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Speech at Opening Ceremony of Panasonic's Refrigeration Compressor Business Unit (RCBU)

Mr Lim Swee Say, Minister for Manpower, Panasonic Appliances Refrigeration Devices Singapore

Employment practices
Mr Tetsuro Homma, President
Appliances Company, Panasonic Corporation

Mr Tsueneo Komon, Managing Officer
Member of the Board, Appliance Company, Panasonic Corporation

Mr Akio Kozaki, Director, Refrigeration and Air-conditioning Devices Business Division, Appliances Company, Panasonic Corporation

Mr Atsuno Terasaki, Director RCBU, MD RAPRDSG

Mr Heng Chee How, DSG NTUC

Mr Richard Tan, General Secretary, UWEEI

Mr Lim Kok Kiang, Assistant Managing Director, SEDB

Ladies and Gentleman

Good Morning.
  1. First of all, my heartiest congratulation on the official opening of Panasonic’s Refrigeration Compressor Business Unit. 
  2. Panasonic and Singapore have a long and strong partnership. Started in 1972, Singapore plant made refrigeration compressors for export to Japan. In 1988, higher value activities were added with the creation of a nine-man R&D team in Singapore. 
  3. Today, Singapore plant employs 1,300 staff, including a 50-man R&D team.
  4. To prepare for future growth, Panasonic is transforming its operations in Singapore. 
  5. With the official opening of the Refrigeration Compressor Business Unit (or RCBU) today, the Singapore operation will be transformed in three ways:
  6. First, the global Business Unit HQ will move from Japan to Singapore. I was told this morning that this will be the first such relocation of global headquarter outside of Japan in recent decades.
  7. Second, the R&D centre in Singapore will be upgraded - from a supporting role to a global leadership role. It will spearhead R&D for new products and emerging refrigeration technologies for Panasonic’s global business. It is expected to more than double in size as it takes on this new role. 
  8. Third, the Singapore manufacturing plant will be transformed from traditional manufacturing to Smart manufacturing – a Digitally-enabled Smart Factory with a manufacturing control tower.
  9. With these changes, Singapore will become Panasonic’s HQ for its refrigeration compressor business. 
  10. Thank you Panasonic, for your confidence in Singapore. 
    Transforming Manufacturing through Technology
  11. Panasonic is a shining example of how companies can transform and grow, and not fall into what I call the “black hole of global competition”.
  12. Technology is changing fast. Manufacturing technology is changing even faster. 
  13. While some are concerned that it will lead to job losses. Others are excited that it will lead to new job gains.
  14. It is debatable whether at the global level, job losses will outnumber job gains, or job gains will outnumber job losses. However, one thing for sure is that, technology will lead to redistribution of jobs and investments across the globe.
  15. Some countries will gain investments and jobs with technology, while some will lose investments and jobs without technology.
  16. For Singapore, the choice is clear. We are determined to be a winner in the world of future economy. We are committed to partner with technology to innovate pervasively across all sectors of our economy.
  17. This is so that all companies based here in Singapore (from global leaders such as Panasonic, to local SMEs regardless of their size) can capture new growth opportunities, here and overseas. Our journey towards a future economy of innovation and internationalization is well underway. 
  18. One key priority is the adoption of digital technologies – a core strategy highlighted by the Committee on the Future Economy.
  19. The use of digital technologies can help to connect and coordinate different activities in the manufacturing process, so that work is done in a more manpower-lean, efficient, and effective manner. 
  20. In this regard, Panasonic’s RCBU is a pioneer here in Singapore. In its new Smart Factory, machines are fitted with sensors to detect problems early, before the production line is disrupted. Machines can also talk to each other, to pass parts from one operation to another without human intervention. By gathering and analyzing all this data, human operators can work smarter and better.
    Better Jobs and Careers through Technology
  21. With this transformation, workers may ask: If my company becomes more manpower-lean, does that mean we are not needed anymore? Will we all be replaced by robots one day?
  22. I am glad that Panasonic shows us that while technology may replace some jobs, it can also create new and better ones. Over the past three years, you have upgraded your manufacturing process in phases to increase automation, with support from EDB. As a result, your operation has become more manpower lean. 
  23. Yet at the same time, our local workers were not retrenched, but retrained to work alongside these robots. 
  24. Instead of “Robotisation”, what we see here is “Cobotisation”, where workers and robots working together as co-workers. 
  25. With upgrading of skills and improvement in productivity, the median salary of your local staff has increased by 35% through this transformation.
  26. One of the workers who benefited is Mr. Ng Wee Teck. Wee Teck joined the company in 2001 as a technician. He did well by mentoring other technicians, and took the extra mile to understand production management principles. 
  27. When Panasonic upgraded its manufacturing process, Wee Teck was promoted to manage the robots in the production line. He was trained to troubleshoot and program the robots. He was also trained in higher-level skills like operations management. 
  28. He has done very well in upgrading himself. He shows that it is possible to Adapt & Grow - adapt to the new technology and grow in his career. Well done Wee Teck!
    Strengthening the Singaporean Core
  29. Some workers may also ask: as a company uses technology to create new jobs and better careers, will most of these jobs go to locals, or foreigners? 
  30. Again, I am happy to see that as a progressive employer, Panasonic has made it a priority to strengthen the Singaporean Core as it transforms and grows. 
  31. Panasonic has been grooming locals to take up leadership roles in the company, not just locally but also globally. 
  32. One such “glocal” talent is Mr Khoo Chew Thong. Chew Thong started the Singapore RCBU R&D department in 1988 from scratch. He has since built up a team of engineers and technicians undertaking the full range of compressor design and development activities, from product planning to regulatory compliance. 
  33. With the set-up of RCBU’s global HQ in Singapore, Chew Thong will be managing the business development of the RCBU group of companies worldwide, beyond the regional market. 
  34. In addition, he will also take on new responsibilities to manage intellectual property rights for RCBU. Congratulations, Chew Thong.
    Enhancing foreign-local complementarity
  35. Last but not least, some may ask: As we speed up the use of advanced technologies, what if we do not yet have enough local expertise in these new technologies? And if we have to bring in more foreign expertise to support this faster pace of transformation, won’t it weaken our Singaporean Core? Hence, why not slow down the pace until our locals are ready? 
  36. As an export oriented economy, it is important for us to recognize that the pace of transformation in Singapore’s economy is dictated not by our local readiness, but by global competition.
  37. As we run faster to stay competitive, some companies may need specific expertise which is currently lacking in Singapore. Without such expertise, they will not be able to grow their operations here to provide more good jobs for our people. 
  38. Hence, it is to our own interest to support companies to have access to global expertise where necessary.
  39. And at the same time, we will help our locals to learn faster and adapt better so that progressively, they can acquire the expertise and experience to take on more duties and responsibilities.
  40. In this regard, I am most encouraged by what Panasonic is doing to strengthen the complementarity of our local and foreign manpower. 
  41. Panasonic needs workers with skills in “advanced element design”, “process innovation” implementation, as well as “precision machining”, but could not find these locally.So, they had to bring in foreign expertise. 
  42. But they did not just stop there. These foreign experts helped to train and strengthen our locals to master these skills. As a result, our local workforce has become better, thanks to the progressive HR practices of Panasonic. 
  43. This is why I am pleased that together with EDB, NTUC and SNEF, we are able to recognise Panasonic as one of our Human Capital (HC) Partners when the programme was launched early this year. 
    Conclusion
  44. Panasonic has shown us how a progressive and responsible global company can come to Singapore and create win-win-win outcomes – for the company, our people, and Singapore as a whole. Using technology, we can improve the competitiveness of businesses, and improve the jobs, careers and wages of our workers at the same time.
  45. Panasonic and Singapore’s partnership is over 40 years old, but it shows no sign of aging because we never stop transforming, to stay young, and grow strong together. 
  46. I wish Panasonic every success in this exciting venture. You have been a valuable contributor to the Singapore economy for many years.
  47. We look forward to many more years of success in the future economy as partners, together.
  48. Thank you, Panasonic.