Insights

Innovation is Indispensable for Economic Growth

28 Feb 2018
Innovation is Indispensable for Economic Growth

In a world where economies are built around what is “new and improved”, it’s not enough to just keep up or do as the others do. From the earliest years following its inception, Singapore knew it had to find new and creative ways of getting things done, in order to get ahead.

Speaking at the Ministry of Trade and Industry Economic Dialogue 2016 held at the SMU campus, Minister for Trade and Industry, S Iswaran said that “skills must be complemented by a greater appetite for risk and tolerance for failure, especially in the context of innovation.” Singaporeans must be willing to venture into uncharted waters and embrace opportunities, and to stay resilient and flexible.

Acting on these words, the government has made it a point to make innovation a main focus of its development efforts. It sees innovation as necessary not only for succeeding on the world stage but also for making the most of the country’s limited resources, as well as for creating new businesses based on new products and services. Authorities have also affirmed innovation as the key to unlocking regional and global markets.

Building on its strengths, the country has encouraged innovation in industries such as aerospace, biomedical sciences, chemicals, energy, and manufacturing. This has facilitated efforts to attract major multinationals and foreign investors, as well as partnerships with companies able to impart skills and share technology.

Innovation has since succeeded in driving Singapore’s development.

Global studies say Singapore is one of the world’s top 10 most innovative economies which include South Korea, Sweden and Finland. Bloomberg, as well as Cornell University, Insead and the World Intellectual Property Organisation both say that Singapore is the sixth most innovative economy in the world.

The World Bank also says that Singapore is now the world’s fourth-largest exporter of high tech products behind China, Germany and the US. The most tightly packed entrepreneurial ecosystem in the world is likewise in Singapore according to The Economist, as is one of the world’s busiest ports—which can be seen in the country’s flourishing shipping and trade industries.

Singapore has likewise come to be the preferred Asian headquarters of American and European multinationals including several Fortune 500 companies across diverse verticals such as Apple, Unilever, Qualcomm and Shell. Companies from Japan, China, India and South Korea also choose Singapore as their regional base.

The Singapore Venture Capital and Private Equity Association says the country has attracted some USD1 billion in venture capital funding in recent years. The ventures of young entrepreneurs such as those behind Carousell, Grab, Hope Technik, Razer, and Sea might even be said to be shining examples of the fruits of Singaporean innovation.

Far from resting on its laurels, the country continues to nurture innovation to further its growth.

The results of the government’s recent five-year SGD19 billion-investment into research and development may be seen in the current number of scientists and engineers, which has more than doubled since 2000 according to the Agency for Science, Technology and Research (A*Star).

The Research Innovation Enterprise Plan 2020 (RIE2020) is another government initiative that supports innovation and encourages the adoption of new technology.

Industries that authorities have noted for their innovation potential include cell therapy, cleantech, chemicals, digitalisation, e-commerce and robotics. Examples of sector-specific government initiatives include SPRING Singapore’s Education Innovation Initiative, which helps private education SMEs to innovate in terms of curriculum design and delivery, administration and knowledge management.

The government has also focused its efforts on encouraging innovation in fintech, with both the Central Bank of Singapore and the Monetary Authority of Singapore (MAS) having already made significant investments into fintech development. Authorities have also made several international government cooperation agreements to foster fintech innovation in Singapore via technology exchanges.

Other industries where government support can be seen to support innovation include insurance, where data analytics and other digital developments are making a difference; and media and communications, which are expected to drive company growth and job creation.

Singapore is also looking at supporting startups as hotbeds of innovation.

With the push to develop technopreneurship, the Singapore Economic Development Board (EDB) works with other government agencies such as Spring Singapore and the National Research Foundation to give startups a helping hand.

Both startups and SMEs are seen as innovation providers and incubators for large local enterprises and MNCs. Indeed, it’s innovation that makes it possible for startups to grow into SMEs, and eventually into MNCs, with Garena and Razer as examples of companies that have developed in this manner.

The presence of many multinationals in Singapore has enabled innovative partnerships and collaborations between businesses in various industries. Some global financial services companies, for instance, have opened local fintech labs with the aim of implementing innovation into their business operations, while others have established other innovation centres for cybersecurity and blockchain technology.

International media companies who have been attracted by the government to work with local production houses and Singaporean professionals include Discovery, HBO, Industrial Light & Magic, and National Geographic.

The Ministry of Communications and Information (MCI) is working on creating an environment that encourages innovation among local media companies. The Info-communications Media Development Authority (IMDA), for example, supports Mediacorp’s Mediapreneur, an initiative that supports innovative media startups.

Education has a major role to play in fostering innovation in Singapore.

To be able to infuse and diffuse an innovative mindset, authorities are working on adjustments to the country’s educational system to encourage creative thinking, the very lifeblood of innovation. Secondary schools are now offering programmes for art, music, drama and dance, as well as robotics and environmental issues, in addition to the traditional focus on just English and maths.

At the higher learning level, SMU is one of Singapore’s local universities which has expanded its aptitude-based admissions to accept students who fall short of admission requirements but display ability and enthusiasm.

As innovation shows no signs of slowing down in the near future, Singapore’s workforce will need to continually update its skills to be able to contribute to the country’s innovation-driven economy. SkillsFuture, which emphasises competency rather than qualifications, ensures that both local and overseas businesses will always be able to find highly skilled Singaporean workers.

Against this backdrop, SMU Academy offers a Graduate Certificate in Innovation which aims to encourage corporate managers, entrepreneurs and practitioners to advance innovation in their fields. Participants learn to use Design Thinking as an innovation management tool, the organisational aspects of making innovation work, and how to build an innovation portfolio.

Other course modules include Opportunity Recognition & Ideation Management, Turning Innovation Concepts into Business Cases, and Evaluating New Business Ideas. Completion of the Certificate leads to a Master of Science degree in Communication Management. Ask for complete course details at academy@smu.edu.sg, or contact SMU Academy, today.