Study shows that improving management practices is key to boosting productivity levels in Singapore companies

World Management Survey reveals that Singapore is ranked sixth for management practices among 22 countries just behind USA, Japan and Germany

25 October 2013 Skills, training and development

25 October 2013

The National Productivity and Continuing Education Council (NPCEC) announced today, key findings of the World Management Survey (WMS) in Singapore, conducted by the Council’s Policy, Research and Benchmarking Working Group. The announcement was made on the sidelines of the Singapore Manufacturing Federation (SMF)’s Singapore Innovation and Productivity Conference 2013, which was graced by Acting Minister for Manpower, Mr Tan Chuan-Jin. WMS aims to benchmark the management quality of manufacturing firms in Singapore against that of 21 other countries (refer to Annex A for background information on the existing study).
Conducted last year, the study assessed the management quality of 408 manufacturing firms located in Singapore. Using standard scoring criteria across countries, the study took stock of 18 management elements, classified into four dimensions. The dimensions were Operations Management; Monitoring Management; Targets Management and People Management (refer to Annex B for details on methodology).

Insights to Management Practices in Singapore Companies
The study revealed a relatively high overall management score for Singapore, which ranked sixth among 22 countries. The Republic’s performance is on par with other developed countries such as England and Australia, and is just behind top countries such as the United States of America, Japan and Germany (refer to Annex C for full country rankings). Singapore’s strong score can be attributed to the relatively large presence of multi-national corporations (MNCs) in the manufacturing sector in Singapore.
Of the four dimensions, Singapore’s firms achieved the highest ranking in People Management, coming in fourth among all countries surveyed. The Republic’s strength was in “rewarding high performance” and “retaining talent” – aspects under the People Management dimension which entail the optimising of workforce quality and maximising of human capital (refer to Annex D for chart on People Management).
Singapore also ranked among the top 10 among all countries studied for the other dimensions (refer to Annex E for charts on Operations, Monitoring and Targets Management). The favourable score in Operations Management can be attributed to the wide practice of lean manufacturing in Singapore. For monitoring management, Singapore managers were found to effectively identify employees’ weaknesses and send them for skills upgrading through training. With regard to targets management, Singapore managers were generally able to communicate well-defined targets to their employees.

Local SMEs encouraged to review its management practices
The study also revealed room for improvement within each dimension, especially for local SMEs. Some of these areas include instilling a talent mindset among senior management, better tracking and communicating of key performance indicators (KPIs) and setting goals that strike a balance between financial and non-financial objectives (refer to Figures 6 to 9 in Annex F on Singapore’s management practices performance for each element).
Local SMEs are also encouraged to review its management practices and boost productivity levels, as the studies showed that management quality is positively correlated with firms’ performance. This is similar to other countries, and was the case even after controlling for factors such as employee size, amount of physical assets, and other attributes of the firm (see Figure 10, under Annex G).
Mr Tan Chuan-Jin, who is also a member of NPCEC, said, “The findings suggest that firms in Singapore scored well in all aspects of management especially in promoting high achievers. However, more needs to be done for other indicators such as setting holistic targets. Good managers will be the forerunners for game-changing ideas which form the basis for the company’s next competitive advantage. Therefore, improving the quality of management is just as important as undertaking other productivity improvements in order to entrench a productive culture. It is against the backdrop of economic challenges that it has become more pressing, locally and globally, for SMEs to step up and review their business and management models.”

Joining hands to raise the game
The Government encourages all firms to professionalise their management through training and upgrading schemes. These include WDA’s Workforce Skills Qualifications (WSQ) Certified Productivity & Innovation (CPI) Manager and SMF’s SME Quality Initiatives to Assist, Nurture and Grow (SME QIANG) programmes. Larger firms are encouraged to join hands with SMEs to lift the overall standards and productivity of Singapore’s industries. For example, the Singapore Innovation and Productivity Institute (SiPi), a centre under SMF reached out to more than 200 companies to provide productivity advisory. SiPi has also assisted more than 40 companies in business diagnostics and productivity improvement projects.
More information on the WMS report and Mr Tan’s speech are at the national productivity portal, www.waytogo.sg.