Shaping New Possibilities for Singapore and the World
A SPECIAL PROMOTIONAL FEATURE ORIGINALLY PUBLISHED IN THE SEPTEMBER 2017 OF FORBES ASIA
Singapore’s long-term commitment to innovation, successful partnerships with businesses and well-educated workforce ensure the country is well-placed to navigate the challenges ahead and thrive.
Singapore has moved from third world to first in less than half a century. Along the way, it has earned a reputation as an innovative global city at the heart of Asia that has thrived despite its many constraints.
Yet, the city-state, which celebrated its 50th year of independence in 2015, cannot take its current prosperity for granted. Beset by technological disruption and geopolitical uncertainty, the world is changing rapidly.
A small country with no natural resources, Singapore has depended heavily on unfettered trade and healthy relations with the rest of the world to fuel its growth. But with signs that countries are developing a more protectionist stance, as well as greater assertiveness from global powers and intensifying competition, the road ahead may be a rocky one.
That said, Singapore has shown its ability to innovate in the face of challenges time and again, whether it was building an industrial base from scratch, developing one of the world's best airports, or establishing a more self-sufficient water supply. To thrive in a fast-evolving landscape, the nation will need to continue to innovate with a purpose by turning possibilities, fueled by passion, into reality.
As part of this effort, the Singapore Economic Development Board (EDB) and Singapore Tourism Board (STB) have launched a new unified “SG” brand for both business and tourism. The brand will signal to the world the country's relentless commitment to innovation. On a business front, it also reflects what Singapore has done and will continue to do: partnering global businesses on journeys to create new solutions and innovations with a positive impact on the world.
Singapore is a city of possibilities, driven by a passionate workforce to succeed. The long-term vision for the country is to remain the preferred choice for international businesses seeking to expand their business in Asia and beyond.
Panasonic: Connecting to regional customers
As a regional business hub well-connected to the region, Singapore is an ideal location for Japanese electronics giant Panasonic to house some of its headquarter functions. For instance, the group recently relocated its Refrigeration Compressor Business Unit (RCBU) headquarters to the city-state to be closer to its customers and better understand their needs.
The RCBU headquarters will bring together business functions such as research and development, sales and marketing, human resources, corporate planning as well as manufacturing innovation and procurement.
"The proximity to the market allows for swift management decision-making and adds value for our customers. We are always listening to our customers and this is one of the key drivers behind our strategic relocation of RCBU to Singapore," says Jake Hirose, director of Panasonic Asia Pacific.
"We recognise the demand growth in this market and we want to be at the frontline, not only to better deliver, but also to be closer to the market to further understand our customers’ evolving needs,” he says. “We are growing beyond being just a manufacturer – we want to be the leading refrigeration compressor company and brand globally."
Panasonic has not only established itself as one of the major players in the
consumer electronics sector in Singapore, but also in B2B businesses such as health care, avionics, semiconductor, vertical farming and invertor compressor manufacturing.
It also has a wholly owned research and development arm based in Singapore, which contributes to Panasonic’s global R&D in areas such as artificial intelligence technology, B2B cloud solutions and intellectual property services.
In Singapore, Panasonic has also benefited from policies that encourage talent development. This has become especially important as the company incorporates more cutting-edge technologies into its operations. Panasonic Appliances Refrigeration Devices Singapore, for example, is transitioning to a "smart" factory that uses automated solutions and robotics. As such, the company is looking to recruit and train system engineers capable of operating such advanced equipment.
"With this in view, Panasonic is committed to working with Singaporeans to increase their skill sets and build deep capabilities," says Hirose. He added that the presence of the RCBU Global R&D Centre in Singapore offers local employees a chance to take up leadership roles and drive innovative change in the region.
Pepperl+Fuchs: Powering Industry 4.0
One of the leading players in the new industrial revolution, German company Pepperl+Fuchs is a pioneer and innovator of industrial sensors for factory automation and an expert for explosion protection in process automation.
Its Singapore office acts as the headquarters for Southeast Asia in manufacturing and for Asia Pacific for sales. With around 1,000 employees, the Singapore office supports its manufacturing operations in Indonesia, Singapore and Vietnam.
Pepperl + Fuchs
Pepperl+Fuchs first came to Singapore in 1979, attracted by its well-educated and English-speaking workforce, stable political system and the rule of law. These attributes have become even more relevant as the company navigates challenges brought about by the move towards advanced automation and connectivity in manufacturing, which has been dubbed Industry 4.0.
To showcase its expertise in automation, the company recently set up a US$65 million global distribution centre in Singapore that features an advanced automated retrieval system and a direct connection between the warehouse and production facility.
"Industry 4.0 has brought about a lot of new challenges. Singapore's good education system supports companies in this area by providing them with the necessary skills," says Pepperl+Fuchs Asia's managing director Juergen Seitz.
Together with the EDB, Pepperl+Fuchs offers a program for students from the polytechnics and the Singapore Institute of Technology the chance to gain experience working at the company.
"The program allows students to adapt to a working environment, and allows us to get to know them better in order to get an idea of which area they may be better suited to," says Mr Seitz. The company also conducts R&D together with universities here in areas such as 3D printing and new production processes, he adds.
Beyond talent development, Pepperl+Fuchs has also benefited from Singapore's connectivity to the rest of Asia, and the support it has received from government agencies in opening doors to potential partnerships.
"Singapore is not only well connected to America and Europe but also to Asia, and EDB has been a big help in helping us connect with partners,” says Seitz.
PBA Group: Reinventing for Success
From trading mechanical and automation products to now manufacturing its own products using advanced manufacturing, homegrown firm PBA Group is constantly reinventing itself to keep up with the changes that impact its business.
Today, PBA designs and manufactures high performance mechanical precision components as well as automation and motion control components. "Rather than just assemble components for customers, we felt that we could build our own intellectual property for the components, which enable us to give customers a complete solution," says PBA Group Chief Executive Officer Derrick Yap.
Apart from being its headquarters, Singapore acts as a test bed for PBA's new products, which it manufactures in small batches here before rolling it out to the rest of the region.
"The think tank of the company is in Singapore. We do R&D here and small batch production of new products. Once the production is stabilized, we roll out to our markets overseas," says Yap. Outside of Singapore, the company has operations in eight other countries, including Malaysia, China, Taiwan and the Philippines.
Beyond new product development, PBA also develops prototypes of new business models in Singapore, and has recently unveiled several exciting new initiatives.
These include the Robotics Application Centre of Excellence (RACE), a training center to groom robotics engineers and help drive the growth of advanced manufacturing here. Its courses are designed for policymakers, business owners, educators and professional practitioners. It has also set up an incubator to invest in companies that are developing technologies of interest to PBA, and potentially drive new businesses.
"By working with start-ups, it exposes our engineers to new technologies that we can potentially internalize and benefit from,” Yap says.
Singapore: An Asian city of the Future
Despite facing a fast-changing global landscape and intensifying competition in the region, Singapore is well placed to weather challenges and maintain its position as one of the world's premier cities for business and finance, says Parag Khanna, a senior research fellow in the Centre on Asia and Globalisation at the Lee Kuan Yew School of Public Policy at the National University of Singapore.
In particular, the country is benefiting from its position as a gateway to the Association of Southeast Asian Nations (ASEAN), a dynamic region that is seeing healthy growth. More foreign investment is flowing into ASEAN as manufacturers look for opportunities in Southeast Asian as operating costs in China escalate. “ASEAN is one of the pillars of the global economy,” Khanna says.
ASEAN's efforts to integrate its members' economies will be a key driver of growth going forward, he adds. The ASEAN Economic Community (AEC) that was launched in 2015, aims to create a single market across the bloc that is the equivalent of the world's seventh-largest economy.
Beyond ASEAN, Singapore is also well connected to India, which is rising as an economic powerhouse to rival China’s success. "The Asia of the future is much bigger than China, and Singapore will benefit from these subregions. It is no secret that cities as far away as Dubai see Singapore as a role model,” says Khanna.
Meanwhile, Singapore's highly diversified economy will act as a bulwark against technological disruption and rising competition. "Small countries tend to have simple economic structure. For a small country, Singapore is by far the most diversified economy in the world; there is not even a second place," Khanna says. "Whether its petrochemical refineries or finance, there are very few sectors that Singapore is not involved in and employing people."
However, he notes the government needs to continue to train the workforce to handle higher value-added jobs as this disruption transforms the economy. Singapore’s education system will play a big role in this effort, in particular the collaboration between industry and academia, to ensure that graduates are equipped with skills that are relevant.
"The Government looks at what MNCs (multinational corporations) are coming in, which Singapore companies are growing and what skills are needed, and whether the schools are providing them," says Khanna.
"If there is a corporate investment in a certain area, such as Lucasfilm coming in for digital animation, you will suddenly find that the polytechnics will offer robust programs in that area to train a talented pool to support those ventures,” he adds.
With its world-class English-language tertiary institutions, Khanna proposes that education itself could be a moneymaking sector for Singapore. "If you increase the space in major universities you have the ability to attract top English-speaking students from middle-class families from China and the rest of Asia,” he says.