Speech by Minister S Iswaran at the Launch of Siemens Digital Factory Manufacturing Design Consultancy

SPEECH BY MR S ISWARAN, MINISTER FOR TRADE & INDUSTRY (INDUSTRY) AT THE LAUNCH OF SIEMENS DIGITAL FACTORY MANUFACTURING DESIGN CONSULTANCY, FRIDAY, 16 SEPTEMBER 2016, 5.10PM

Your Excellency Dr. Michael Witter, Ambassador of the Federal Republic of Germany to Singapore

Mr. Joe Kaeser, CEO, Siemens AG

Dr. Armin Bruck, CEO, Siemens Singapore

Distinguished Guests,

Ladies and Gentlemen,

Introduction

1.A good afternoon to all of you.  It gives me great pleasure to join you for the official launch of Siemens’ Digital Factory Manufacturing Design Consultancy.  I am glad that Mr. Joe Kaeser, CEO of Siemens AG, was able to be here to officially launch this consultancy, and to be one of our key speakers at the Singapore Summit.

A significant milestone in the long-standing partnership between Siemens and Singapore

2. Siemens and Singapore have enjoyed a long-standing and deep partnership.  Siemens first established its presence in Singapore in 1908, with a Technical Bureau operating as a sales office.  Today, Siemens has established its ASEAN regional headquarters in Singapore, employing over 1,500 people.  It has grown its activities in many of our key industries, including oil and gas, power, transport and healthcare.

3. The launch of this Digital Factory Manufacturing Design Consultancy marks another significant milestone in the partnership between Siemens and Singapore.  I am heartened that Siemens has selected Singapore as its first site globally to pioneer its new consultancy business, which is also the first of its kind developed within the global controls and automation industry.[1]

Singapore will continue to leverage technology trends and invest in advanced manufacturing to transform our manufacturing sector

4. The manufacturing sector is an important pillar of Singapore’s economy, contributing about 20 per cent of our nominal Gross Domestic Product (GDP) in 2015.  We have established global leadership positions in several key industries, such as electronics, biomedical sciences, energy & chemicals, and transport engineering.  For instance, Singapore manufactures six out of the top 10 drugs worldwide and three of the top wafer foundries are in Singapore.

5. However, there is no room for complacency.  Manufacturing is a globalised and highly competitive sector and we must continue to adapt to technological trends that are fundamentally transforming it.  As part of the phenomenon that some are calling Industry 4.0, we will see man and machine interact more than ever before.  Advanced manufacturing technologies such as the Industrial Internet-of-Things (IIoT), additive manufacturing, robotics, and cloud computing are not only disrupting industries, but also creating new opportunities for companies.  For example, these technologies will allow manufacturers to increase productivity and reduce operating costs by enabling predictive maintenance, remote monitoring, real-time supply chain optimisation and efficient energy consumption.

6. In response, Singapore is investing in advanced manufacturing technologies to better position our companies for the future.  Under the government’s Research, Innovation and Enterprise (RIE) 2020 plan, S$3.2 billion has been dedicated to support research in Advanced Manufacturing & Engineering.  The Committee on Future Economy (CFE), which is studying economic strategies to position Singapore for the future, has also identified Advanced Manufacturing as a key growth sector to be further developed.  

Partnerships are an important enabler of our industry transformation efforts

7. One important enabler for the growth of the advanced manufacturing sector, and for our industry transformation efforts in general, is partnerships.  According to a report by McKinsey & Company, strategic collaborations in the industry ecosystem will be a key factor for companies to successfully navigate Industry 4.0[2].  In particular, partnerships between technology providers and manufacturing companies will be important.  According to another McKinsey report[3], technology providers tend to be more advanced than manufacturers in terms of having an Industry 4.0 strategy and road map.

8. Fostering partnerships is thus an integral part of Singapore’s strategy to develop its advanced manufacturing sector.  For instance, the National Robotics Programme (NRP) supports collaboration between manufacturing companies, technology providers and local system integrators to provide end-to-end support in the adoption of robotics technologies.

9. The importance of forging partnerships to capture opportunities is also a key theme under both the CFE and the Industry Transformation Maps (ITMs), which were announced in Budget 2016.

Siemens’ new consultancy will support Singapore’s advanced manufacturing efforts, and strengthen Singapore’s position as an innovation hub

10. Aligned with the overall emphasis on partnerships, Siemens’ new technical consultancy will partner Singapore-based manufacturing firms to develop the technology roadmaps required to digitalise their factories.  For example, Siemens’ Digital Twin technology will create a virtual twin of a firm’s production processes, to help manufacturers visualise what a factory-of-the-future might look like, and to identify areas for productivity and efficiency improvements.

11. Given the currently limited service offerings within the global market to help companies structure Advanced Manufacturing roadmaps, Siemens’ new consultancy, which is a first for Singapore, will plug a critical market gap in helping companies make the transition towards a digital future.  This project is also aligned with Singapore’s efforts to anchor more high-value manufacturing-related services, which will add to the vibrancy of our manufacturing ecosystem and catalyse the adoption of advanced manufacturing technologies.

12. Siemens’ consultancy is also a good example of how companies can use Singapore as a location to pioneer new technologies and business models, before scaling up to the region.  Singapore will serve as the lead demand driver for Siemens to build up the necessary reference cases with clients.  I understand that Siemens has already identified its first clients in Singapore, including dorma+kaba[4], which operates a high-tech factory in Singapore to manufacture door closers.  Once the consultancy model is proven successful in Singapore, Siemens will be able to scale its services to the rest of the Asian region.

13. On its part, the Singapore government will continue to work with leading companies such as Siemens to support the growth of advanced manufacturing activities in our economy, and to develop innovations that will transform and strengthen the competitiveness of our industries.

Conclusion

14. Let me conclude by expressing my gratitude to Siemens for your continued confidence in Singapore.  Singapore is pleased to partner Siemens in the development and adoption of new advanced manufacturing technologies in Asia, and we look forward to further and deeper collaboration in the future.

15. Thank you.

[1]  The global controls and automation industry provides technology support for the operations of industrial plants.  
[2] ‘Industry 4.0: How to navigate digitization of the manufacturing sector’, McKinsey Digital, 2015
[3] “Industry 4.0 after the initial hype - Where manufacturers are finding value and how they can best capture it”, McKinsey Digital, 2016
[4]  Headquartered in Zurich (Switzerland), Dorma+Kaba is a US$2 bil German-Swiss access control technology provider with 16,000 employees globally. Siemens is working with D+K to design a greenfield manufacturing facility incorporating digital technologies.