Low Choo Tuck, Former Director of Planning Division
SPRING SINGAPORE
Early Years
1. Singapore has enjoyed a relatively high economic growth since its independence. Between 1965 and 2004, the economy grew at an average annual rate of 7 per cent. During the same period, its per capita GDP increased by more than 50 times to its current level of about US$28,000. The economic growth is due largely to better management of its “people” resource and the Productivity Movement, which provides the impetus for continuous skills upgrading and improvement.
2. In the early years of its independence, because of a scarcity of natural resources, the country has to depend on high productivity increases to generate economic growth. The strategy then was to embark on an industrialization programme, with the aim of reducing the high unemployment rate during the period. In 1965, the first seed of the Productivity Movement was planted with the signing of the Charter for Industrial Progress between the National Trades Union Congress and the Singapore Employers Federation. The Charter included a Productivity Code of Practice and the setting up of a National Productivity Centre to promote productivity in Singapore.
3. With the establishment of the National Productivity Centre and the rapid industrialization, economic growth increased significantly. By 1972, the Centre was elevated to the National Productivity Board (NPB) and was entrusted with the mission of developing a world-class workforce. By the early 80s, an increasingly tight labour market had driven up wages. Companies realized that to compete successfully, they must introduce better management systems and more importantly had good labour management relations and teamwork. Unfortunately, the state of labour-management relations then was fragile and there were many industrial disputes. The situation prompted the then Prime Minister Mr. Lee Kuan Yew to initiate a Committee on Productivity (COP) to study the issues of improving productivity, work attitudes and labour management relations.
Launch of the Productivity Movement
4. The COP Report recommended that a Productivity Movement be launched to tackle the various productivity issues facing the country. The Productivity Movement aimed to create an environment that was conducive to productivity improvement at the national, industry and company level. This was to be done by garnering the commitment and active participation of the whole nation in activities to increase productivity. The ultimate objective was to raise the standard of living of the people. The Movement was to be led by a high-level tripartite National Productivity Council with representations from the government, employer groups and unions. NPB was entrusted with implementing the recommendations of the Council.
5. The Productivity Movement advanced in stages to focus on specific aspects of the productivity improvement process. These stages could be broadly classified as the awareness stage, the action stage and the ownership stage. At the awareness stage, the objective was to create widespread awareness and understanding of productivity among companies and the workforce. The main channel of communication was the productivity campaign. The campaigns were launched with specific productivity themes such as teamwork and positive work attitude, which provided a means of reaching out to the companies and workforce. Over the years, the campaigns enjoyed the wide support of the government, employers and unions at the highest levels.
6. In the second stage of the Movement, “action” was emphasized to translate awareness into specific programmes to improve productivity at the workplace. To help companies take action to improve productivity, NPB promoted the use of management consultancy. It helped match companies with private sector consultants as well as encouraged the development of small local consultancy firms through the Associate Consultant Scheme. NPB also assisted companies directly to improve their productivity. These companies were then used as model companies for others to emulate. Besides consultancy, in-company training was emphasized to equip the workforce with the relevant skills to increase productivity. NPB teamed up with reputable companies such as Singapore Airlines, Philips and Seiko Instruments to develop national training programmes in specific areas for managers and workers.
7. By 1989, companies and individuals had become actively involved in the Productivity Movement. Hence sustaining this enthusiasm became the focus of the ownership stage. To sustain the goal of a self-sustaining Productivity Movement in which productivity habits form part of the work ethic, NPB launched the Productivity Activists Scheme. Through the Scheme, key activists from the public and private sectors were inducted into the Productivity Movement to lead, organize and influence other members of the workforce in various productivity activities. Another aspect of ownership was the private sector taking the lead role in organizing the productivity campaigns. Forging partnership with the private sector helped the process of introducing new initiatives involving the industry and workforce.
Innovation Phase of Productivity Movement
8. Up to 1990s, the Productivity Movement had created a sense of urgency to change work attitudes, and promote a quality mindset and teamwork. Employers and employees became more aware of the importance and benefits of productivity. However, in the ensuing years, the economic environment changed. As a result of globalization, competition had become more intense. The economy, initially labour-driven and then investment-driven could no longer depend on labour or investment to generate growth. Economic expansion would have to come from qualitative improvements in the use of the country’s resources or what is termed Total Factor Productivity (TFP). Factors affecting TFP include manpower development, management systems, innovation and economic re-structuring. It was this focus on TFP that led to the merger of the NPB and the Singapore Institute of Standards and Industrial Research to form the Productivity and Standards Board or PSB in 1996. To better manage the TFP determinants, the new thrust areas for PSB were productivity promotion, manpower development, technology application, industry development and standards and quality development. In line with government policy, PSB also corporatised its chargeable activities which covered training, consultancy, technology applications, testing and certification.
9. In the longer term, the challenge for the Movement was to help Singapore make the transition to a knowledge-based economy. This new environment is characterized by shifts from input driven growth to innovation growth and from scarcity of resources to abundance of knowledge. By 2002, PSB was renamed the Standards, Productivity and Innovation Board or SPRING to focus on SME development, promotion and innovation and standardization and metrology.
Impact of Productivity Movement
10. The strong emphasis on human aspects of productivity in the early years had established a solid foundation for future improvement.. A good indication of the headway made by the Productivity Movement was the public’s perception of productivity where 90 % of the workforce understood productivity compared to an earlier figure of 40%. More workers participated in Quality Control Circle activities and generating savings of some S$80 million for their companies. Expenditure on training rose to 3.6% of payroll compared to an earlier figure of 1.8%. More importantly, the per capita income rose to S$37,600 in 2003 from S$11,000 in 1981.There was a general increase in the standard of living with 92% of the population owning homes and with life expectancy extending to 77 years.
Key Success Factors
11. Over the years, the Productivity Movement had enjoyed the support of key agencies such as the Public Service, the Ministry of Defence and the National Trades Union Congress. Each of these organizations had their own Productivity Steering Committee that coordinates and organizes regular activities to sustain productivity improvement activities for their workforce. The employer groups also played an important role, and contributed resources and leadership to many national and industry productivity programmes. Institutional mechanism such as the National Productivity Council played a crucial role in developing strategies and coordinating the efforts of all the stakeholders in the Movement. The practice of tripartism where government, employers and unions worked together to promote productivity also contributed to the success.
12. Another important contributing factor was the adoption of the best practices strategy. Since its inception, the Movement had drawn lessons from others and adapting these lessons to the local context. The Japanese Productivity Movement was a significant source of learning. Through the US$20 million Productivity Development Project funded by the Japanese Government, Japanese experts were dispatched to help and develop productivity programmes in Singapore and to provide training for Singaporeans in Japan. Training resources from the Asian Productivity Organization and the Japan Productivity Centre for Social Economic Development were also taped to enhance training on productivity practices.
Productivity Movement-A Marathon with No End
13. To conclude, managing productivity is like running a marathon with no end. The late Mr Kohei Goshi, former Chairman and President of the Japan Productivity Centre had summed this up very well in the following words:
“ All world –class marathons are designed to test the athlete’s endurance and will to win. Flat courses are inevitably followed by ‘Heartbreak Hills’ and a good athlete know that you cannot maintain the same pace throughout the entire marathon if you expect to win.”
Compared to the Japanese Productivity Movement, Singapore’s experience in managing the Movement is a relatively brief one. But significant progress had been made. This would lay the foundation for a sustained productivity growth in Singapore.
