ENABLING ENTERPRISENOVEMBER 2016
SHOWCASEDISPENSING CONVENIENCE AND NUTRITION: JR VENDING
JUMPSTARTA FASTER TRACK TO GROWTH WITH THE ACTION COMMUNITY FOR ENTREPRENEURSHIP
PROFILECREATING VALUE THROUGH INNOVATION-LED PRODUCTIVITY
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ENHANCING PRODUCTIVITY
THROUGH INNOVATION
2 NOVEMBER 2016
CONTENTS
EDITORIAL TEAM Marion ABRAHAM ([email protected])Amelia AW ([email protected])CHOW Zhi Ting ([email protected])Fazilah LATIF ([email protected])Felicia LEE ([email protected])Fizzah RAHMAN ([email protected]) Kathleen TAN ([email protected])Mark TAN ([email protected])
EDITORIAL & DESIGNPublicitas Content publicitascontent.com
NOVEMBER 2016
SHOWCASEDISPENSING CONVENIENCE AND NUTRITION
REDESIGNING THE ART OF JEWELLERY MAKING
A KEY INGREDIENT FOR BUSINESS SUCCESS
PROFILE CREATING VALUE THROUGH INNOVATION-LED PRODUCTIVITY
JUMPSTART A FASTER TRACK TO GROWTH PEOPLE DEVELOPMENT
20
1317
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22
5THE FOOD SERVICES, RETAIL AND FOOD MANUFACTURING INDUSTRY TRANSFORMATION MAPS AIM TO HELP SMES BOOST INNOVATION-LED PRODUCTIVITY AND SUSTAIN GROWTH
FEATURE STORY
MAPPING A STRATEGIC PATH TO GROWTH
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NOVEMBER 2016 3
BUZZ
The Business Excellence Awards 2016 winners (from left) Innovation Excellence Award winners, Mrs Elaine Ng, Chief Executive Officer, National Library Board, and Mr Chong Hoi Hung, Deputy Commissioner, Singapore Civil Defence Force; People Excellence Award winner, Mr Tan Peng Yam, Chief Executive, Defence Science and Technology Agency; Singapore Quality Award winners, Mr Andrew Tan, Chief Executive, Maritime and Port Authority of Singapore, and Mr Sim S Lim, Singapore Country Head, DBS Bank; and Singapore Quality Award with Special Commendation winner, Dr Hon Chiew Weng, Principal, Hwa Chong Institution.
A local bank, an educational institution and four public sector agencies are winners of this year’s Business Excellence (BE) Awards. They received their trophies from Mr S Iswaran, Minister for Trade and Industry (Industry), at the BE Awards Ceremony on 27 October. At the awards ceremony, Mr Iswaran announced that the BE framework will be enhanced to focus more on
people development and innovation capabilities. In addition, the Singapore Quality Class (SQC) will be repositioned as a single mark of excellence under the BE certification. Organisations will have to get SQC-certified as a base foundation, before choosing to deepen their capabilities in the niche areas of people, service and innovation. ¢
Committed to excellence
The Government has unveiled an Industry Transformation Map (ITM) to strengthen Singapore’s precision engineering sector. Announced on 12 October by Mr S Iswaran, Minister for Trade and Industry (Industry), it details plans for productivity improvements, internationalisation, skills and development, and technology innovation. A key strategy of the ITM is the shift to higher value-added activities, which will pave the way for the next era of manufacturing. The roadmap also identifies new growth areas that will create 3,000 jobs for professionals, managers, executives and technicians. Led by the Singapore Economic Development Board, the ITM is a first for the local manufacturing sector. ¢
Blueprint to strengthen local precision engineering sector
Success through franchising and licensingOn 13 October, outstanding achievers in the local franchising and licensing industry were honoured at the 2016 Franchising & Licensing Asia Awards Presentation Ceremony. At the event, Mr Ted Tan, SPRING Singapore’s Deputy Chief Executive (Industry & Enterprise Development), encouraged more local businesses to adopt a franchising or licensing business model to achieve business growth. He detailed three ways in which to succeed in franchising and licensing: build a strong brand equity and value; invest in intellectual property; and cultivate good relationships with franchisees. ¢
A representative from Meiban Group sharing about the company’s smart factory solutions with Minister S Iswaran.
For more information, please refer to www.spring.gov.sg/consultant-quality
Upgrading Your Business with Certified Management Consultants
Management consultants play a pivotal role in Singapore’s enterprise development landscape. Partnering quality management consultants can help SMEs achieve meaningful business outcomes.
SMEs embarking on business upgrading journey and seeking support for consultancy-related costs under SPRING’s Capability Development Grant (CDG) and Innovation and Capability Voucher for Consultancy (ICV-Consultancy), will need to engage management consultants with SPRING-recognised certification.
This certification for management consultants helps SMEs select the right partners who meet the minimum competency and ethical requirements to deliver on project outcomes.
SPRING-Recognised Certification for Management Consultants provides quality assurance to SMEs.
Appointed certification bodies for SPRING-recognised certification: • Institute of Management Consultants (Singapore) • Singapore PMC Certification Pte Ltd• TÜV SÜD PSB Pte Ltd
SMEs can view the lists of certified management consultants on their websites.
NOVEMBER 2016 5
The Food Services, Retail and Food Manufacturing Industry Transformation Maps aim to help SMEs boost innovation-led productivity and sustain growth
MAPPING A STRATEGIC PATH TO GROWTH
A s a global economic player, Singapore’s growth is influenced by m a c r o - e c o n o m i c
factors. With economies becoming more interconnected and competitive, companies need to transform and grow to hold us in good stead. The Singapore Government has set aside $4.5 billion for an Industry Transformation Programme – announced earlier in this year’s Budget – to develop roadmaps for 23 key sectors.
These economic restructuring roadmaps, or Industry Transformation Maps (ITMs), are designed around four key pillars – productivity enhancement, technology innovation, job redesign and upskilling, and trade and internationalisation opportunities - which aim to boost Singapore’s key industries.
S P R I N G S i n g a p o r e over sees the development and implementation of ITMs for the food services, retail, and food manufacturing sectors.
Recipe for growth in food services The Food Services ITM – the first of the 23 industry-specific roadmaps – was launched on 8 September.
One of the key goals of the Food
Services ITM is to make businesses more productive through the use of manpower-lean formats. SPRING aims to achieve this through a two-pronged approach – streamlining back-of-house processes and digitising front-of-house workflow.
For instance, SPRING will drive the implementation of kitchen automation and automated dishwashing technologies to improve back-of-house processes. It will also support companies in implementing digitisation
initiatives, like digital ordering and cashless payment systems, at the front-end.
Innovation wise, food companies are encouraged to adopt innovative business formats such as selling ready meals. SPRING estimates that by 2025, three out of eight dining experiences in Singapore will involve new formats such as grab-and-go vending machines, which operate and provide meals round-the-clock.
An example of a local company that has recently adopted this strategy is JR Vending. In August, the company
– which operates with a small team comprising professional chefs,
delivery men and technicians – launched Singapore’s
first VendCafé at Block 320C Anchorvale Drive
in Sengkang. VendCafé is
a cluster of 13 vending machines, including two C h e f - i n - B o x machines along with stand-up dining tables. The machines dispense hot meals, such
as seafood hor fun, snacks, sandwiches
and drinks, in under three minutes. In terms of jobs and
skills, SPRING and Workforce Singapore are developing a
Food Services Skills Framework to help employers map out clear career progression pathways and skills training needs, so that staff can
FEATURE
NOVEMBER 2016 5
6 NOVEMBER 2016
FEATURE
progress in their careers within the sector. Employers can also use SPRING’s HR Diagnostic Tool to assess their current human resource practices, identify gaps and opportunities for improvement and, ultimately, strengthen their human resource and staff capabilities.
SPRING, together with its industry partners, such as International Enterprise Singapore and trade associations and chambers, will also support companies in growing their businesses overseas through franchising, licensing, and building a strong intellectual property regime.
Retailing strategiesSMEs in the retail sector will also benefit from a range of initiatives outlined in the Retail ITM, launched on 15 September. Increasing operational efficiency by implementing self-checkout technology and boosting productivity through consolidating distribution of goods
using urban logistics services are just some ways that SMEs can reduce labour costs.
Businesses are encouraged to innovate by adopting an omni-channel approach to better engage with consumers. This means bringing together multiple sales channels, from brick-and-mortar stores to e-commerce platforms, and enabling consumers to browse online for information before making purchases through online and offline retail channels. It also means the integration of social media and leveraging third party marketplaces, such as Amazon, Tmall and JD.com, to reach more markets.
Companies can implement a parcel pick-up system to complement their e-commerce operations. Also known as “click and collect” services, it will enable customers to conveniently pick up their purchases at designated locations.
Business remodelling does not
end there. A key enabler of retail internationalisation, e-commerce can give local companies access to a wider range of customers regionally and globally, and encourage them to innovate their product offerings to meet different market needs and consumer tastes.
More efficient processes will also allow companies to redesign traditional jobs and create higher-value roles. Staff can be redeployed to enhance customer touchpoints or perform higher-skilled and more challenging tasks such as in the area of product development.
When local Peranakan jewellery company, Foundation Jewellers, automated some of its processes, such as soldering and sawing designs, it freed up its craftsmen to experiment with designs and styles, and refine their ideas. Automation has also helped Foundation Jewellers stay innovative and up-to-date with the latest industry trends, and attract younger jewellery designers to join the company.
Manufacturing for the futureSingapore’s food manufacturing industry is a key sector of the economy. In 2015, it contributed more than $3.7 billion to GDP and employed over 40,000 staff.
E-commerce can give local companies access to a wider range of customers
regionally and globally, and encourage them to innovate their product offerings.
NOVEMBER 2016 7
automation, food manufacturers can go from manufacturing and supplying products, to providing solutions for developing a food innovation network and ecosystem. This means playing a key role in fostering partnerships with large overseas firms for joint distribution and logistics, product development and sales – all of which could help develop
in technology to increase its production capacity and offerings to cope with the demands of one of its key clients, Changi Airport Group.
The company’s meat-filling and spreading machines replace the manual and laborious task of filling and spreading minced meat into flat, thin sheets for barbequing. Previously, the company
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With higher productivity and automation, food manufacturers can go from manufacturing
and supplying products, to providing solutions for developing a food innovation network and ecosystem.
The launch of the Food Manufacturing ITM on 18 November highlights several ways to transform the industry into Asia’s leading food and nutrition hub.
One way is through robotics and automation to improve various manufacturing and quality operations, speed up processes, and increase production capacity. Fragrance Foodstuff, a local manufacturer and supplier of bak kwa, pastries and mooncakes, invested
needed 10 staff to prepare 1,000kg of meat daily. Now it requires only between six and seven staff to operate the equipment. By 2025, Fragrance Foodstuff aims to automate 80% of its processes to sustain productivity and business growth.
These cost savings from higher productivity can be used to invest in other areas, such as innovation, to drive revenue and growth. For instance, the Food Innovation Cluster makes it easier for businesses to connect with research institutes to create new product offerings or designs. This includes developing new manufacturing techniques and improving product quality, taste and packaging. In turn, this would encourage businesses to upskill their staff to support innovation efforts and, ultimately, boost export-driven growth.
With higher productivity and
and strengthen the competitiveness of Singapore’s food manufacturing industry and businesses.
Securing sustainable developmentIn the long run, it is difficult to imagine growth without innovation, productivity and internationalisation.
However, these ITMs – which seek to spearhead trade, industry and economic growth – and its strategic initiatives must be complemented by a willingness to collaborate and explore uncharted growth areas and markets, and embrace risks and opportunities.
Only then will local enterprises be able to respond effectively to economic challenges, seize global opportunities in the future economy, and help Singapore achieve its annual target of 2-3% productivity growth.
8 NOVEMBER 2016
How innovative and productive business formats can increase operational efficiency and enhance business growth
Process automation at back-of-house
l Automating dishwashing and cooking operations
l Setting up a central kitchen
Digitisation of front-of-house servicesl Adopting digital ordering and
cashless payment systems
Ready-meal formatsl Ensuring quality and nutritious
packaged mealsl Making food and
beverages available via vending machines
Food Services Skills Framework
l Mapping out clear career progression and skills
training paths for staff
INDUSTRY TRANSFORMATION MAPFOOD SERVICES
Growing the “made-in-Singapore” brand overseas
l Enhancing capabilities in intellectual property
protection, and franchising and
licensing
NOVEMBER 2016 9
DISPENSING CONVENIENCE AND NUTRITIONChef-in-Box VendCafe mixes Singaporeans’ love for fast, delicious and quality food with innovative technology
SHOWCASE
NOVEMBER 2016 9
ith little time to spare in between conference calls, meetings and events,
many Singaporeans are looking for convenient solutions that would provide them with tasty meals after a long day’s work. At the same time, many are choosing healthier food options. So how do we marry convenience and nutrition to meet this demand?
Introducing Chef-in-Box VendCafe, a cluster of 13 vending machines, which include two Chef-in-Box machines, that dispense hot, pre-packaged meals.
Launched in August 2016 at Block 320C Anchorvale Drive in Sengkang, VendCafe, the brainchild of JR Group, operates around the clock, and is accompanied by stand-up dining tables
W to retain the eating-out experience. The ready-to-eat meals or Chef-in-
Box – such as Nasi Goreng Istimewa and Mutton Rendang with Briyani Rice – are prepared by culinary specialists using fresh ingredients and quality produce in a central kitchen, before being packaged, chilled or frozen. Priced between $2.50 and $5, Chef-in-Box can also be purchased frozen for later consumption. The vending machines also dispense drinks, snacks and sandwiches – all in under three minutes.
So what inspired this solution? Manpower-lean unmanned cafesChief Executive Officer of JR Group Holdings Pte Ltd, Ms Jocelyn Chng’s (pictured above) passion for food and
nutrition, and desire to help others make healthier food choices has taken her as far as Japan and several European countries.
“During my travels to these countries, I was impressed by the availability of fresh, hot meals at vending machines and automated food cafes,” she explains.
In 2001, Ms Chng saw a potential business opportunity in Singapore’s ready-to-eat food industry. Leveraging its expertise in cook-chill and cook-freeze ready-to-serve meals, JR Group began developing a solution that marries delicious, nutritious food with innovative technology.
“That’s how Chef-in-Box VendCafe was born,” says Ms Chng. “With the manpower crunch and high staffing costs in the food and beverage industry,
10 NOVEMBER 2016
SHOWCASE
increasing productivity through an automated solution like Chef-in-Box VendCafe seems like a step in the right direction.”
JR Vending, a subsidiary of JR Group, manages the Chef-in-Box VendCafe.
“We don’t need anyone to man the vending machines. Essentially, they are like unmanned cafes,” says Ms Chng.
Unlike typical food outlets that rely on chefs, kitchen staff and waiters to prepare and serve meals, Ms Chng’s operations team comprises only professional chefs, three delivery men and three technicians, who manage the company’s more than 100 Chef-in-Box vending machines islandwide.
The vending machines are integrated with smart technology, which enables data from the machines to be accessed remotely. “This further eliminates the need to hire staff to keep an eye on things at Chef-in-Box VendCafe,” says Ms Chng.
The technology also assists in generating daily sales reports, providing insights into consumer purchasing patterns, and enabling remote stock-taking. “We use the technology and the data it generates to strategically update our inventory, prices and promotions.” Quality and safety are also assured as the system’s diagnostics help the company keep expired items out of its machines.
To ensure greater convenience for customers, the vending machines are also designed to accept a variety of payment methods, including cash and cashless payments through NETS FlashPay or credit card.
Providing quality-assured, tasty meals JR Vending hopes to change people’s perception that ready-to-eat meals are not tasty or healthy. That is why research and development is an important aspect of the company’s food production processes and business operations.
“Our cook-chill and cook-freeze technologies enable us to retain nutrients, freshness and flavour in our food items – all without using preservatives, additives or artificial flavourings,” says Ms Chng.
The company is also certified to Hazard Analysis Critical Control Point and ISO 22000, an international food safety management system standard.
This means that its food production
and safety processes meet international standards and best practices, giving consumers added confidence in the safety and quality of its products.
Two of its dishes, Yang Zhou Fried Brown Rice and Braised Chicken in Duo Olive Pronto Sauce, have been given the Health Promotion Board’s Healthier Choice Symbol – something that’s uncommon for ready-to-eat meals.
“This demonstrates our commitment to research and development, and providing Singaporeans with safe, tasty and high-quality meals,” she adds.
The company also constantly innovates its offerings to give customers more choices. Currently, it offers up to 30 ready-to-eat meals spanning across a variety of cuisines, such as Indian, Malay, Chinese, Japanese and Western.
Innovation-led productivity for future growthChef-in-Box VendCafe may be relatively new, but customer receptivity towards the initiative has given Ms Chng the
confidence to expand the concept across Singapore. “We get enquiries almost every day – mostly from companies in remote locations looking to provide meals for their night-shift workers.”
JR Vending is also in talks with the Housing & Development Board to install its Chef-in-Box vending machines at more void decks. “We aim to set up two more VendCafes by Q1 2017,” she adds.
Ms Chng strongly believes that productivity and innovation are key to the success of companies in the food and beverage industry.
“With the high competitiveness in the sector today, businesses need to find new cost-effective, productive ways to operate and, at the same time, constantly innovate to remain relevant.”
keytakeaways¢ Productivity improvements can help your business remain relevant in highly competitive markets.¢ Visit www.spring.gov.sg/CDG to find out how SPRING can help you boost your company’s productivity.
Ms Jocelyn Chng Chief Executive Officer of JR Group Pte Ltd
With the manpower crunch and high staffing costs in the food and beverage industry,
increasing productivity through an automated solution like Chef-in-Box VendCafe seems like a step in the right direction.
NOVEMBER 2016 11
Whichever stage of growth your business is at, having the right set of business capabilities will make you more competitive. SPRING Singapore’s Capability Development Grant (CDG) helps defray up to 70% of qualifying project costs when you enhance your capabilities to grow your business.
For more information, visit www.spring.gov.sg/CDG today!
TECHNOLOGY INNOVATION
FINANCIAL MANAGEMENT
HUMAN CAPITAL
DEVELOPMENT
BRAND & MARKETINGSTRATEGY
DEVELOPMENT
BUSINESS EXCELLENCE
SERVICE EXCELLENCE
PRODUCTIVITY IMPROVEMENT
INTELLECTUAL PROPERTY & FRANCHISING
ENHANCING QUALITY &
STANDARDS
BUSINESS STRATEGY
INNOVATION
Build Up Your Businesswith the
Capability Development Grant
Creating innovative retailersl Driving customer engagement
through online and offline channels
l Using in-store technologies to improve service
experience
Redesigning and creating new jobs
l Upskilling in emerging skill sets such as digital marketing and
data analyticsl Enriching traditional jobs through adopting technology like RFID
Venturing abroadl Building product/brand
ownersl Expanding globally
through digital channels
Increasing operational efficiencyl Adopting front-of-house
technologies such as self-checkout and mobile POS
l Implementing back-of-house automation like inventory and
warehouse management systems
INDUSTRY TRANSFORMATION MAPRETAIL
How retailers remain competitive in the changing retail landscape
NOVEMBER 2016 13
ow many Singapore businesses can boast the Queen of England as one of its clients? Foundation
Jewellers has that honour. In 2012, an intricately designed
diamond-encrusted gold brooch made by the company was presented to Queen Elizabeth II by the Singapore Government. Since then, she has worn the brooch at 14 different occasions, including recently at the christening of her granddaughter, Princess Charlotte.
Foundation Jewellers was set up by Mr Thomis Kwan’s father in the 1970s. At that time, the goldsmith shop, which was located in the Joo Chiat district, sold mostly jewellery imported from Hong Kong – then the region’s fast-emerging exporter of precious jewellery.
In 1988, when Mr Thomis Kwan (pictured above) and his younger brother, Mr Johnson Kwan, took over the business, they adopted a different approach. The
H
Foundation Jewellers uses automation to maintain the integrity of traditional Peranakan jewellery making, improve productivity and grow its business
REDESIGNING THE ART OF JEWELLERY MAKING
SHOWCASE
14 NOVEMBER 2016
SHOWCASE
brothers decided to design, manufacture and sell unique, made-in-Singapore, Peranakan jewellery in an effort to keep the Peranakan culture and legacy alive. Today, Foundation Jewellers is one of the few remaining master crafters of Peranakan jewellery in the Asian region.
“The Peranakan culture has a long history in Southeast Asia and Singapore, dating back to the 1900s,” says Mr Thomis Kwan, Director of Foundation Jewellers. “Our jewellery pieces, which blend European influences, Malay designs and Chinese craftsmanship, are designed to give our clients a sense of that period in history,” he explains.
A boost for productivityAs demand for the company’s handmade jewellery grew, so did the need to hire more craftsmen. “The more we expanded, the more craftsmen we needed to undertake a number of long, tedious, manual processes, such as moulding, cutting and soldering,” Mr Thomis Kwan explains. “Jewellery crafting is a niche skill and it isn’t easy to find quality craftsmen.”
Mr Thomis Kwan turned to automation to address this challenge. In late 2015, leveraging SPRING Singapore’s Capability Development Grant (CDG), Foundation Jewellers invested in a fibre optic laser marking machine and laser-cutting machine – a bold move, given that these equipment are typically used in heavy metal manufacturing.
When used concurrently, both these machines automate the manual sawing of motifs, the first stage in the Peranakan jewellery manufacturing process.
Now, craftsmen need only transfer their hand-drawn jewellery designs to the fibre optic laser marking machine system. Through computer-controlled technology, the machine automatically engraves elaborate and complex Peranakan designs on jewellery moulds.
Once that’s done, the laser-cutting machine, which uses the same technology, cuts the jewellery pieces into consistent shapes and sizes. This innovative strategy has resulted in significant productivity improvements.
The manual method allowed for only one design and one item to be created from each mould. With both machines, more jewellery designs can now be developed.
Previously, it used to take the
company up to a week to come up with a new design, and three weeks to fabricate a piece of jewellery. It would take even longer if errors were made.
With the lack of skilled craftsmen, the company could only produce up to three new jewellery designs a year.
“Today, creating a new piece of jewellery piece takes only 30 minutes, and we can produce up to 10 different designs a year,” Mr Thomis Kwan explains. “Our jewellery craftsmen now focus more on chiselling and shaping moulds.”
Tradition meets modernityGreater operational efficiency and productivity have enabled Foundation Jewellers to roll out a new, more modern brand to attract younger customers. “This is as a result of our craftsmen having more time and the right equipment to experiment with different types of designs and styles,” Mr Thomis Kwan adds.
The result? A 15% increase in sales
since January 2016, when the machines were deployed and new designs were introduced. “In a way, these machines motivate our craftsmen to develop, test and refine their ideas, thus ensuring that we’re constantly innovating as a jewellery brand.”
With automation, it has also been easier to attract young designers with fresh ideas. “They want to work with us as we now offer jobs that build skills for the future. In turn, their creativity helps us keep up with the latest trends in the jewellery industry.”
Preserving cultural valueMr Thomis Kwan believes that automation should complement and not replace the company’s high quality, authentic Peranakan craftsmanship.
“Our new equipment helps us save time, but it’s the fine details and cultural value of each jewellery that keep our customers coming back for more, especially those from overseas,” Mr Thomis Kwan explains.
Overall, he says, automation has helped the company innovate and achieve higher productivity. “It is primarily an enabler that allows us to produce more and, at the same time, maintain a high level of artisanal care and handmade quality in all our jewellery items.”
Mr Thomis Kwan Director, Foundation Jewellers
In a way, these machines motivate
our craftsmen to develop, test and refine their ideas, thus ensuring that we’re constantly innovating as a jewellery brand.
keytakeaways¢ Innovation can inject vitality into traditional craftsmanship.¢ Get inspired by productivity ideas at www.waytogo.sg/
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16 NOVEMBER 2016
INDUSTRY TRANSFORMATION MAPFOOD MANUFACTURING
How businesses can strategically grow through innovation, internationalisation and technology, and create higher-value jobs
Robotics solutionsl Scaling business operations
through automation l Redesigning existing
workflow and processes
Food Innovation Clusterl Accelerating development and
commercialisation of new productsl Connecting research institutes with industry for co-innovation
l Setting up shared R&D and processing
facilities
12
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Upskilling workforcel Establishing a skills framework on
current and emerging skills required for the food manufacturing industry
l Creating quality jobs in food product development, processing, and quality and safety to support innovation and export-driven growth
Globally competitive Singapore food companies
l Developing food products around consumer trends, and standards
l Adopting alternative entry modes such as via B2B sales channels and establishing in-
market presencel Fostering partnerships with large
global companies for joint-distribution or product
development
NOVEMBER 2016 17
12
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or two whole weeks, Mr Tan Cheng Kwee (CK Tan, pictured right), the second-generation owner
of Fragrance Foodstuff, worked with his staff and an automation machine fabricator to get the company’s first bak kwa cutter machine up and running. The cutter machine marked the company’s foray into automation in 2010.
According to Mr Tan, it took close to two years and many rounds of discussion and convincing to get the go-ahead for automation from the company’s first generation of owners, who preferred to retain the legacy business model and systems. “When we finally received the green light in 2010, I was determined to make the cutter machine work – even if it meant that I had to do it myself.”
Fragrance Foodstuff, one of Singapore’s leading manufacturers of bak kwa (barbecued pork jerky), has grown to 38 outlets across Singapore since its establishment in 1995. In 2014, the company reached a milestone when it was awarded a tender by the Changi Airport Group to supply bak kwa, meat floss pastries and mooncakes to one of its retail outlets.
Given that there are flights every day and at almost every hour – which translates to a continuous stream of customers – the company faces a high demand for its products. But that also meant longer work hours for its staff, who are required to produce a continuous supply of products. “The customer traffic at a single outlet in Changi Airport is equivalent to the combined customer traffic of up to eight shops in heartland areas,” explains Mr Tan, who is also the company’s Senior Manager of Business Development.
It was a turning point for the company when it realised the importance of
F
productivity in ensuring that it continues to meet customer demand and, at the same time, captures new customer segments at Changi Airport to sustain growth. “Looking back, it was a wise decision to start our automation journey in 2010,” says Mr Tan.
The automation journeyOne of Mr Tan’s priorities when he embarked on automation in 2010 was staff usability of the machines. “Automation should be straightforward and less complicated for rank-and-file staff to adopt and use,” he explains. “Only then will they be more open to change in work processes and environment.”
With proper training, guidelines and
SHOWCASE
Fragrance Foodstuff uses automation to boost productivity and cope with the increasing demand for its products
A KEY INGREDIENT FOR BUSINESS SUCCESS
Mr CK Tan Senior Manager of Business Development, Fragrance Foodstuff
We no longer need to worry about hiring
and training new production staff. In fact, we can now offer higher-value roles, such as in research and development, to enhance the quality of our products and create new recipes
18 NOVEMBER 2016
SHOWCASE
keytakeaways¢ Investing in automation can bring about long-term productivity benefits.¢ Find out how SPRING can support your productivity improvement and innovation efforts at www.spring.gov.sg/CDG
communication, staff began to see the benefits of automation. “Initially, they were concerned that automation would replace their jobs – but that did not happen,” says Mr Tan. “Instead, it led to higher productivity and tangible benefits like shorter working hours.” Some of the company’s staff have also been redeployed to higher-value tasks such as quality control.
That same year, with SPRING Singapore’s support, the company invested in a vacuum packing machine with a robotic arm. “Vacuum packaging enables us to lock in flavour and freshness, extend product shelf-life, and improve food handling practices.” So how does it work?
“With the vacuum packing machine, our products are automatically packed and sealed in a sterile environment, using air-tight pouches, to prevent contamination,” Mr Tan explains. In turn, this helps to increase shelf-life by 75%. “With a higher shelf life, our products can now be purchased as gifts or souvenirs by locals and tourists at the airport.”
The robotic arm replaces the manual process of picking and placing bak kwa into individual boxes before it is sent for delivery. This integrated automation has helped Frangrance Foodstuff increase productivity by 50% between 2014 and 2016.
The company followed this up in 2014 with meat-filling and spreading machines to do away with the laborious and time-consuming task of spreading minced meat into flat, thin sheets for
barbequeing.Since using these two machines,
Fragrance Foodstuff has seen an added threefold increase in productivity. It is also able to better cope with the demand for its products.
“Previously, it used to take 10 staff up to 10 hours to prepare 1,000 kg of meat every day,” says Mr Tan. “I noticed that our staff were tired, overworked and stressed, given that the business was growing rapidly.” Now, the company needs between only six and seven staff to operate the machines. “In fact, we can now prepare up to 2,000 kg of meat filling in under eight hours!”
Serving up ideas for growthThe time and manpower savings mean that the company has been able to focus more effort on coming up with new product offerings.
Today, Fragrance Foodstuff has more than 50 different products under its belt, including three new offerings – salted egg potato chips, salted egg fish skin and salted egg pork floss – which it rolled out in 2015 to attract younger customers. “We want to be seen as a company that keeps abreast of our customers’ preferences and behaviour, and moves with the times,” says Mr Tan.
In 2013, Mr Tan decided to take the business online. The company set up a website, which lists all its products and outlets, and social media accounts to better engage with Internet-savvy customers. It now receives regular
feedback on its service and products, allowing it to gain new ideas and continue innovating.
It has also ventured into e-commerce through partnerships with third-party platforms such as Qoo10 to expand the company’s sales avenues and increase opportunities for financial growth.
Ready for future opportunitiesMr Tan aims to automate up to 80% of the company’s processes by 2025. “Searching for the right staff willing to take on jobs that are repetitive and tedious in a tight labour market is tough,” he says.
He believes that higher productivity through innovation and automation is the key to sustaining the business and growing it further.
While these may be expensive long-term investments, Mr Tan sees it as a “happy problem”.
“We no longer need to worry about hiring and training new production staff, even when we expand overseas,” adds Mr Tan. “In addition, we can now offer higher-value roles such as in research and development to enhance the quality of our products and create new recipes.”
NOVEMBER 2016 19
20 NOVEMBER 2016
PROFILE
How would you describe the productivity levels in Singapore, especially in the food, hospitality and retail sectors? How does it compare to other developed cities?From 2013 to 2015, Singapore achieved an overall productivity growth of only 1%, weighed down mainly by the -0.6% productivity growth of domestically-oriented sectors, such as food, hospitality and retail. If you compare the productivity of Singapore’s domestically-oriented sectors with those of developed global cities, such as London, New York, Hong Kong and Tokyo, Singapore is lagging behind. That is why there is a need to restructure how these sectors operate to be more manpower-lean and productive.
Singapore leaders often emphasise innovation-led productivity as the main source for future growth. What does the concept of innovation-led productivity mean? While productivity is about value added per hour worked, innovation-led productivity is about creating value in terms of new ideas, knowledge and inventions. It
pushes companies to innovate and create new markets, resulting in higher-value jobs, wages and profits. This translates to higher GDP for the economy.
How should local enterprises go about implementing this concept? Concept differentiation, business model innovation and design thinking are key for businesses that are ready to take the innovation-led productivity route. That’s why over the past one year, SPC has been working with Boston Consulting Group – a US-based global business consulting firm – to develop masterclasses and workshops in design thinking and business model innovation
CREATING VALUE THROUGH INNOVATION-LED PRODUCTIVITY
to nurture and encourage local retailers to venture into innovation-led productivity. These masterclasses and workshops are supported by Workforce Singapore and SPRING Singapore.
Fifty-two participants from 41 Singapore-based companies – including Challenger, Guardian, Decks Pte Ltd, Beauty Language and Jean Yip Group – joined our first batch of masterclasses. The next run is scheduled for March 2017.
Alternatively, local enterprises and start-ups can leverage government incentives, programmes and schemes to upgrade their capabilities, implement innovation-led productivity improvements projects and initiatives. For instance, SPRING’s Capability Development Grant (CDG) defrays up to 70% of qualifying project costs, such as for training, certification and equipment. Companies looking to scale up the deployment of automation solutions such as robotic arms in production lines to improve operational efficiency can tap on additional funding support under SPRING’s Automation Support Package (ASP). Under the ASP, companies can apply for funds of up to 50% of qualifying costs for the deployment of automation projects, capped at S$1 million.
In addition, companies should look at internationalising their businesses. In this aspect, SPC regularly organises overseas study missions for local businesses in the food, hospitality and retail sectors. SPC will also be publishing best practice case studies and research, and launching a benchmarking portal in the first quarter of 2017 to enable businesses to gauge their performance against their industry peers, and remain competitive.
Could you provide some examples of innovation-led productivity?Creating efficient processes through adopting technology are fundamental and low-lying fruits that can be quickly implemented to bring business benefits. An example is local food business Five Star Chicken Rice, which uses a point-of-sale system to extract and analyse data to determine its most profitable items, ensuring better inventory management and higher profit margins.
Another innovative example is in the area of mobile payment. During a recent study mission to Shanghai, China, we learnt that more than 700 million people there use third-party payment systems, like
Mr Michael Tan Chief Executive Officer, Singapore Productivity Centre
Our Smart Nation initiatives are
setting the foundation for innovation-led economic and business growth.
Mr Michael Tan, Chief Executive Officer of the Singapore Productivity Centre (SPC), talks about the concept of innovation-led productivity and how it can make a difference for local enterprises
NOVEMBER 2016 21
PROFILE
Alipay and WeChat, to pay for everyday purchases, including food, transport, utilities and shopping. Now imagine if these payments are done manually. How many hours each week and number of staff would a business need to sort, handle, tally and perform data entry manually? Is it cost effective? Of course not. That’s why innovation is important.
What factors contributed to the rise of digital and e-commerce trade in China? In my opinion, there are two key contributing factors to China’s digital shift. China has progressed from having a lack of basic connectivity infrastructure to the mobile age; mobile phone usage has permeated even China’s rural areas, surpassing the use of PCs.
Additionally, the country’s flexible financial system, and willingness to allow private enterprises to innovate and lead change have catalysed the rapid adoption of innovative third-party payment systems. These provided the foundation for China’s e-commerce trade to prosper.
Singapore, too, has the potential and capacity to achieve and sustain such growth trajectory. Our Smart Nation initiatives, which include harnessing artificial intelligence, robotics, the Internet of Things and augmented reality, are setting the foundation for innovation-led economic and business growth.
What else can businesses do to move the needle on Singapore’s overall productivity performance?Businesses need to move beyond company-level productivity activities and embark on industry innovation-led and value-creating initiatives, including collaborating with regional and global businesses to learn and adopt best practices and novel ways of thinking and working. SPRING’s Collaborative Industry Project, which looks at addressing common industry-specific business challenges, promotes and supports such collaborative spirit. Domestically, businesses should work with one another and leverage their collective strength to adopt shared services, reap economies of scale, strategically grow and boost overall national productivity. ¢
INSIGHT
22 NOVEMBER 2016
B alancing your company’s immediate needs with its long-term growth is both paramount and challenging
– especially if your business is a start-up. Challenges, which include hiring the right people, retaining talent and expanding a business often result in start-up owners feeling like they’re spinning wheels and not making any progress.
Without the right support and ability to see where a business is going, it’s easy to get lost and overwhelmed.
A long-time partner of SPRING, the Action Community for Entrepreneurship (ACE) Ltd has played a key role in transforming Singapore’s entrepreneurial landscape, and providing resources, network opportunities and mentorships to help start-ups grow locally and globally.
Connecting start-ups with talentThe SME Talent Programme (STP) is an example of the dynamic partnership between SPRING and ACE. STP helps start-ups and SMEs attract young talent for business growth.
In September 2016, ACE came on
board as one of STP’s managing partners and will play an active role in matching Singapore start-ups’ demand for talent with supply from Institutes of Higher Learning (IHLs) through internships. Other partners of the programme include trade associations and chambers.
ACE will leverage its Youth Chapter, EDGE (Empower, Develop and Groom Entrepreneurs) – which comprises of student representatives from various IHLs who are actively involved in Singapore’s entrepreneurial scene – to give start-ups and SMEs access to a wider pool of young talent.
Singapore-based technology start-up, PigeonLab Pte Ltd, believes start-ups that provide interns with the right exposure and opportunities will be able to retain and develop a strong talent pipeline. “Essentially, we hope that through their internship experiences with start-ups, they will feel inspired to be part of the start-up ecosystem,” says Mr Lyon Lim, Co-Founder of PigeonLab.
As part of the partnership, ACE will also conduct training workshops to help start-ups build their human capital development capabilities in areas such
as recruitment, retention and talent management. By 2018, it aims to assist 200 technology-based Singapore start-ups and facilitate 400 student matches. Start-ups eligible for the STP will get a 70% subsidy for allowances paid to students during the internship period.
Going abroad One of the most significant challenges that start-ups face is entering new markets and gaining access to customers beyond Singapore. To help alleviate this challenge, ACE recently launched the ACE Silicon Valley Chapter in San Francisco, United States. This is its second such initiative after the ACE Beijing Chapter, launched in 2012.
Born out of a partnership between ACE and US-based Singapore network groups such as Bay Area Tech Singaporeans, the initiative aims to help businesses in Singapore leverage the network and expertise of their US counterparts to access the US market. Silicon Valley’s vibrant start-up culture and flourishing ecosystem of big technology companies, such as Google and Apple, serve as a springboard for network development and expansion.
“We’re hoping to see strong partnerships with the potential to drive real business impact for Singapore technology start-ups venturing into the US market,” said Mr James Tan, Deputy Chairman of ACE, at the launch of the initiative this year.
Essentially, ACE is looking to replicate its success with the ACE Beijing Chapter. It cites Avetics Global Pte Ltd as an example. Through events organised by the ACE Beijing Chapter, the local drone start-up gained access to a network of businesses and resource providers in China. This led to Avetics securing partnerships with drone manufacturers in China to develop its drone management platform, Exmaps.com.
ACE also actively looks out for potential markets that start-ups can venture into, and collaborates with various agencies and organisations to support local start-ups’ internationalisation efforts. So far, it has established partnerships in Bangkok, Guangzhou, Paris, Seoul, Vienna, and Vietnam.
A strong support systemStart-ups play a key role in job creation and fostering an entrepreneurial culture. These support initiatives seek to put start-ups on par with commercially viable businesses, and on a fast track to building a strong human resource base and achieving international market recognition. ¢
A FASTER TRACK TO GROWTH
JUMPSTART
SPRING Singapore and the Action Community for Entrepreneurship (ACE) Ltd are geared up to drive Singapore’s start-up scene forward
SME InfolineTel: (65) 6898 1800Email: [email protected]: www.smeportal.sg
SME CentresSME Centre@ASMEAssociation of Small and Medium Enterprises (ASME) 167 Jalan Bukit MerahTower 4, #03-13Singapore 150167Tel: (65) 6513 0388Email: [email protected]: www.smecentre-asme.sg
SME Centre@SCCCISingapore Chinese Chamber of Commerce and Industry (SCCCI) 47 Hill Street, #09-00Singapore 179365Tel: (65) 6337 8381Fax: (65) 6339 0605Email: [email protected]: www.smecentre-sccci.sg
SME Centre@SICCISingapore Indian Chamber of Commerce and Industry (SICCI) SICCI Building31 Stanley StreetSingapore 068740Tel: (65) 6508 0147Email: [email protected]: www.smecentre-sicci.sg
CONTACTS
SPRING Singapore is an agency under the Ministry of Trade and Industry, responsible for helping Singapore enterprises grow and building trust in Singapore products and services. As the enterprise development agency, SPRING works with partners to help enterprises with financing, capability and management development, technology and innovation, and access to markets. As the national standards and accreditation body, SPRING develops and promotes an internationally recognised standards and quality assurance infrastructure. SPRING also oversees the safety of general consumer goods in Singapore.
SME Centre@SMCCI Singapore Malay Chamber of Commerce and Industry (SMCCI) 15 Jalan PinangSingapore 199147Tel: (65) 6293 3822Fax: (65) 6293 3905Email: [email protected]: www.smecentre-smcci.sg
SME Centre@SMF Singapore Manufacturing Federation (SMF) 2985 Jalan Bukit Merah Singapore 159457Tel: (65) 6826 3020Fax: (65) 6826 3021Email: [email protected]: www.smecentre-smf.sg
For assistance, you can visit satellite SME Centres located at the Community Development Councils (CDCs), Changi Simei Community Club and Ang Mo Kio Community Centre.
Sales of StandardsToppan Leefung Pte LtdGreat World City East Tower 1 Kim Seng Promenade, #18-01Singapore 237994Tel: (65) 6826 9691Fax: (65) 6820 3341Email: [email protected]: www.singaporestandardseshop.sg
Standards CollectionNational Library BoardLee Kong Chian Reference Library 100 Victoria StreetLevel 7Singapore 188064Tel: (65) 6332 3255Email: [email protected]: eresources.nlb.gov.sg/standards
SPRING Singapore1 Fusionopolis Walk, #01-02 South Tower, Solaris, Singapore 138628
Tel: +65 6278 6666, Fax: +65 6278 6667www.spring.gov.sg