Ladies and Gentlemen

Good morning

A warm welcome to all of you, especially our speakers and friends from overseas. I understand that some 600 participants from 11 countries are taking part in the Exposition this year. To all the foreign delegates, I wish you a pleasant and enjoyable stay in Singapore.

This year marks the 18^th year that this international event for quality circles or QCs has been held in Singapore. It was initially started in 1984 to give workers who are active in QC activities the opportunity to interact and learn from their counterparts in other parts of the world. It has now blossomed into a full scale Conference with plenary speakers, QC presentations and an international QC competition. The large turnout for this year’s Conference is a clear indication of the worldwide interest in QCs. It also shows that the QC Movement is very much alive and vibrant.

In Singapore, the QC Movement has become a mass movement involving some 221,000 workers or 12.3% of the workforce. More than 27,000 circles from 410 organisations are registered with the PSB. They are found in all sectors of the economy, including schools, hospitals, government departments, the armed forces and even golf clubs.

The importance of QCs cannot be underestimated. Over the years, QCs have proven to be an important tool to harness employee involvement in their organisation’s productivity improvement effort. The QC activities help to break down barriers that hinder creativity. Working in small groups enables employees to bounce ideas off one another and facilitate a freer exchange of ideas. Some of these ideas had resulted in quantum leaps for their organisations and breakthrough improvements. This is seen in the savings of some $61 million reported by the participating circles in this year’s National QC Conventions.

QCs have also contributed to improved teamwork, better co-operation and mutual understanding at the workplace. Nurturing this kind of "heartware" is as important as the development of hardware at the workplace. At the workplace, QCs provide an excellent platform for injecting the element of enjoyment into work while allowing innovative ideas to take root.

What about the future? How should the QC Movement respond to the new economy? As countries progress from the resource driven stage to the knowledge and ideas-driven stage of economic development, innovation will become the key driver of long-term economic growth. The accelerating pace of scientific and technological change, the evolution towards a globally integrated economy and changing market demands are some fundamental forces shaping Singapore, as well as other economies throughout the world.

While QCs have contributed much in developing our workforce to support economic growth, they also have to evolve so that they can continue to be a potent force in the new knowledge economy. Although quality improvement and problem-solving skills are still important, creativity and innovation have become critical qualities in a knowledge-based economy. Businesses, including traditional ones, can continue to prosper only if they are able to create value for their customers. Companies have no choice but to focus on increasing their innovative capacity and create value for their customers to enhance their competitive edge.

QCs will thus have to expand their scope beyond quality improvement to innovation and value creation. Only then will QCs continue to be relevant and make a difference to their organisations in the new economy. This is the position that Singapore will be adopting over the next decade.

As the national body championing quality circles in Singapore, PSB has spearheaded moves to transform QCs into Innovation and Quality Circles or IQCs. Unlike traditional QCs, which comprise workers from the same section, IQCs are cross-functional teams with members drawn from different departments. They work on value creation projects, using innovative techniques and tools, and complete their projects faster than traditional QCs.

PSB has adopted three strategies to transform QCs into IQCs. The first strategy is to inculcate in QC members an innovation mindset. Among others, PSB will be introducing an IQC communication website in February 2002 to reinforce the innovation mindset. Besides providing information on new QC developments and best practices, the website will serve as a conduit for QC members to interact and exchange experiences. To promote innovation, the "Eureka" award was introduced last year to recognise QCs that have developed innovative solutions for their projects. This year’s applications for the award saw an increase of 30% over last year. More QCs are coming out with innovative solutions for their projects.

The second strategy is to impart new tools and techniques in creativity and innovation to QC members through workshops and courses. To date, some 4,500 QC members have been trained at such workshops and courses.

The third strategy is to reconfigure the QC structure so members can come from other departments or even suppliers. This cross-functional structure enables members to interact with one another to draw out ideas from a cross-section of the organisation.

To increase the formation of cross-functional circles, PSB embarked on a joint pilot programme with Philips Electronics Singapore Pte Ltd (Domestic Appliance Products). The Philips factory, which won the Singapore Quality Award last year, serves as a mentor to nine organisations, sharing its expertise and experiences on nurturing cross- functional teams. Some 2,500 QCs from these organisations will be converted into cross-functional circles. These organisations could then become mentors to others, triggering a multiplier effect.

The QC Movement in Singapore was based in its early days on the Japanese model, which emphasises sectional teams and problem solving. As these principles and practices are deeply ingrained in our QC members, it will be some time yet before we can bring about a complete transformation of all our QCs into IQCs.

However, the progress achieved so far has been encouraging. The more active organisations are taking the lead in re-organising their QCs into IQCs. As a first step, they are gradually converting their sectional QCs into cross-functional circles and training them in creativity and other related tools. These will help the circles to identify value creation projects and develop innovative solutions.

There are already positive signs pointing to the growth of IQCs. At this year’s National QC Conventions, one in five circles that presented projects was a cross-functional team. Some of these cross-functional circles worked on projects that created value exceeding $1 million for their organisations.

The effort to transform QCs to IQCs has led to significant improvements in the types of QC projects that were submitted for this year’s National QC Awards. Let me cite two examples.

The first example is a QC from the Singapore Civil Defence Force. Comprising staff from the various units of the Singapore Civil Defence Force, the circle embarked on a project to improve the mode of fire fighting. The team found that during the course of common household fire-fighting, large streams of water from the big hoses and nozzles often cause unnecessary damage to the property that are not directly connected with the fire. The water also contaminates evidence that could help in the investigation of the fire. The team members pooled their expertise to design and develop a portable watermist system, which can extinguish the fire quickly and with minimum damage to unconnected property. For its achievement, the circle won the Eureka Award, presented to circles for innovative projects.

The second example is a team from Advanced Micro Devices Singapore’s Maintenance Test Support Group. This team is a winner of the Million Dollar Project Award – an award that is presented to circles that have achieved more than one million dollars in savings from a single QC project. To improve the productivity of the high-end semiconductor-testing product, the team introduced an effective process, which extended the life span of the IC testing device, resulting in improved performance and cost reduction. As a result, the team helped Advanced Micro Devices save some US$3.7 million.

Management plays an important role in sustaining QC activities. Without top management’s active interest and encouragement, the QC movement will not flower. One example is the winner of the Outstanding QC Organisation Award - TIBS Holdings Limited. TIBS is a diversified group of companies engaged in providing public transport, including buses and taxi services. So important are QCs to TIBS Holdings that the Managing Director, Tan Hup Foi personally leads the QC Movement and chairs the Steering Committee. The senior managers participate actively, serving as facilitators to guide their QCs and to align all quality efforts to business goals. TIBS is gearing up to introduce more cross-functional teams. To provide for a more systematic and comprehensive corporate overview, a computerised system was developed to allow QCs to record their monthly progress reports online. With top management support, QC in TIBS had produced many good answers and results.

The success of quality circles in Singapore is also due in no small measure to the leadership and strong support of key employees. These are the QC facilitators and leaders who have put in much time and effort to strengthen and sustain QC activities over the years. One of them is Ms Cecilia Ong Bee Tin from the Defence Science and Technology Agency (DSTA). Ms Ong was a QC facilitator who played a pivotal role in developing new strategies to sustain staff interest in DSTA’s QC Movement. The QC participation rate in the organisation has been maintained at 100%. Under Ms Ong’s stewardship, DSTA has won many awards. The most recent examples are the Ergo QC winning the Eureka Award and the Goodness QC winning the Million Dollar Project Award this year. In recognition of her contribution, Ms Ong will be presented the Outstanding QC Manager Award.

I would like to congratulate all the recipients of the National QC Awards. I hope the recognition will spur them to attain greater heights. Time permits me to cite only a few examples of the winners. I know there are many others, including today’s award winners, who have successfully helped their organisations to achieve higher productivity and better teamwork among their fellow workers. I am sure that similar examples can be found from the other countries taking part in this year’s IEIQC which is meant to showcase not only QC projects from Singapore but also from other countries.

On this note, I wish all of you a rewarding experience at this exposition.