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Most firms still unaware of industry transformation maps
TWO years after the Industry Transformation Maps (ITMs) began to be rolled out for various sectors, a majority of firms are still unaware of these sectoral roadmaps or how to benefit from them, a survey by the Singapore Chinese Chamber of Commerce and Industry (SCCCI) has found.
Only two in five firms had heard of the ITMs. Of these, 62.5 per cent were not sure how to participate and benefit from them. Another 20.7 per cent intend to take part via the relevant government agencies, while 10.3 per cent plan to get involved via the trade association for their sector, and the remaining 6.5 per cent by collaborating with other companies.
One of the SCCCI's recommendations arising from its survey is for trade associations to proactively engage government agencies in implementing the ITMs, or - if there is not yet such a roadmap for their industry - to approach agencies about developing similar initiatives or exploring how to fit within the existing ITMs.
Conducted from May to July with 966 respondents, of which 93 per cent were small and medium enterprises, the SCCCI Annual Business Survey found that rising business costs remain the top challenge, cited by over four in five respondents.
Though more firms reported revenue growth compared to the past two survey years, more firms were also seeing rising business costs: 78.9 per cent, up from 72.3 per cent the year before. Salary and rent were the main contributors to rising business costs, but more firms - 31.5 per cent, up from 27.8 per cent - also cited government compliance costs or administrative fees as a factor.
Stiff competition in the Singapore market and manpower shortages were also major worries, each cited by about three in five respondents. Finding opportunities in new growth markets, innovation and cost-cutting were the top strategies to tackle concerns. Some 65 per cent of respondents plan to go overseas in the next three years, up from 61 per cent in 2017's survey.
Firms' experience with productivity efforts differed, with more than a quarter seeing no improvement from such efforts. A small extent of improvement was seen by 45 per cent of firms, with moderate improvement seen by another quarter and a great improvement by just 3.5 per cent.
Better results were seen by larger firms and firms in construction and manufacturing. Another of SCCCI's recommendations was for the government to enhance its Productivity Solutions Grant, to maintain the productivity improvement momentum.
In manpower, recruiting staff with the right skills overtook attracting and retaining staff as the greatest challenge, with almost three in five firms unable to recruit staff with the required skills. Apart from government schemes, firms were most keen for the government to make its rules and regulations less rigid, with more than half of respondents calling for it.
The SCCCI also recommended that trade associations should take the lead in helping firms overcome common industry challenges, and help firms tap support schemes to get workers with the right skills.
In a separate digitalisation survey, conducted in August with 366 respondents, SCCCI found that 64 per cent of firms have gone digital. The most common uses of digital technology, each cited by between 46 and 49 per cent of respondents, were improving internal processes such as human resources and finance, customer engagement, digital marketing, as well as improving business processes.
The main obstacles to digitalisation were a lack of resources (cited by 57.1 per cent) and high costs (54.2 per cent).