SINGAPORE: To be competitive, firms need to build not only capabilities specific to themselves, but also industry-wide capabilities, Finance Minister Heng Swee Keat said on Wednesday (Aug 2).
He was speaking at the Economic Society of Singapore's (ESS) annual dinner, where he was made an honorary fellow of the ESS.
Pointing to rising global uncertainty, Mr Heng said that the Singapore economy’s competitiveness and ability to create good opportunities for its people rests on maintaining macroeconomic stability, strong microeconomic foundations, as well as encouraging individuals, firms and industries to build deep capabilities so that they can adapt and thrive in their fields.
"While we cannot predict the future, strong corporate and human capabilities give us the best chance of riding the waves of changes ahead," he said.
WHY WOULD A COMPANY TRAIN ITS COMPETITORS?
Beyond firm-specific capabilities that differentiate each company from its competitors, Mr Heng also called for companies to cooperate in helping build industry-wide capabilities.
He cited a visit he made several years ago to a company in Switzerland, which was training about 100 students to operate complex machinery.
"But the company needed only 60 new recruits. The remaining 40 would go to their competitors. Now, why would a company train for its competitors?"
The company's CEO explained that there would otherwise be an industry-wide shortage of talent, and a shortage would affect them all. "It was a lesson in competing and cooperating at the same time," Mr Heng said.
Industry leaders in Singapore too, have taken encouraging steps, Mr Heng said, citing the TechSkills Accelerator (TeSA), which trains ICT professionals, as well as the Trade Associations and Chambers (TACs) in building industry-wide capabilities.
He added that some industry leaders have asked if Singapore's economic agencies could also improve their coordination, to provide more integrated support, in areas such as helping companies to build capabilities and to internationalise. "We are studying these," he said.
"The marketplace is not an arena where companies are pitted against each other in atomistic competition … There is great potential for collective gain through collaboration, among partners along the value chain and even among erstwhile rivals, if we look for the right opportunities. We need to think about multiplying effectiveness, because it is not a zero-sum game."
Concluding his speech, Mr Heng said: "Let us compete fairly, but collaborate generously, and seek to be greater than the sum of our parts.
"And let us support one another, especially those of us who are less advantaged, so that we can all advance together."