technician. Earlier, he showed me how, with Sanwa’s help, he progressively moved up the skills ladder, and got a degree along the way. Now he's a manager of the plant. But beyond the title of the manager, what impressed me most was that with his 30 years of knowledge in advanced manufacturing, he was able to integrate the processes and devise new machines and systems to help improve the production processes and quality control of the process that he was responsible for. This shows a lot of deep expertise and knowledge that our people have in the advanced manufacturing sector.
b. Another example is Madam Goh Cha Boh, who was retrenched some time back and joined Sanwa. She is now 65, but is still being trained and retrained by Sanwa to do some of the cutting edge processes in Sanwa itself. This is very inspiring whereby age is no longer a barrier. With advanced manufacturing, the kind of machines and processes that we have, even someone who is in the late 50s, early 60s can be retrained to take on some of these high value jobs that are being created in the advanced manufacturing sector.
17. On the other hand, our polytechnics and ITEs have more than 30 work study diploma programmes. Sanwa itself has also more than 30 of such employees coming through the ranks, which gives us the confidence that if we put our mind to it, we are able to attract sufficient people into the sector to do some of these cutting-edge work, and also to build up the deep knowledge.
18. Beyond the four-prong strategy, what makes it happen has to do with the leadership. So long as our enterprise leadership is prepared to take on this task, we will make sure that we find the resources to support them. This is why we spend so much effort on Scale Up Singapore, the Enterprise Leadership Transformation Programme, and other programmes in order to uplift the leadership capabilities and capacities to do the neccessary transformation. The training is not just about training the young people or older workers, it is also about training our enterprise leadership. When they are aware of what's possible, what's available on the market, then they will be able to naturally transform their operations.
19. Let me summarise the four-pronged strategy to help our companies compete globally. First, making sure that they have access to services and capabilities beyond their companies to innovate their products. Second, making sure that they have access to capabilities beyond their company to innovate their production processes – and this can be local or overseas capabilities. Third, making sure that we continue to help them to expand their footprint beyond Singapore, leveraging the region as their backyard to strengthen their competitive advantage. Fourth, making sure that we continue to develop the talent in this sector, from the young intern coming in, to the middle age workers who are transiting to a new job to the older workers. Most importantly, the enterprise leadership capabilities.