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Speech at Future Economy Conference and Exhibition 2019

Minister of State for Manpower Mr Zaqy Mohamad, Suntec Singapore Convention and Exhibtion Centre

Mr Teo Siong Seng, Chairman, Singapore Business Federation

Mr Ho Meng Kit, CEO, Singapore Business Federation

Professor Tan Eng Chye, President, National University of Singapore

Mr Simon Berger, Co-Founder of FUTR


Ladies and Gentlemen



1 Good morning. I am happy to join you at this year’s Future Economy Conference and Exhibition.

2 Since the report of the Committee on the Future Economy (CFE) was released, the tripartite partners – government, unions, and businesses – have been working closely to transform Singapore’s economy for the future.

  • For example, we launched 23 Industry Transformation Maps (ITMs), covering 80 per cent of the economy, to help each industry remain competitive, capture growth opportunities, and provide good jobs for Singaporeans.
  • We have been seeing good, albeit uneven, progress across different industries.

3 Between 2015 and 2018, overall productivity grew by 3.6 per cent per annum. This was higher than the 1.6 per cent per annum growth recorded in the preceding three years, from 2012 to 2015. Overall productivity growth was primarily supported by strong productivity gains in outward-oriented sectors such as manufacturing, while domestically-oriented sectors such as food services showed weaker productivity growth.

4 Given the projected slowdown in global growth and uncertainties in the global economy, we are expecting relatively weaker growth for our economy this year. The advance GDP estimates released earlier this week showed that the Singapore economy grew by 0.1 per cent on a year-on-year basis in the third quarter of 2019. Given the strong headwinds in our external environment, the imperative for economic transformation has become greater and more urgent.

5 In particular, our enterprises must adapt quickly to the new economic realities, deepen their capabilities, and innovate to compete globally. The rapid pace of technological advancements is also changing the way businesses operate and reshaping the future of jobs.

  • While some jobs may disappear, new and better ones will emerge.
  • Transformation is therefore not optional.

6 The good news is that there are still many opportunities to be found in our economy. The advancement of digital technology, for example, has created new business models, and new ways of doing things. It is up to us to seize these opportunities.

7 In order for industry transformation to be pervasive and sustainable, the government, businesses, workers, Trade Associations and Chambers (TACs), and unions all have a part to play.

8 Let me elaborate.

Supporting businesses in their transformation journey

9 Our businesses must take the necessary steps to transform to remain competitive and relevant in the future economy.

10 Transformation may sound like a daunting task. Many of you may have the same questions - What do I need to do? Where should I start? How do I compare tp my global counterparts?

11 Today, companies can tap on the many government programmes and tools available as they undergo transformation. We are constantly enhancing these resources to meet the evolving needs of companies.

12 For example, the Infocomm Media Development Authority (IMDA), together with Boston Consulting Group, has developed a Digital Acceleration Index (DAI).

  • This tool measures a company’s current digital maturity based on parameters such as the organisation’s corporate culture as well as how it has leveraged data and technology in its operations.
  • It also helps companies understand where they are in their digital transformation journey, and provide actionable insights for improvement.
  • Over 2,000 companies of all sizes, across multiple sectors, participated in the first DAI survey in 2019.
  • The next survey will be conducted from January 2020 and we encourage more companies to participate in the next round of surveys.

13 In addition to transforming businesses and industries, digital tech has also brought about new, disruptive business models, such as the platform business model. Seven of the top ten most valuable companies globally are now tapping on platform business models as engines of growth. Digital platforms, such as Uber, Airbnb, and WeChat, have transformed multiple industries.

14 Platforms are not solely the domain of digital giants. Increasingly, incumbent businesses are also embracing platform business models.

  • Rolls Royce is one such example, evolving from selling physical equipment such as jet engines to selling the utility of the equipment in the form of flight uptime.
  • Likewise, local businesses need to understand the opportunities that digital platforms can bring.
  • IMDA has made available the ‘Digital Platforms in a Digital Economy’ white paper.
  • Through the white paper, companies can learn step-by-step how to apply digital platforms in their business strategy, and better understand the challenges to avoid in order to be grow and scale their businesses.

Building deep worker capabilities

15 As companies adopt technology to transform their business, they should also develop concrete plans to redesign jobs and upskill their workers to take on the new job roles augmented by technology.

16 After all, an ASEAN study by McKinsey & Co showed that many business transformation cases had fallen short due to inadequate manpower planning, capability building and change management.

17 One company that has done well is Container Printers. They implemented a Digital Performance Management solution that allowed the production team to monitor real-time operation status with better response to dynamic changes.

  • This reduced the time needed for data entry and reporting, resulting in higher productivity and operational efficiency.
  • To help workers transition and take on new requirements, the company redesigned jobs and upskilled their workers. The good communication between management and workers also helped foster a positive attitude amongst workers towards the company’s transformation.
  • You will be able to hear more about their transformation journey during the afternoon session.

18 To help companies navigate through some of these pitfalls, Workforce Singapore (WSG) is working with SBF to develop an Industry 4.0 Human Capital Initiative (IHCI) for the manufacturing industry. The IHCI comprises an online job redesign resource portal and a capability building programme to help strengthen companies’ strategic HR planning, workforce development and job redesign capabilities as they embark on business transformation. WSG and SBF will announce more details in the first half of 2020.

19 Later, we will also be witnessing the signing of the Memorandum of Understanding (MoU) between SBF and the Institute of Systems Science at the National University of Singapore (NUS-ISS). Under the MoU, both organisations will collaborate to offer three training programmes to companies so that their leadership, middle management and employees can be better equipped to support their companies’ transformation process.

20 The shortage of skilled manpower is a key challenge that is commonly cited by companies in business transformation. To meet their manpower needs, companies can tap on the suite of programmes under the Adapt and Grow (A&G) initiative.

  • For example, the Professional Conversion Programmes (PCPs) provide wage and training support for employers to re-train workers to take up new jobs.
  • Currently, there are more than 100 PCPs in over 30 sectors. Last year, the A&G initiative helped to re-skill and place close to 5,000 jobseekers through PCPs.
  • Most PCP participants did well, with about 9 in 10 remaining employed 18 months after being placed. About two-thirds of them also commanded higher wages than before due to the skills they had acquired.

21 Transformation is an on-going journey. For companies who have started, you must press on and continue to look out for new opportunities, find ways to improve business processes and equip workers with the necessary skills. For those who have yet to start, I encourage you to do so now.

TACs and Unions as multipliers of changes

22 Through this transformation journey, a critical element of success will be the role that the TACs and unions play as multipliers.

23 On this front, SBF, as Singapore’s apex business chamber, has played an important role as a bridge between businesses, unions and the Government. Over the years, it has spearheaded relevant initiatives in areas such as technology development and deployment, manpower and skills development. To help businesses better themselves, SBF has worked with IMDA to organise a series of Industry Digital Forums to share ITM growth strategies, Industry Digital Plan and help SMEs use a step-by-step guide to go digital.

24 On the union front, the Labour Movement announced its plans to form Company Training Committees (CTCs) at this year’s May Day Rally. The CTCs will help companies chart and implement firm-level transformation plans, and identify training and skills needed for workers to accelerate and deepen the pace of transformation.

25 Many initiatives led by TACs and unions will benefit companies, especially our local SMEs. I urge our companies to reach out to our TACs and unions to support you on your transformation journey.


26 Building our future economy requires the right mindset - to be proactive, have the courage to try new ways of doing things, and to collaborate more with one another. We are starting from a good base with many initiatives and programmes in place to support our industries, companies and workers.

27 In closing, I thank all of you here today for being part of this community on the journey of transformation. Together, we can build a strong and vibrant economy, and continue to enjoy success that will benefit both our companies and workers for years to come.