Techblog
Singapore Budget 2017: Strategies to help SMEs navigate economic uncertainties in the future
How can SMEs ensure that they survive and stay relevant in an uncertain environment that is being constantly disrupted? The government recommended several strategies that businesses should undertake to stay ahead.
The Singapore government emphasised the need for SMEs to remain open and well-connected to the world. The importance of innovation was also heavily reinforced in the report that was release last week.
This report was released last week by the Committee on the Future Economy (CFE), which is made up of five Cabinet ministers and 25 members from the private sector. It was also stated in the report that the recommendations, if well-implemented, should help the economy to grow an average of 2 to 3 per cent per year.
So what are these recommendations – and what does it mean for SMEs? We summarise the key recommendations below.
Deepen and diversify our international connections
The report emphasised the need for businesses to continue developing strong international connections and seek opportunities in newer markets – especially around the region.
To do so, the government said that it will do its part by encouraging trade and investment cooperation and reducing tariff and non-tariff barriers through the ASEAN Economic Community and the Regional Comprehensive Economic Partnership.
However, businesses have a role to play as well. Businesses need to acquire deeper knowledge of international markets – especially those in the region. The committee said this is only possible, if business leaders spend quality in these markets.
Acquire and utilise deep skills
The CFE is recommending that more short-term learning courses should be offered to existing employees within a company. This allows employees to increase their capabilities without a disruption to their professional or personal commitments.
Businesses should ensure that employees who have gone through training programs use their skills promptly. This means that training should be related to their job requirements.
Strengthen enterprise capabilities to innovate and scale up
Improving the capabilities of the workforce here is key to creating a “a strong core of competitive, Singapore-based enterprises” that can attract investment, said the report. CFE recommended that “high-growth” enterprises with more customised support so they can further expand overseas and emerge as leaders and pioneers within their fields. These “high-growth” businesses will be selected based on their potential. As such, these businesses need to have strong leadership, a clear plan and growth strategy.
SMEs can also expect a stronger intellectual property ecosystem, which was a recommendation made in the report. Local start-ups can also expect more support that will help raise their profiles. Businesses here can also look forward to simpler regulation and incentive schemes that will encourage greater investment.
Build strong digital capabilities
The report further builds on Singapore’s Smart Nation vision by emphasising that SMEs need to take advantage of opportunities presented by the digital economy. How can they do this? It is key to adopt technologies and build strong digital capabilities to improve productivity and tackle other challenges. SMEs will receive help from the government so that they will be encouraged to adopt digital technologies. The support can come in the form of expertise or financing support.
SMEs should also improve how they harness data. It is recommended that the government establish a specific programme that will help support businesses in making the most of data as an asset.
Partner one another to enable growth and innovation
To thrive in an increasingly uncertain environment, collaboration is key, states the CFE report. It is therefore important that SMEs, government agencies, and Trade Associations and Chambers (TACs) come together to come up with unique, innovative solutions to tackle industry-wide challenges in a rapidly-changing economy.
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Training is required to keep the workforce and their skills relevant. SMEs are recommending more short-term courses that doesn’t disrupt employees’ professional or personal commitments. Courses should also be relevant to employees’ job requirements.
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Government will offer more support to high-growth enterprises. It will also work at supporting local start-ups by strengthening the intellectual property ecosystem.
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SMEs, with the help of the government, should take advantage of opportunities presented by the digital economy to reach out to a more global market.
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Collaboration between government agencies, TACs and especially SMEs is key to identifying and coming up with solutions to tackle industry-wide problems.