Singapore Government Press Release

Ladies and Gentlemen,

1. I am pleased to be here today for the opening of 3M’s new facility in Singapore to manufacture Microflex circuits. This project involves investment of over S$400m over the next 5 years. It is 3M’s first full scale manufacturing project in Singapore, and will also be largest plant 3M has built in a single phase.

2. 3M’s investment in this world-class facility is significant for Singapore for three reasons:

3. 3M’s investment supports EDB’s Industry 21 plan to make Singapore a vibrant and robust knowledge driven economy. Despite a tough environment, Singapore is working quietly and steadily to maintain and strengthen the confidence of international investors, and attract key high tech manufacturing companies to Singa-pore. In 1998, EDB managed to attract S$7.8 billion of investment commitments. EDB is targeting to sustain this investment level in 1999.

4. 3M’s Microflex Circuits manufacturing plant is a good example of a knowledge-intensive project. 3M itself is an excellent corporate example of how knowledge-based businesses thrive on innovation and technology.

5. Few companies have consistently maintained their standing and innovative spirit like 3M. It is one of America’s most admired companies. Stories of how 3M’s researchers have produced ingenious products, often as solutions to practical problems, are part of American corporate legend. For example, a 3M researcher, Art Fry, invented Post-it Notes. He was greatly frustrated by the way his scrap-paper bookmarks kept falling out of his church choir hymnal. In order to be able to flip quickly to the right hymn at the right point in the service, he came up with an adhesive note that would not damage the paper it was stuck to. It used an adhesive material which his laboratory had come up with, which refused to glue things properly and permanently together, and had therefore been deemed a failure. And so this indispensable piece of stationery was born.

6. But the success of 3M does not just depend on flashes of genius from its researchers. The issue is why their imaginations come alive under 3M’s roof better than elsewhere. How does 3M systematically nurture these sparks of brilliance, so that instead of being stillborn, they are developed into commercial winners? Peter Drucker captured this in his Harvard Business Review classic, entitled "The Discipline of Innovation". Singapore too is keen to nurture creativity under our roof. So we too are studying 3M’s experience, hoping to understand what it is that encourages the innovative spirit.

7. Central to 3M is the principle that "thou shalt not kill a new product idea". To encourage continual innovations, 3M’s corporate strategy calls for 30% of each division’s annual sales to come from products introduced in the previous 5 years. 3M has a 15% rule: it encourages scientists to take 15% of their time pursuing their own ideas, which can be ideas outside their own area of work. 3M also has a generous R&D budget, and an internal venture capital fund to support the fledgling explorations of researchers. The 3M culture allows innovators to thrive within the corporation. This attracts the best talent who want to work in such a company. The result is not just idle intellectual speculation, but day dreaming carefully guided to purposeful results.

8. 3M currently has 30 product development projects targeted at high growth industries, including Electronics, Life Sciences and Industrial & Consumer Sectors. Today, it has developed its own core technologies, with many more patents underway.

9. 3M’s track record of continuous success since the early 1900s illustrates how innovation can be the core of a business. It shows how a company can adapt to a changing environment and transition from industry to industry, as new industries are born and older ones die away. The key is a culture in which ideas, knowledge and methods transcend existing business boundaries.

10. Singapore must promote a culture of innovation in our own way. We are now tackling the twin challenges of encouraging an innovation mindset in our people, and of building a national environment that supports such a culture.

11. At this year’s World Economic Forum in Davos, Harvard’s Professor Michael Porter suggested that the national environment for innovation required a number of elements:

12. Every country hoping to compete in the knowledge-intensive economy needs these components to some extent. We must assess how we rate in each component relative to other countries, and how well we can integrate these factors into a coherent supportive national environment. Singapore already has in place some key infrastructure. We will improve on what we have, and fill the gaps where we are weak.

13. Government’s strongest influence will be in the area of supportive conditions for factor inputs:

14. Besides providing supportive conditions, the Government’s main contributions are to remove as many regulatory barriers as possible, and to ensure that its policies help the market to work efficiently and effectively. For in the final analysis, the entrepreneurial spirit, ability and drive must come from the private sector. Innovation depends on people with talent and courage.

15. The Govern-ment should improve our environment to encourage entrepreneurship. But the best environment is not a spoon-fed one, where the Govern-ment meets all the needs of would-be entrepreneurs and risk takers. It is one where firms compete fiercely against each other for capital, and face the rigorous discipline of the market. No US government financing schemes exist in Silicon Valley. Despite this, or more likely because of this, the Valley has one of the greatest concentrations of technopreneurs and risk takers in the world.

16. Like 3M, Singapore must stay relevant through many changes in technology and environment. I hope that 3M’s presence in Singa-pore will provide an example and inspiration to Singa-porean technopreneurs to dream dreams, reach for the sky, and by succeeding for themselves do well for Singa-pore.

17. May I congratulate 3M on the opening of your new facility.

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