Powering the growth engine in manufacturing SMEs through standards
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Standards : Powering the growth engine in manufacturing SMEs through standards

Manufacturing is a critical component of Singapore's economy, contributing 21.5 per cent to the country's gross domestic product in 2020.

In the first 9 months of 2021, the manufacturing sector experienced an 11.9 per cent growth from 2020, thriving despite the supply chain disruptions caused by the pandemic.

The sector is expected to continue its growth trajectory, driven by strong global demand for semiconductors, healthcare equipment and precision-engineered products.

However, not all opportunities are equal. While large manufacturers can often capitalise on such growth opportunities, smaller SMEs may face hurdles due to the relative lack of track record and scale to compete effectively against their bigger counterparts.

More level playing field

How, then, can manufacturing SMEs bridge this gap with larger and established industry players?

Standards can be a way forward. They help to level the playing field, enhance manufacturing capabilities and penetrate overseas markets to bring their solutions to a wider pool of customers.

Standards ensure that all businesses providing the same type of products and services operate on a commonly agreed set of guidelines to meet minimum requirements.

By adopting standards, especially those that are compulsory to meet regulatory and safety requirements, smaller SMEs can provide the assurance that their manufactured products are of comparable quality to those from bigger players.

This means that smaller SMEs will be able to compete on a common basis of quality and use standards to establish trust in their capabilities, and allay concerns about their lack of track record.

Take local robot manufacturer Lionsbot, for example. Its robotic solution, LeoScrub, was the first professional cleaning robot to be certified to ISO 13482. The standard sets out safety requirements for the implementation of personal care robots.

Lionsbot was able to use the standard to enhance its value proposition with the added assurance that LeoScrub can be safely deployed to crowded public spaces, thus enabling Lionsbot to differentiate its product from other robotic cleaning solutions and secure business opportunities with both local and global customers.

Powering the growth engine in manufacturing smes through standard

Today, LeoScrub can be found at major local tourist attractions such as Jewel Changi Airport and the National Gallery, as well as in over 20 markets globally.

Building smarter factories with standards

Manufacturers are cognisant of the rise of Industry 4.0 as the next phase of transformation to enhance the efficiency of their production processes.

While many large manufacturers are already implementing Industry 4.0 technologies, adoption of such technologies tends to be slower among manufacturing SMEs, who often cite limited resources and a lack of knowledge on where to start as common barriers to entry.

Standards provide industry-best practices that can help companies overcome these limitations in their Industry 4.0 journey.

By getting their basics right, SMEs will be able to gradually incorporate smart manufacturing solutions to increase productivity and expand their capacities in the long run.

For those who are just embarking on Industry 4.0, the Standards for Industry 4.0 tool is a rich resource that can point them to the right standards that can support the implementation of their solutions.

Aligned to the Smart Industry Readiness Index (SIRI) Prioritisation Matrix, which assesses the Industry 4.0 readiness of manufacturers, the tool maps out solutions that companies should consider and guides them to the corresponding standards that are necessary to support their implementation of these technologies.

As they build their capabilities and solutions, SMEs can also leverage standards to identify technologies with the right specifications that can seamlessly integrate into their current manufacturing process.

This helps SMEs minimise the risk of incurring additional costs during the implementation of Industry 4.0 solutions, by ensuring compatibility and security requirements are factored in from the start prior to the acquisition of the solutions.

For instance, SMEs can adopt solutions that are compliant to SS IEC 62541, or what is commonly known as Open Platform Communications Unified Architecture (OPC UA).

OPC UA supports the exchange of data across machines and systems, which is a critical feature for automated production.

Global manufacturers and tech companies such as Microsoft, Samsung and Schneider Electric currently support OPC UA.

By adopting OPC UA, SMEs can ensure that the machines, sensors, controllers and cloud-based servers are scalable and can communicate seamlessly with one another.

New solutions to be adopted in the future can be easily integrated into the OPC UA compliant setup, thereby reducing the cost and resources required to address compatibility issues down the road.

As data exchange and connectivity of manufacturing systems intensify due to the adoption of Industry 4.0 technologies, SMEs should also leverage cybersecurity standards such as SS IEC 62443 to mitigate security vulnerabilities across their digital value chain and systems.

Powering the growth engine in manufacturing SMEs through standards - Manufacturing

The standard sets out best practices and requirements that are key for businesses to control cybersecurity risks across their manufacturing operations.

Facilitating manufacturing and trade overseas

Besides continuing to develop innovative products and upgrade their manufacturing capabilities, many manufacturing SMEs have also used standards as a competitive edge when it comes to exporting their products overseas.

This is the case especially for businesses that are looking to sell their products in developed markets with strict regulatory and safety requirements, such as the European Union (EU) and the United States. 

To meet these requirements, Singapore SMEs have to leverage standards to ensure the quality of their products prior to exporting to these markets.

One example is ForeFront Medical, a medical device manufacturer that is certified to ISO 13485 - a standard that assures the quality and safety of medical devices.

The standard is commonly referenced in medical device regulations of overseas markets such as the EU, Japan, Canada and Australia.

With the standard, products Forefront Medical manufactures can now be found in Germany, France and Switzerland. Currently, medical products sold in the EU comprise about 10 per cent of their overall revenue.

Amid the recovering and growing manufacturing sector, there is potential for SMEs to capitalise on the new business opportunities within.

By adopting standards to enhance their manufacturing capabilities and establish trust among their local and global customers, SMEs will be able to grow their business segments and one day, become established and formidable manufacturers themselves.

Looking to learn more about standards? Check out our three-parter on how standards can be the X-factor for your business – starting with a closer look at how standards even came to play such a big part in our lives.