Mr Lee Yi Shyan at the ISES Global Conference On Service Excellence 2011, 15 July 2011

KEYNOTE ADDRESS BY MR LEE YI SHYAN, MINISTER OF STATE FOR TRADE AND INDUSTRY AND NATIONAL DEVELOPMENT, AT THE ISES GLOBAL CONFERENCE ON SERVICE EXCELLENCE 2011, MOCHTAR RIADY AUDITORIUM, FRIDAY, 15 JULY 2011, 9.20AM

Provost and Deputy President (Academic Affairs), SMU, Professor Rajendra Srivastava,

ISES Governing Council Co-chair, Dr Tan Suee Chieh

Distinguished speakers, guests,

Ladies and gentlemen,

Good morning,

Let me thank you for inviting me to the ISES Global Conference on Service Excellence 2011. This annual conference has grown to be a useful platform for researchers and practitioners to learn new findings and exchange business insights that have created the latest success stories in the service industry.

Such insights are important simply because our businesses do not compete on an island. In fact, we are so connected to the global market, that the forces that shape the flow of capital and goods can also affect us instantly.

As you would have seen from the advance estimates announced yesterday, our Q2 was estimated to grow by 0.5 per cent. While manufacturing retreated 5.5 per cent year-on-year, the services sector continued its growth momentum at 3.3 per cent. Within the services sector, tourism-related sectors such as hotels and restaurants were growing healthily due to strong visitor inflows.

This quarter’s results also reflect the stability of a diversified economy, and the importance of a competitive service sector in acting as a counter-weight to the export-led, sometimes volatile manufacturing sector. I believe the Q2 estimates have also provided us a good backdrop for today’s discussion: how do we raise the productivity in the services sector in spite of a tightening labor market? How do we drive service excellence with fewer staff on the shop front? How does service excellence contribute to a firm’s productivity and bottom-line?

Overview of GEMS and GEMS Up

Earlier this week, you might have heard about Government injecting a further $84 million to boost the Customer Centric Initiative (CCI) Programme in Singapore. The CCI is one of the three key thrusts of the GEMS movement which was launched in 2005. GEMS Up was launched in 2009 as the second phase of the GEMS movement. The other two thrusts of the GEMS movement are Promotion and Recognition; and Service Research and Thought-Leadership.

Under the third thrust “Research and Thought-Leadership”, ISES was appointed by the Workforce Development Agency (WDA) to establish the “Customer Satisfaction Index of Singapore” (CSISG) framework in 2007.With the CSISG, firms could now benchmark themselves against competitors in the same industry or with firms outside. Some firms are even revamping their business strategies using customers as their start point.

Under the CCI, close to 8,000 establishments and their 183,000 workers have been mobilized to drive service excellence in their service sectors in the past five years. In addition, the perceived service quality has improved from 70.4 points in 2007 to 71.3 points in 2010, according to the CSISG.

While we are heartened by these improvements, we must recognize that raising service levels is a long-term undertaking. According to the American Customer Satisfaction Index (ACSI), the US took more than 10 years to achieve its highest score of 75.7 in 2010. Even the best among them are not resting on their laurels. Japan for instance, still regularly sends teams overseas to study service excellence efforts

[1]

.

Making use of Government assistance programmes

Amid such competition, how can we do better? Research on CSI shows that customer satisfaction goes beyond service quality and includes the customer's perceived value and their expectations. Our services firms must therefore tackle all three fronts: product quality, service level and managing customer expectation (by communicating accurately value proposition).

For these three areas, Government assistance programmes abound. For the beginner firms, they could start with the Customer Service Toolkit, and tap on the CCI and WSQ training programmes (under WDA). For those who have completed your first or even second CCI project, they could go on to system-wide capability-building projects customized to the nature of their business. The four Service Excellence Icons (Changi Airport Group, Ion Orchard, Sentosa Development Corp and Wing Tai Retail) that we highlighted a few days ago at the CCI Symposium are great role models.

To continually enhance service innovation capabilities in our firms, I am pleased to announce that WDA is launching a suite of Service Innovation training programmes. The programmes aim to equip the workforce from the service industry with the skills, mindset and knowledge to innovate and drive service innovation within their organizations, specifically in the area of customer experience. Over the next three years, WDA expects to train 20,000 service professionals across the operations, supervisory and managerial levels.

Several companies, including Home-Fix, Sakae Sushi, Swensen’s and Resorts World Sentosa, have already trained their staff under the pilot Service Innovation Training Programme. Their positive experiences should encourage more companies to make use of the SITP to transform their workforce for service excellence.

Conclusion

While we are comforted by the improvements shown in indicators such as the CSISG, we know that our competitors are racing ahead. Some surveys indicate that cities such as Tokyo, Hong Kong and Taipei have better customer orientation than we do. Some productivity surveys also suggest that Singapore’s service sector productivity is only about half to two third of some advanced economies. We will therefore need to run fast to catch up. It is an urgent task.

It is with this sense of urgency that we look forward to the deliberations afterward. Please have a great day learning ahead. Thank You.

[1] Under its “Service Productivity and Innovation for Growth” initiative