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Transformation to adapt to an uncertain environment

Transformation to adapt to an uncertain environment

Marcus Neo Omni-Plus Systems, chief executive officer
Toby Koh group managing director, Ademco Security Group
Alan Lee, Elmich, founder and executive chairman
Moderator: Venga Subramaniam,The Business Times journalist

Question: We are looking for a winner to the Enterprise 50 Enterprise Transformation Award. Can you share with us your motivations for embarking on your own transformation journey?

Toby Koh For any business, transformation is simply continuous improvement. We must swim like sharks to survive. The world changes constantly. Client problem statements change, risk profiles fluctuate, and business models change. We must adapt to the changing times by transforming ourselves. Transformation is not an optional thought. It is essential for survival. Since day one, this has been our modus operandi.

Alan Lee:Going global was not something Elmich considered an afterthought. When we started designing and manufacturing engineered greenery products for urban landscapes and urban greenery in 1998, it was clear that we needed to expand our reach into international markets. In 2018, 60 percent of our business was exported.

It has been difficult and will continue to be a process. We need to remain relevant in today’s ever-changing business landscape and take bold steps for our continued advancement.

Marcus Neo:We started our transformation journey with the expansion of the operation to the entire region and the decision to use Singapore to manage operations across the region.

Q: What were your first steps? What were the challenges you faced? How did you overcome them.

MN: We started by identifying the gaps in processes and standardizing work practice. The biggest challenge is change management. We value teamwork among employees. We believe in the personal development of individuals for job satisfaction and high performance. Transparency breeds trust, so we encourage everyone to participate in information sessions and disclose their concerns to make them feel secure.

TK:It is important to change your mindset. Most people do not like change. My greatest challenge was to lobby those who didn’t realize we needed to change faster. I rallied all the people who were eager to join us on our journey to transformation and they became the internal champions that helped rally the troops.

Another challenge is identifying the right technology and deciding to deploy it. The latest technology may not always be the best option as it may not work well in our customers’ environments. Reliability is a top priority in the security industry. Therefore, it is important to evaluate the best security solutions for our clients in a methodical manner. This includes taking into consideration their budget, operational requirements, and other needs.

AL: We had to convince local customers that our products were as good or better than imported alternatives. Then, we had to convince them that we are not just another manufacturer of me too products. To do so, innovation and quality were key. This means spending hundreds of thousands of dollars each year on design, prototyping and testing, as well as paying intellectual property fees.

The transformation doesn’t have immediate results, especially with rising business costs, and the emergence or many similar products disrupting market equilibriums. Elmich has remained steadfast in delivering quality products, and has invested in technology and systems to strengthen its foundations as we move towards a global market.

To make business transformations successful, the workforce must change. To support the transformation, it was necessary to retrain existing staff.

Q: What government assistance did you find useful in your company’s journey to transformation? What areas does the government support such transformation efforts?

TK: Absolutely. The government grants that were granted to local businesses to help them digitalize and transform their business have been invaluable. Enterprise Singapore’s work is truly remarkable and covers all aspects of business functions.

Ademco is also part of the Scale Up program, where we collaborate with local businesses and consultants to improve our business strategy. We are helping our customers to change their traditional method of procuring security to a capital expenses (capex)-free managed service model.

AL: We received a lot of grants for investments such as for
Establishment of overseas offices and implementations of enterprise resource planning (ERP).

MN: The government’s support was essential in helping to reduce the barrier and overcome the fear of digitization. Enterprise Singapore supported Enterprise Singapore during the 2008 Lehman brothers crisis. This was our first step.

Q: How do you train and upskill your employees to make sure that no one is left behind?

AL:We established the goals for digitalisation, identified the knowledge gaps, and sent the relevant staff to the training courses to upgrade their skills. Regular communication was essential. We hired a project officer for the ERP system to help us develop a comprehensive implementation strategy and coordinate the migration with step-by–step guidance and tutorial.

It was essential that key personnel understood the process so they could communicate with their departments and facilitate buy-in. Elmichs believes in the importance of human capital.

MN: We worked with institutions for higher learning, such as Singapore Polytechnic. This included a training need analysis, identifying strengths and weaknesses for employees, and encouraging them to pursue courses to increase their skills. Many of our employees are currently pursuing Advanced and Specialist diplomas from Singapore Polytechnic. During the Covid-19 pandemic NTUC provided many online courses that employees could access.

TK: We place great emphasis on training internal employees and have a full-time trainer manager to manage our Learning Management System. On-the-job-training is another key initiative. Ademco works with external trainers to develop core skills that are not available in-house.

Q: How has your business benefited from investing in business transformation?

TK:One of the greatest benefits is the excitement it brings to my team to be part of the transformation journey that will shape Ademco’s future. It is difficult to be the first to make changes, but we have always had a market advantage by being proactive in transforming. This advantage could be as simple as being able drive more value to our clients, or to establish a strong foothold in a new area.

For long-term sustainability, every business must have clear leadership in certain sectors of its target market. This is an important aspect of a business and can be a source of pride for the team. Our customers can see real cost savings and benefits when we change our business model to a managed services model. Instead of traditional deployment of many security officers, we use remote monitoring to protect property from our central monitoring and command center.

This allows for the optimization of manpower, cost savings, and a decrease in carbon footprint by leveraging technology. This is exactly what Singapore’s government is trying to encourage with its Industry Transformation Map for security.

AL:Electronic resource planning systems allow for central storage of important business information such as customer, product, price, stock, order, stock, and finances. This increases efficiency and reduces paperwork. An electronic approval system makes it possible to electronically approve a purchase requisition in less than five minutes. Previously, the two forms required for a purchase requisition took 30 minutes each and required signatures.

We are also able to respond quickly to client requests in different time zones. Remotely extracting data from the office server can now be done to send it to customers anywhere in the world. We have better visibility into our inventory and can control our production capacity.

MN:We are available for work from home if it is necessary to distancing. You can operate your business as usual from any part of the region. Even in the face of shortages of skilled labor, we are able grow faster.

Q: How important is enterprise change for a business in an uncertain operating environment resulting from the ongoing pandemic?

TK:Businesses that don’t adapt and transform may not be able to sustain themselves in the long-term. Business owners have no choice but to plan how to pivot the business models for the future. Examining one’s unique value proposition is a half-yearly exercise. It is not a 3- to 5-year plan.

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AL:Since 2012, Elmich has been ISO 22301 Business Continuity Management Certified (BCM). This certification is crucial during the ongoing pandemic. We are able to work under unpredictable conditions and this has never been more important. BCM has helped us to be more resilient and better navigate these new challenges.

MN: We strive to achieve long-term results with all our stakeholders, including shareholders, customers, and employees. We are committed to continuous quality improvement in our business and operations through innovation, creativity, and business ethics.

Q: How has the pandemic impacted your business? What are the company’s efforts to remain competitive and relevant in a constantly changing environment?

TK: Both positively and negatively, Covid has had an impact on our business. Our headquarters in Singapore has done very well. Customers have been able to quickly adopt our managed services, especially as they are all looking for immediate cost savings.

However, 6 of our overseas subsidiaries have experienced frequent disruptions due to movement restrictions. It has been difficult to execute projects and visit clients. We have had the need to use more collaboration tools in order to help our clients achieve their goals and still deliver services from remote locations.

My colleagues and I even offered to live on the client’s premises for a few months to meet their operational needs. Our willingness to help our customers in even the most difficult situations across the Apac has strengthened their faith.

AL:The pandemic, and the disruptions to the supply chain including shipping, significantly affected the availability of imported goods and their costs. We also had to pay more for our own products which are used locally and abroad. Due to the closure of construction sites, it also had a significant impact on demand.

During this time, we reviewed our strategic business plan and re-charted our growth plans. We also improved our product innovations, production tool designs, and marketing collateral.

MN: We always prepare for the worst but hope for the best.

Q: What advice would you offer companies planning to transform themselves?

AL: Before you plan for business transformation, you need to assess the current weaknesses and strategies of your business. Enterprise Singapore offers several programs for small and medium-sized businesses (SMEs) that can help with business transformation.

MN: Don’t be too confident or overambitious. You will need to enlist the support of your stakeholders.

TK:Engage your team to get their support. Success is only possible when everyone works together. Take baby steps. Sometimes, one big transformation may be too difficult for the team. Small victories can encourage your team and increase the momentum. Validate, validate, and validate again that your strategy is logical for customers, team, and market.

Enterprise Transformation is supported by E50 Special Recognition Award Enterprise Transformation
By the Future Economy Council

This story appeared in The Business Times for the first time.

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