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Singapore's SMEs need to use IT or die

Certain local government bodies are concerned about the rate at which SMEs specifically in the manufacturing and precision engineering industry in Singapore, are embracing New Economy tools. Sloth, or resistance to change may prove to be fatal.

The 'e' has forced everyone to change the way they work, but what about the 'c'?

SINGAPORE - Ed Miller believes that while the Internet and electronic commerce has revolutionized the way the companies do business, it really isn't the goal but rather the means.

"There is a terrific opportunity here, and we need to utilize it"

Ed Miller
CIMdata Inc.

Miller, president of CIMdata Inc., was in Singapore recently as the keynote speaker for the PE21 forum, a Gintic-sponsored event for the local precision engineering industry.

Miller in his keynote speech, addressed the need for the industry to embrace collaborative processes, especially in the product defination management stage.

Collaborative product defination management (PDM) isn't new, according to Miller. "We're just taking the next step," he said, referring to the use of the Internet as an easily accessible platform that was allowed for a faster rate of collaboration than before.

"There is a terrific opportunity here, and we need to utilize it," he said.

Competitive collaboration

Gintic will be using the exhibition to showcase its IT innovations, such as using the Internet for collaboration between partners in the supply chain.

"With this collaboration, the clients, the supplier, the designer... will be able to work together," Ling said, "They can see the same thing, do it at the same time, immediately change it."

"If they [SMEs] don't start working with their customers and their suppliers, very soon they will be out of the supply chain,"

James Ling
Gintic

Working over the Internet will mean more business for the smaller players, he commented, adding that players in Taiwan, Korea, and Japan have already started moving into the electronic arena, taking away market share from local players that are slow on the uptake.

But some small companies have traditionally not been able to purchase equipment that they need to compete globally. The institute has tried to address these issues by rolling out some services.

The institute has developed a product data exchange software/system called PDEX. The XML-based solution does file conversion of various CAD/CAM files formats that are the mainstay design formats of the manufacturing industry, allowing smaller players that might not be able to afford expensive software, to convert their files to work with clients with differing formats.

But the 'single-point' conversion of data is only the tip of the iceberg to Ling.

"If they [SMEs] don't start working with their customers and their suppliers, very soon they will be out of the supply chain," he said.

"The service that [the SMEs] provide is only a part of the entire cycle," he reminded.

Ling also noted that high-tech equipment is getting cheaper, and that the institute was working with software companies to make cheaper software for manufacturing companies.

"We try our best to help them," said the business manager, "We want to tell them: 'You have to come in now'".

Lending a hand

The institute's parent, Singapore's National Science and Technology Board (NSTB), is also endorsing the strategy that Gintic is taking, and is supporting the forum/exhibition as well.

"IT is pervasive in business now... it's like oxygen to human beings..."

Teo Guan Hock
NSTB

"IT is pervasive in business now," said Teo Guan Hock, general manager for NSTB's R&D program in Singapore and soon in Israel.

"It's like oxygen to human beings, it's part of parcel of business."

Teo highlighted that the Board is trying to encourage SMEs to work with any of its 13 research institutes like Gintic, at which point the company would provide matched funding.

The projects would have to involve some research aspect, and have to be something that hasn't been done already.

Get IT, or get out

Teo admitted that to many of the local SMEs, anything that was unfamiliar was risky for them.

"Companies think short-term because they are P and L (profit and loss) driven," he said.

"If Moore's Law is changing, how relevant will industries today be tomorrow, if they don't change?"

Teo Guan Hock
NSTB

R&D would slow companies down because of the resources dedicated to such endeavors, and make them vulnerable and perhaps inefficient in the process.

SMEs aren't sure of how much investment needs to go into moving to the next level, said Teo, pointing out that the PE21 event would allow them to see how much is needed and if such a move would be within their reach.

Teo pointed out that the commonly adhered-to Moore's Law - the belief that computer chips would double in speed every 18 months, had now shortened to 12 months.

"If Moore's Law is changing, how relevant will industries today be tomorrow, if they don't change?" he queried.

"In the next 10 years, everything will change, technology will change." said Teo. "If you don't change, you'll be obsolete - you'll be out of business."