THE results of the government's productivity drive has been mixed so far, with some companies already making changes to raise efficiency standards but also others that continue to rely on the old way of doing things, said Senior Minister of State for Trade and Industry Lee Yi Shyan yesterday.
Mr Lee made the comment at a panel discussion during a productivity seminar organised yesterday by The SME Magazine - a publication of The Business Times - and the National Productivity and Continuing Education Council (NPCEC) and supported by the Ministry of Trade and Industry and Ministry of Manpower.
Responding to a question on the results of the government's initiative to raise productivity levels in Singapore so far, Mr Lee said: "The overall picture is mixed...there are still many others out there that don't realise that change is happening in the industry and competition is intensifying. They are reliant on the old way of doing things."
He later told reporters at the sidelines of the seminar that going forward, the government will need to "percolate down the various initiatives for more companies to adopt them".
These will involve improvements at the company levels, while some will be industry level initiatives, he said.
The government is also trying to "cross fertilise" ideas from different industries so that companies from different sectors can learn from each other, and get the early productivity adopters to champion the transformation process, added Mr Lee.
At yesterday's seminar two companies - precision engineering firm Feinmetall Singapore and packaging, printing and supply chain company Teckwah Industrial Corporation - shared the initiatives they each undertook to raise efficiency levels.
Teckwah has intensified training of its employees, streamlined processes and sought help from consultants to lead small productivity groups made up of its employees.
It semi-automated a packing process that has led to higher output and lower costs. Output has increased from 1,200 finished goods per hour, to 1,350 an hour. It also needs just 26 operators for the packing process now, down from 35 previously.
Cost wise, it has seen savings of about $55,000 over a three-month period, which translates into savings of $200,000 a year, said Thomas Chua, chairman and managing director of Teckwah.
But productivity gains can be made even without automation. Feinmetall's general manager Sam Chee Wah said that embarking on some simple housekeeping can go a long way.
Some initiatives the 25-man firm has introduced include sticking labels on anything from files to cabinets, so that employees do not have to spend an unnecessary amount of time searching for what they need.
"In reality, is productivity and innovation really so difficult?" asked Mr Sam. "We can start with something that is very simple, very small."
The seminar also touched on the topic of relocation, specifically, to Iskandar Malaysia, and whether this would lead to a hollowing out of the manufacturing industry in Singapore.
Mr Lee: "I think it is unlikely because both Singapore and Iskandar offer different value propositions." Singapore, he said, is expensive but has a highly skilled workforce, and good physical infrastructure and technology support, while Iskandar has a wide expanse of land, fairly good infrastructure and is trying to build up its talent base.
"So some of their aspirations, such as in education or healthcare, will actually complement Singapore. I see that if we really make our two economies seamless, there is a lot more to gain and we have a bigger pie to share collectively," he said.
Teckwah's Mr Chua also does not believe that the manufacturing industry here will be hollowed out.
The group is relocating part of its manufacturing plant for its print business to Iskandar to serve as its high volume output centre for the region, but has also built a new digital print media hub at Paya Lebar called Pixel Red that will serve as a "high-value, technology driven output centre" for new markets in the print industry.
It will also serve as a centre of innovation in print media technology, and a "focal point for like minded companies to come together and collaborate with Teckwah" to create more efficient ways to grow output, said Mr Chua.
Iskandar and Singapore, therefore, complement each other, he said.
"Our investment in Singapore is three times what we invested in Iskandar, and at Iskandar you are talking about us making use of the low-cost facilities", while Singapore will focus on higher-value work, explained Mr Chua.
The seminar, which was sponsored by Standard Chartered Bank, also saw Jeffrey Chua, partner and managing director of Boston Consulting Group in Singapore and Jacky Tai, principal consultant at Strategicom, share their thoughts on how companies can raise productivity.