Keynote address at LED Symposium
Mrs Josephine Teo, Second Minister for Manpower, Grand Copthorne Waterfront Hotel
Minister for Manpower, Mr Lim Swee Say
Dr Robert Yap, SNEF President,
My parliamentary colleague, Mr Desmond Choo,
Ladies and Gentlemen
- I’m very glad to welcome everyone to the Lean Enterprise Development, or LED, Symposium 2017.
- I was not able to join you at the first symposium last year, but I am glad to be able to join you for the second symposium.
- Although we are holding the symposium at the same venue, a lot has changed in one year. The message one year ago was focused on encouraging more companies to take the first step in becoming more manpower-lean. At that time, just over 1,400 companies had come on board the LED journey.
Good momentum in lean transformation
- In the past year, many more companies have started the journey of transformation.
- Now, three times as many companies, 5,200 have taken up the LED Scheme.
- What is also very encouraging is that they are in all sectors – food services, construction, retail, logistics and manufacturing – and the companies are of all sizes – from micro SMEs to multinationals.
- MOM/WSG and our partner agencies, especially SPRING Singapore and our tripartite partner NTUC-e2i, are very encouraged by this strong momentum.
- It’s not so much that the LED Scheme is successful, but the bigger success is that the lean message is finally getting across.
- We now can see more companies having the determination and the ideas on how to grow their business the smarter way, by improving processes and also by employing more technology, not necessarily more people.
- In case you think that only the businesses benefit from this transformation but not their employees, I’m happy to share that for projects supported through NTUC-e2i, workers enjoyed an average salary increase of 16%. How was this possible?
- When the companies grow in a more manpower-lean way, each of those workers became more productive.
- Montreux Patisserie is one such company that experienced a growth of 11% in sales as a result, and shared its gains with the workers. Credit goes to the bosses for sharing these productivity gains with their employees by raising their pay.
- The work environment has improved as well. For example, they invested in a cake-cutting machine.
- Before this, the process was done manually and relied solely on the precision and skills of workers.
- As the cakes are displayed on the shelves of many 5-star hotels, the whole cake would have to be thrown away if even one slice was not the same size as the rest. That is the service level agreement that the company has with the hotel.
- With the cake-cutting machine, it is now very rare for the slices to be unevenly cut.
- They have cut wastage for the company, the hotel customers are happy, the workers are also happy.
- When I visited their new factory, the boss, Mr Lee Chit Shung, told me his staff are now much happier, to the point that they jokingly said they will quit or take MC if the machine is out-of-order!
- Jokes aside, the improved work environment also helped to retain workers and reduced staff turnover.
- These show that coming on board the LED Scheme is a win-win-win for the employer, employee and the customers! And of course, by extension, the whole economy.
- You will hear more about these examples during the symposium today.
- I would like to take this opportunity to commend the good efforts of LED agencies in this transformation journey. These include SPRING, WSG, IMDA, STB, EDB, BCA, NTUC and e2i, SNEF, SAPPHIRE, and our LED multipliers.
- Now that we have been able to achieve this strong momentum, we can now set our sights higher.
- First, at the enterprise-level, transformations to become manpower-lean should be more pervasive i.e. across all sectors among all companies big and small.
- Second, we should go beyond enterprise-level transformations and aim for breakthrough transformations at the industry-level so that everyone can be uplifted together.
- Let me explain.
Enterprise level: ready-to-go or customised solutions
- In the interactions that our agencies have with many companies, the bosses sometimes tell us that they find it difficult to start on the lean journey even if they wanted to, because they may want to automate some processes but don’t know how, or they have been told of the many options and can’t decide. They may also be unsure if the vendor is trustworthy, and whether the solution can be upgraded in the future.
- In the next phase of the LED Scheme, agencies will focus on making ready-to-go solutions more widely available.
- As the name implies, ready-to-go solutions are pre-approved by Government agencies such as SPRING Singapore, A*STAR and IMDA because they have been tried and tested: someone else has already implemented them and enjoyed improved productivity outcomes.
- You therefore need not worry about ineffective solutions, or fly-by-night vendors.
- Put another way, the agencies are not just telling you why you need to learn how to fish, they are advising you where the best place to fish is, and which fishing rod to use.
- Some of the highest impact ready-to-go solutions are featured in the programme today. These include the Electronic Container Trucking System or eCTS for the logistics and transportation industry, which you saw in the video earlier, as well as the Smart Management & Tracking System or SMTS which can benefit many businesses including those in manufacturing, logistics and retail.
- Take, for example, retail companies that adopted SMTS. It will give you much higher efficiency as it helps to reduce stocktaking time. Those companies that have implemented it even have spare manpower to deploy to do customer service, and help grow the topline.
- During the panel discussion later, you can learn more about ready-to-go solutions like SMTS, from companies that have adopted these solutions.
- However, ready-to-go solutions are useful if your business doesn’t require much customization. If you want to offer differentiation in terms of product or service and stand out from your competitors, can the LED Scheme still help you?
- Let me invite someone on stage to share with you what’s possible. Please help me welcome onstage Teo Peiru, the managing director of La Belle Couture, one of Singapore’s leading bridal boutiques.
[Interview segment - centrestage]
Becoming leaner at the industry/cluster-level
- Peiru’s story is a good example of how enterprise-level transformation has been encouraging.
- What we also want to do is go beyond individual businesses and step up the scale of transformation at the industry level. By doing so we hope that this is how the LED efforts complement the Industry Transformation Maps (ITMs).
- One example is the hotel industry, which relies heavily on manpower.
- As part of the ITM efforts, WSG partnered McKinsey for the Lean Hotel Initiative or LHI, supported by STB and Singapore Hotel Association, or SHA.
- The 16 participating hotels worked together as an industry to identify common productivity gaps, share best practices, as well as brainstorm to design solutions to tackle these issues.
- Each hotel then implemented customised productivity improvement projects to close the gaps.
- We now see good results from LHI. For example, hotels that redesigned their front office processes experienced 10 to 20 per cent productivity savings in terms of manpower requirement, and shorter check-in time.
- This was accomplished in just 4 months; it would have taken a lot longer if it wasn’t through the industry’s collective sharing and learning.
- We need more of such industry-level projects to quicken the pace of transformation.
- We are also ramping up transformation efforts through LED multipliers like the Association of Early Childhood and Training Services, or ASSETS, and Workforce Advancement Federation, or WAF.
- Being closer to the ground, these multipliers understand the issues and pain points of companies. They can therefore identify or develop relevant solutions to address these issues, and push these solutions to their industries promptly.
- We are also in conversation with several industries to support their transformation. These include the furniture, farms, lift and escalator industries.
- I would like to thank ASSETS and WAF for their contributions to the LED journey. We need more Trade Associations and Chambers to play the roles of ASSETS and WAF, and transform more industries quickly.
What’s next for companies
- We will continue the current focus on ready-to-go solutions, as well as industry or cluster solutions.
- Investment in innovation helps companies upgrade the hardware, and hopefully improve the workflow. At the same time, we need to upgrade the software, and the most important of them all is your human capital – your workers.
- Under the LED Scheme, you can get support for temporary foreign workers to have the capacity to train and upskill your local workers to operate new machines and implement new work processes.
- We will take it one step further, by helping you to enhance the capability of your local workforce, so as to accelerate your transformation.
- We are piloting a new scheme called the Capability Transfer Programme, or CTP. CTP facilitates the transfer of capabilities to help local workers pick up world-class skills and knowledge lacking or in short supply in Singapore.
- Not only will our local workers attain new skills, they will get better jobs, and be ready for the future.
- Higher levels of support will be given for industry projects and projects with high impact.
- One early adopter of CTP is the container logistics industry.
- The Transport Integrated Platform, or TRIP, launched last week is a common platform that allows different industry systems to work in tandem.
- To deepen the skills of workers in digital container solutions, the Container Depot and Logistics Association of Singapore, or CDAS, is bringing in foreign experts to train local specialised TRIP users.
- As long as you are making an effort to be more manpower-lean and to enhance your capabilities, both the LED and CTP schemes are here to support you.
- To conclude, our companies in Singapore are responding well to the message that it is possible to grow while becoming more manpower lean.
- Now that the lean transformation is gaining momentum, let us keep up the pace to encourage even more businesses to adopt ready-to-go solutions or customise the solutions to their needs. Let us also aim higher for industry-level transformations so that everyone can be uplifted at the same time.
- I thank the presenters and companies at the booths for your efforts and willingness to share your experiences on this LED journey. Because of you, we have a strong line-up of companies sharing today.
- I hope that everyone will be inspired by them, and Transform and Grow like they have.