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ASMI - A Shared Purpose


ASMI - A SHARED PURPOSE

The Early Years
Meeting the Manpower Challenge
Developing a Quality Work-Force
Working Better, Working Smarter
Making Safety an Industry Watchword
A Shared Purpose


 

ASMI - A SHARED PURPOSE

THE EARLY YEARS

In 1968, key executives in the marine industry came together. They represented a mix of home-grown companies, joint ventures and government-backed enterprises, but they shared one common interest - to advance Singapore as a key maritime centre. The industry was in the midst of its biggest expansion as the government has mounted an all-out effort to develop its marine capability to create employment, on the advice of the United Nations team.

The 180-metre swamp land along the Geylang River was transformed into Singapore's first marine industrial estate for small boatbuilders and engineering workshops. Government-inspired Jurong Shipyard Limited (JSL) was steadily shaping up. Established in 1963 to repair larger ships which bypassed Singapore, JSL had almost breached the limit of its capacity. A 200,000-dwt drydock - twice the capacity of its first - was commissioned to allow JSL, to accommodate some of its largest ships afloat.

Government yard, the PSA Dockyard Department was privatized and renamed Keppel Shipyard in 1968. HM Dockyard Singapore, the predecessor of Sembawang Shipyard was converted from a naval dockyard to a commercial ship repair yard. Their businesses were put on a more competitive footing and internationalized. Facilities such as docks, workshops, cranes and equipment were also upgraded.

The heightened activities, with promises of more to come, raised hopes that someday soon Singapore would be one of the most modern and best-equipped shiprepairing and shipbuilding centres. An association was needed to foster closer ties among industry members.

In April 1968, the Singapore Association of Shipbuilders and Repairers (SASAR), was formed. It had 10 members - Cathay Shipbuilding, Eagle Engineering, Ho Ah Lam Boatbuilders, Jurong Shipyard, Kwong Soon Engineering, PSA Dockyard Department, Selco Group, Straits Engineering, Vosper Thornycroft Uniteers and Weng Chan Engineering. Together they represented a third of the shipyards in operations.

SASAR's initial intention was modest, to develop shipbuilding and repair and increase the export of Singapore-built ships and boats. As SASAR's first President, John Wilde, told members, "Any ship built or repaired in Singapore is a traveling advertisement of the Republic's highly specialized expertise to the world." In this regard, the Association would lend assistance to members to ensure that Singapore-built vessels became well known throughout the world for their workmanship.

From that humble beginning, the Association had grown in tandem with the growth of the industry, which developed at a frenetic pace following the closure of the Suez Canal in 1967. The closure triggered an exponential increase in ships and shipyards, and more marine support services. As European ships heading East could no longer stop at the Mediterranean in shiprepair, Singapore became the next available option.

By the time canal reopened in June 1975, Singapore has three very large crude carrier (VLCC) docks, and more were being planned. Also in place were specialists in electronic equipment repairs, underwater cleaning, turbo-charger reconditioning, refrigeration and airconditioning maintenance. The intensified search for oil in South-east Asia also created fresh opportunities for Singapore, given its proximity to the drilling sites. By 1975, there were five rigbuilders constructing drill-ships, drilling tenders, semi-submersibles and jack-ups.

Singapore shipbuilders also benefited from the offshore boom and expanding regional trade. They became the primary source for supply of ships, barges, anchor-handling tugs, hydrographic vessels, pontoons and general cargo ships. With the buoyant growth, Singapore soon became one of the most integrated centres in the world. As all the key players in marine construction and repair were of SASAR, the Association's membership grew, to reach a peak of 197 in 1983.

The recession in the mid-80s, sent tremours through the marine industry. Some companies closed while others scaled back, throwing an estimated 7,000 workers out of work. The downturn, which affected all sectors of the industry, prompted a major reassessment. "Because of the recession, the government realizes that very few of the local industries have the brand name to command a substantial premium in the market. Our competitive advantage is based on low cost," said Mr Choo Chiau Beng, ASMI President, 1989-1991.

"The shipyard whether shiprepair, shipbuilding or offshore, has been regarded as low value added per employee, but has been a consistent performer. It has also a lot of spin-off effects for direct suppliers such as bunker, lube oil and paint suppliers, ship chandlers, as well as the service industry - the airline, hotels and restaurants. The government decided that the marine industry is a good industry for Singapore. Shipyards are independent, owned and operated by Singaporeans, whether government-linked companies or private. Decisions to expand, contract or retrench are made in Singapore," said Mr Choo.

Since then, key government agencies have worked with the industry to develop new policy initiatives, which have allowed companies to remain competitive even against an appreciating Singapore dollar. Shipyards have also become more astute. "Before the recession, shiprepairers made a lot of money repairing VLCCs. With recession, they started to become more conscious of productivity. With the recovery, yards have become more discerning," said Mr Tan Mong Seng, ASMI President, 1991 -1995.

Shiprepair yards have broadened their base to include cruise ships and chemical and LPG carriers. In the key tanker sector, Singapore yards have gone beyond routine jobs. They have pitched and clinched higher value-added contracts involving life extension and conversion.

Since 1981, when the first tanker was converted to a floating production and offloading (FPSO) units, Singapore yards have completed well over 30 related contracts, making it the undisputed leader in FPSO conversions. Rigbuilders have also redefined their roles. rather than limiting themselves to drill rig constructions, they have evolved yards that build, repair and convert both onshore and offshore structures which can call on their heavy engineering capabilities. Singapore shipbuilders have moved up the value chain to build high-speed catamarans, container ships, cement carriers and product tankers for an international clientele.

As for SASAR, the Association has to re-invent itself after the recession took a toll on its membership. The leadership realized that SASAR could no longer afford to serve only the interests of shipyards. As marine engineering services providers, equipment suppliers and manufacturers, and design and consultancy companies were an indispensable part of the industry infrastructure, they should also be accepted as full members.

As SASAR President Loh Weng Siew told members, "This is a good time to recognize ourselves to represent the industry." However, it took a few years to rally members round. The prime concern was leadership. Shipyards, which formed the core membership of SASAR, feared that by putting non-shipyard members on par with the shipyards, with the right to vote each in an election, they might find themselves in the cold, a sentiment which Mr Loh did not share. "They won't want to rock the boat."

The constitution was amended in 1988 and the name changed to the Association of Singapore Marine Industries (ASMI). A new logo, an interlink of A S M I, was adopted. However, the intentions remained the same, to represent the interests of members, foster cooperation among them, and organize regular programmes to address issues on productivity, technology, skills upgrading and safety.


MEETING THE MANPOWER CHALLENGE

The leaders of modern Singapore began to develop shipyards in a big way in the 60s to create employment. Being labour intensive, shipyards offer more jobs dollar-to-dollar than any other sectors. The move paid off. By the mid-70s, Singapore came second to Japan in terms of Asian capacity, providing employment for well over 20,000 workers. Its early success helped to break the back of Singapore's unemployment problem.

Full employment, however, presented its own set of challenges. Staff poaching and spiraling wages became an issue at SASAR meetings. The industry was expanding. New companies were established and existing companies were building up to capitalize on higher demand. With the success of Singapore's industrialization programme, the marine industry also had to compete against the chemical, electronics and garment manufacturers for fresh entrants.

Mechanization, though possible, was slow as the marine industry was by nature labour intensive. The problem was overcome by employing migrant workers from neighbouring countries. The government introduced measures to manage and control the influx of foreign labour. Foreign workers' levies were introduced and the proportion of foreign workers capped in the government's phased withdrawal of foreign workers from Singapore.

The demand for workers became acute with the recovery. The industry's plea for understanding was given a sympathetic reception. The policy was moderated in 1987 as the government recognized that foreigners were needed to meet manpower shortfall in critical industries. However, shipyard managers were told to offer appropriate training to foreigners they recruited.

The foreign work-force has since become an integral part of the development of Singapore's marine industry. But Singapore companies have not let up in their efforts to recruit young Singaporean. Through scholarships and sponsorships, industry members have managed to attract their fair share of young Singaporeans who would form the next generation of managers to take the industry well into the next millennium.


DEVELOPING A QUALITY WORK-FORCE

Training began early in the 60s with the heavy build-up in facilities to equip workers for a variety and scope of work in a rather demanding environment. A systematic apprenticeship scheme was introduced as it was seen as a good means for the industry to avail itself of trained personnel. In conjunction with the Technical Education Department, SASAR formulated a five-year apprenticeship scheme which integrated institutional instruction with programmed on-the-job-training. The Association's effort was complemented by in-house training in Jurong, Keppel and Sembawang shipyards.

A polytechnic education was introduced at the Singapore and Ngee Ann Polytechnics to groom young Singaporeans for supervisory roles. Scholarships were offered to promising ones to pursue further education in universities in Singapore, the United Kingdom and Japan to prepare them for key roles in the industry.

Training did not lapse, not even during the industry slump of the mid-80s, though the focus was directed towards getting workers to be multi-skilled. The demand for training has intensified as foreign workers from non-traditional sources such as India, Bangladesh and Thailand are increasingly employed to supplement Singapore and Malaysia workers. ASMI has also assumed a greater responsibility of manpower development. For the rank and file, ASMI has worked with the Institute of Technical Education to develop the Public Trade Tests to train and certify workers' skills. Today, 15 trade tests, administered and coordinated by ASMI, are held regularly at the Institute and approved test centres.

The industry's effort received a shot in the arm in 1996 with the formation of the Marine Local Industry Upgrading Programme (Marine LIUP). In conjunctions with the Economic Development Board, the seven shipyards in the Marine LIUP - Keppel Hitachi Zosen Singapore, Jurong Shipyard, Keppel FELS, Keppel Shipyard, Pan United Shipyard, Sembawang Shipyard and ST Marine - have developed common programme for skills training for sub-contractor work-force.

By the year 2000, over 7000 workers from more than 50 local marine sub-contractor companies are expected to be trained. The successful implementation of this programme will advance the interest of the industry as sub-contract workers account for an estimated of 65% of Singapore's marine work-force of 26,000. There is much room to improve on the value-added per worker within the sub-contract workforce.

The benefits of Marine LIUP extend beyond participating members. "This is the first time we have adopted a cluster approach. We can test bed the programmes develop. Once they are proven to be useful and productive, ASMI can seve as a channel to proliferate these programmes to the marine industry." said Mr Chan Kah Guan, EDB's Head of LIUP Enterprise Development Division.

A number of generic on-the-job training programmes developed by the Marine LIUP are being used to upgrade the skills of older workers, many of whom joined the industry over 20 years ago as apprentices. Most tend to be specialized and their skills have never been certified. More programmes are being developed in ASMI's continuing effort to ensure that the workers remain relevant to the industry's needs. Skill standards are also reviewed to reflect changes in technology.

Avenues have also been created to allow capable employees to advance themselves. A two-year certificate course was developed in 1993 by Ngee Ann Polytechnic's Shipbuilding and Offshore Engineering Department and ASMI. This part-time course is designed for those with years of experience but have no proper paper qualification. In 1997, an Advanced Diploma programmed was introduced to allow the polytechnic graduates to scale-up. On completion, students can gain direct entry into the University of Strathclyde's final-year courses in Naval Architecture and Marine Engineering.

ASMI is also working with the National Trades Union Congress to tap funds from the Skills Redevelopment Programme to retrain workers, especially those who have been with the industry since its early years. "In time to come, we want to show our clients that we have a competitive edge because of our quality work-force," said ASMI's Training Committee Chairman, Mr Tan Kuet Pui.
 

WORKING BETTER, WORKING SMARTER

The search for improved methods began in 1982 with the government's intention to reduce workers from non-traditional sources. Some yards were already using CAD/CAM, numerically control burning machines, semi-automatic welding equipment and pre-blasted equipment for profile and plates to expedite work and enhance efficiency. However, the government felt that more could be done to enhance their operations.

SASAR members began by taking measures to improve their work processes. Production personnel, engineer and departmental and section heads from five major common shiprepair yards met fortnightly to draw up standard work procedures for certain common shipyard operations. By the end of 1982, they had developed 11 standard procedures covering work on LP and HP turbines, centrifugal pumps, cargo blocks, tailshaft, fair leaders, condensers, boilers, heating coils, universal rollers and main engines. These standards were promulgated to the industry for adoption.

A fresh attempt was made in the 90s on product and process developments. "After the recession there are no other yards in the world that repair more ships or bigger ships. What we need to learn from others, we have already learned. We were pushed to do our own R&D, to take technology available in other industries and apply it to the marine industry to improve the working environment and safety." said Mr Tan Mong Seng.

Together with the Productivity and Standards Board and the National Science and Technology Board, ASMI launched the Marine Technology Programmed (MTP) in 1995 to advance automation in shipbuilding and repair and develop new processes for enhance safety and productivity. Four projects were developed under Phase 1. These projects were computer-aided logistics management system, improvement of ventilation in confined spaces, automation of welding process and design of automation for marine/offshore installations of structures.

MTP has progressed to Phase II. With the benefits of experience, different parameters have been set for the selection of projects. "MTP II would concentrate on deepening and upgrading the technological capabilities with the ultimate aim of improving repair turnaround, lowering labour dependency and costs, and enhancing Singapore's competitiveness. Among the projects identified are stagings and pipe fabrication," said Mr Heng Chiang Gnee, ASMI President and Chairman of MTP II Steering Committee.

Staging is used extensively in shipyards. With improved materials and processes, significant cost savings can be made. The ability to remove and replace pipes quickly and efficiently will also lower costs bringing benefits for the shipyards and their customers.


MAKING SAFETY AN INDUSTRY WATCHWORD

Singapore shipyards began to pay closer attention to safety and safe practices in 1973 when the expansion of shipyards led to a concomitant increase in accidents. Between 1968 and 1972, accident rose 20-fold. An Advisory Committee on Safety and Health in Shipyards was formed under the Ministry of Labour to provide advice on measures which could curb and minimize accidents, SASAR provided feedback on new standards and policies, and played a key role in disseminating the safety measures.

A three-month safety and health exhibition was organized in 1975 and training courses introduced to drive home the safety message. A safety orientation was set up by SASAR at the National Stadium for small yards and sub-contractors in the Kallang/Tanjong Rhu area. The industry also instituted measures of self-regulation. In 1983, all contract workers were required to hold a SASAR certified safety permit issued on completion of the Safety Instruction Course, for entry into shipyards. Penalties were drawn up for safety infringement.

Safety issues have remained on the Association's agenda through good times and bad, for good reasons. Mr Loh Wing Siew, SASAR's President during its most tumultuous years recalled. "During my term, I was also the Chairman of safety for some years because I know we must put our house right. One of the key areas is safety. "Measures to promote safety awareness were stepped up so as to improve the safety standards of the industry. These efforts bore results and helped to enhance the image of the industry.

A review was undertaken in the early 90s, which resulted in the implementation of Safety Management System to help reduce accidents in shipyards. Under the Factories (Shipbuilding and Ship-repairing) Regulations 1994, all shipyards are required to establish the Safety Management System. The system is subject to an external audit to evaluate its effectiveness.

The audit is based on elements of the Safety Management Code, which was drawn up by ASMI with the assistance of safety consultant, TM Services. Comprising 13 elements, the Code provides a consistent framework within the industry. It covers organization, support systems, procedures and permit systems, training, contractor control, safety policy, promotion and emergency preparedness.

Even the best systems can falter because of negligence or a foolish act of bravado. "Regulations are regulations. We have to improve the mindset," said Mr Wong Peng Kin, ASMI Safety Chairman 1997-99. Two years ago, ASMI introduced specific themes, beginning with "Safety Is My Business" in 1997, followed by "Together We Work Safely" in 1998. Throughout the year, campaigns, competitions and seminars are centred on the theme to educate the work-force.

The accident frequency and severity rates may be off the highs, which may provide some breathing space for all concerned, but there is not let-up in the industry push to promote safety. "the whole issue of safety is dynamic. We are able to adapt systems, bring the rules up to date. We must continue to monitor when the situation changes or methods change." Mr Wong noted. Guidelines have to be developed for specific areas such as welding in workshops to forestall further accidents. Handbooks on painting, a potential health hazard in shipyards, has been published. By taking proactive measures and doing development work, ASMI is doing its level best to promote safety and health in shipyards.


A SHARED PURPOSE

Developments over the last 40 years have established Singapore as an international powerhouse for marine and offshore activities. On the 640-sq-km island is the biggest shiprepair centre in the world. Its rigbuilding yards are counted among the best. Singapore's shipbuilders are specialist builders for offshore and regional trades. Backed by a wealth of support services, they provide a critical mass unrivalled any other country in the world.

With increasing competition, however, new strategies are needed. "We will re-position for better differentiation, restructure for better competitiveness and regionalize for growth. In re-engineering, the industry will have to be innovative and search for better work methods and systems." said ASMI President Mr Heng Chiang Gnee. The process has begun. Industry majors are restructuring their operations - Sembawang Shipyard has merged with Jurong Shipyard, and Keppel Shipyard with Hitachi Zosen - to improve utilization of resources, enlarge their marketing network and enhance their market presence.

Singapore shipyards are also re-positioning to differentiate themselves from the competition. Shiprepair yards are accepting jobs with a greater engineering content to take advantage of Singapore's engineering capabilities and strong support services. Even in routine jobs, which Singapore continues to attract because of its location, shiprepairers are enhancing work processes to provide better quality work with faster turnaround. In rigbuilding, Singapore rigbuilders are going beyond fabrication to undertake research and development into new products to improve the capability of jack-ups and semi-submersibles. As for shipbuilders, they are looking at niche products and markets where Singapore traditionally has been able to compete.

Collectively, the industry is looking at re-engineering its production process. "We have to look at the things we have to do and how we can do it better." said Mr Heng. The on-going Marine Technology Programme will enable the industry to tap resources available from the tertiary institutes to seek solutions not so readily available off-the-shelf.

Given the constraints of land and labour, Singapore shipyards are regionalizing their operations to improve operational efficiency and expand their markets. With increasing global competition, the need for cooperation amongst industry members has also become more vital. As the industry's representative, ASMI is providing the catalyst to foster this cooperation. "The Association will have to help integrate the industry horizontally among those in the same business as well as vertically with the supporting services," said Mr Heng.

A sub-committee for Non-Shipyard Members was formed by the present Council in 1997 as the Association recognizes that the concerns for the non-shipyard members are different from the shipyards., but their effectiveness is equally important to the industry. "we are at the stage where the non-shipyard members have brought up their suggestions on areas of improvement and we are now seeing how solutions can be found so that they can be more efficient in executing their roles as a supporting industry," said Mr Heng.

The customer will benefit from it, and so will Singapore. "With the intense competition that is taking place, the main yards and no-yard members have come closer together to cooperate to secure business for Singapore." said Mr Frederich Peipers, Chairman of ASMI Sub-committee for Non-Shipyard Members. "We all recognize that resources are limited and have to be optimized. We should compete and yet cooperate. This can be achieved through a wilder exchange among the industry players and the pooling of resources to take advantage of opportunities for mutual benefits," said Mr Heng.

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