Lim Say Leong 10 April Dilemma of local SMEs Overcome constraints of labor, energy costs, and global competition

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1 Lim Say Leong 10 April 2013 Dilemma of local SMEs Overcome constraints of labor, energy costs, and global competition

2 This session will share how world-leading companies in power and productivity can help local manufacturing Er. Lim industries Say Leong to conquer the latent barriers through the use Assist of V robotic P, Marketing ABB applications, developing total solutions, and having reliable local and global presence April 11, 2013 Slide 2

3 Power of productivity Productivity - the goods and services produced from each hour of work - is the magic elixir of economic progress. It's why we live better than our grandparents did, without working longer hours. Alan Greenspan, Ex-Chairman of the Federal Reserve of the United States April 11, 2013 Slide 3

4 How is productivity in Singapore Economic survey of 2011 Over the past decade, Singapore s economy grew on average of 5% p.a. Singapore s productivity grew on average 1% p.a. Broad majority of Singaporeans enjoyed real wage growth and a rise in living standards. Productivity gains declined due to heavier reliance on labour inputs to generate economic growth, especially inputs of foreign manpower. Productivity is the only sustainable way to increase our value-add and grow our incomes. Government focus on helping and supporting businesses and workers improve their productivity. April 11, 2013 Slide 4

5 Productivity and wage growth in Singapore Economic survey of 2011 Link between productivity and wages based on: productivity growth; relative output price changes; and growth in labour share of output. April 11, 2013 Slide 5

6 Economic survey of Singapore 2011 April 11, 2013 Slide 6

7 16 priority sectors identified by MoM Construction Electronics Precision Engineering Transport Engineering General Manufacturing Retail Food & Beverage Hotels Healthcare Info-comm, Media and Design Logistics and Storage Administrative & Support Services Financial Services Accountancy Social Services Process Construction & Maintenance Selected based on their potential for productivity enhancements. Collectively, they contribute approximately 55% of Singapore s Gross Domestic Product (GDP) and around 60% of employment. This sectoral approach is complemented by horizontal productivity enablers such as the adoption of infocomm technology and CET. A $2 billion National Productivity Fund (NPF) was also established to support the productivity strategies April 11, 2013 Slide 7

8 Good news ABB has now success stories to share in Singapore April 11, 2013 Slide 8 Source: SPRING NEWS

9 So many goodies Yet many are not starting Intent to Start a Business and Attitudes towards Entrepreneurship Global Entrepreneurship Monitor (GEM) 2011 Singapore Report Olexander S. Chernyshenko, David Gomulya, Wei Ming J. Phan, Yoke Yong Lai, Moon-ho R. Ho, Marilyn A. Uy, Kim Yin Chan & Olwen Bedford. (2012) Global Entrepreneurship Monitor 2011 Singapore Report. Singapore: Nanyang Technological University Singapore ranked 5th out of the 24 comparison countries in intending to start a business 15.3% within the next 3 years Singapore ranked 17 th out of the 24 comparison countries for a fear of failure that would prevent them from starting a business and the main reasons for why more Singaporeans are not engaged in the entrepreneurial activities: the perceived lack of skills and opportunities to start a new business. Not only did Singapore rank among the lowest on both of these indicators, but there was also little or no improvement from the 2006 rates. April 11, 2013 Slide 9

10 Global competitiveness index Singapore in April 11, 2013 Slide 10

11 The global competitiveness index framework Singapore retains 2nd position - a result of an outstanding performance across the entire Index. The country features in the top 3 in seven of the 12 categories of the Index and appears in the top 10 of three others. Its public and private institutions are rated as the best in the world for the fifth year in a row. It also ranks 1st for the efficiency of its goods and labor markets 2nd in terms of financial market development. Singapore also has worldclass infrastructure (2nd), with excellent roads, ports, and air transport facilities. Reinforced by a strong focus on education and providing individuals with the skills needed for a rapidly changing global economy. April 11, 2013 Slide 11

12 Overall equipment effectiveness - OEE Knowing how the others are measuring Overall Equipment Effectiveness (OEE) is a way to monitor and improve the efficiency of your manufacturing process. Developed in the mid 1990 s, OEE has become an accepted management tool to measure and evaluate plant floor productivity. OEE is broken down into three measuring metrics of: Availability Performance Quality. These metrics help gauge your plant s efficiency and effectiveness and categorize these key productivity losses that occur within the manufacturing process. OEE empowers manufacturing companies to improve their processes and in turn ensure quality, consistency, and productivity measured at the bottom line. OEE is the calculation of Availability, Performance, and Quality. OEE = Availability x Performance x Quality April 11, 2013 Slide 12

13 Make the move and change business methodology Break the myth and fear of using robot Everyone saw it coming and maybe did not know what to do. No, I think they know what to do. Dilemma??? April 11, 2013 Slide 13

14 Jason Y L Chang MD and Founder Pacific Forest Pte Ltd April 11, 2013 Slide 14

15 Going green too We acknowledge his foresight, innovation.passion April 11, 2013 Slide 15

16 What are the dilemmas During this hard time of uncertain economy recovery and high cost for labor energy costs operation excellence In order to remain competitive and stay in business. It sounds like an impossible task. To go for automation could be seen as threatening by existing workers, because they expect not to be replaced by machines Thus this change in total attitude shift is important for the industry. I think it late to recognize the value that improved enhancements through automation can bring to make industry more productive and competitive. But not too late! April 11, 2013 Slide 16

17 Top 10 reasons for robot investment Increase production output rates Reduce operating costs Improve process quality Improve workplace health & safety Increase product manufacturing flexibility Reduce material waste and increase yield Reduce labour turnover and difficulty of recruiting workers Save space in high value manufacturing areas Reduce capital costs (inventory, work in progress) Improve quality of work for employees April 11, 2013 Slide 17 Based on research carried out by the International Federation of Robotics (IFR) For video; Please visit to Youtube for ABB robots.

18 One more reason to go the robot way Is it a choice? April 11, 2013 Slide 18

19 Safety Like any manual work there will be particular hazards which exist in automation systems incorporating manipulating industrial robots. Hazards are well recognized but the sources of the hazards are frequently unique to a particular robot system, the type of robot used and its application and the way in which it is installed, programmed, operated and maintained and type of safety devices installed. In recognition of the variable nature of hazards with application of industrial robots, ABB provides guidance and training for the users and the system integrators to give assurance of safety in design and construction of robots. April 11, 2013 Slide 19

20 Productivity and safety go hand in hand April 11, 2013 Slide 20

21 Protection layout of a robot cell April 11, 2013 Slide 21

22 The Factory Act Chapter 104 April 11, 2013 Slide 22

23 10 common industries to apply robot Arc welding Spot welding Material handling Machine tending Painting Pick, packing and pelletizing Assembly Mechanical, cutting, grinding, deburring and polishing Glueing, adhesive sealing & spraying material Inspecting, waterjet cutting, soldering, etc April 11, 2013 Slide 23

24 Markets served Overview Automotive Plastics Foundry & Forging Metal fabrication Food & Beverage Chemical & Pharmaceuticals Wood Machine Tools Consumer electronics Solar April 11, 2013 Slide 24

25 Other industries served Building materials Defense & Aerospace Glass products Sanitary/Tableware/Ceramics Railways April 11, 2013 Slide 25

26 Robotic application center in ABB Singapore Is here to help you increase productivity April 11, 2013 Slide 26

27 Factory automation solution based on PLCs, robots, drives, wireless sensors, LV products and instruments AC500 CPU Modbus on AC500 COM2 AC500 as DeviceNet Slave Connected to IRC5 robot controller AC500-eCo CPU Profibus on AC500 HMI WISA Level Pressure Flow ACSM1 ACS550 ACS800 Tmax MCB UMC Motor Softstarter Controller April 11, 2013 Slide 27

28 Recap on benefits Different and versatile way of mounting the robots Lighting and temperature only for material and equipment needs. Hygienic level increased Safety level enhanced People to be retrained and redeployed April 11, 2013 Slide 28

29 Key takeaways 1. Intense global competition; shift from west to east is accelerating. 2. More needs to be done to improve the productivity growth of domestically-oriented sectors for sustainable wage growth 3. Complex inter-play of factors within each sector, and they are driven by change in fundamental, namely technological, social, and demographic. April 11, 2013 Slide 29

30 Future Applications The keys areas to be explored for robot applications for immediate future are: The building industry The marine industry Construction and marine industry High mix, extreme low volume April 11, 2013 Slide 30

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