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R&D investment turns S’pore manufacturing firm into multi-million business

SINGAPORE — Through research and development (R&D) efforts, a precision engineering firm in Singapore saw its revenue multiply, turning the small- and medium-sized enterprise (SME) into a multi-million dollar outfit.

Wavelength has invested about S$5 million in technology and R&D, of which S$1 million was spent on an 80sqm laboratory and a dedicated in-house clean room, which provides a controlled environment for research. Photo: Koh Mui Fong/TODAY

Wavelength has invested about S$5 million in technology and R&D, of which S$1 million was spent on an 80sqm laboratory and a dedicated in-house clean room, which provides a controlled environment for research. Photo: Koh Mui Fong/TODAY

SINGAPORE — Through research and development (R&D) efforts, a precision engineering firm in Singapore saw its revenue multiply, turning the small- and medium-sized enterprise (SME) into a multi-million dollar outfit.

From a group turnover of US$2.6 million in 2007, it made US$30 million (S$39.5 million) in total revenue last year. It also saw a 78 per cent growth in total consolidated revenue last year compared to the year before.

Wavelength Opto-Electronic was highlighted by Dr Koh Poh Koon, Senior Minister of State for Trade and Industry, as an example of an advanced manufacturing business which has seen substantial growth after stepping up its R&D efforts. He was visiting the firm in Bukit Batok on Monday (Feb 26).


Over the past decade, Wavelength has invested about S$5 million in technology and R&D, of which S$1 million was spent on an 80sqm laboratory and a dedicated in-house clean room, which provides a controlled environment for research.

The SME, which was founded in 2002, has patented products which allows it to secure more deals globally. One of these is its automated inspection system for contact lenses, developed with help from scientists at the Agency for Science, Technology and Research (A*Star).

The system, which was awarded a patent last year, reduces the time needed to check lenses for defects or flaws. It now takes fewer than three seconds to inspect one lens, compared to 30 seconds before.

 

TEAMING UP WITH A*STAR

Since 2007, Wavelength has been on the operation and technology roadmapping (OTR) programme offered by A*Star. This helped the company to develop long-term strategies for its business expansion plans, and it has also made a shift from producing loose optics components to manufacturing high-value products and services.

The programme helped the SME to identify future risks and solutions, and to analyse global trends and strategies to curb technological disruptions.

At the conclusion of the process in 2012, the company’s group turnover hit US$10.8 million. Since then, through continued collaborations with A*Star, the company has grown to have a workforce of more than 250 employees worldwide. In Singapore, it has 30 staff members — compared to fewer than 20 in 2012 — and most of them are Singapore residents, with eight involved in R&D work.

A*Star also gave Wavelength a leg up through its Technology for Enterprise Capability Upgrading (T-Up) scheme, which is meant to help the SME innovate, improve R&D processes and to identify new capabilities. To date, four researchers from the Singapore Institute of Manufacturing Technology (SIMTech), which is a partner in the scheme, have been seconded to Wavelength for this.

Mr Robert Huang, chief executive officer of Wavelength, said that the company invests 10 per cent of its total group revenue a year on R&D efforts.

“We are an SME. If we don’t invest, we will be behind even further. We have to keep investing (and have) a really good strategy.”

The company is now a leader in the laser and infrared optics market, which is a niche within the larger optics market.

It plans to move further into the consumer optics market, where optic and photonic technology innovations are happening. The technological developments offer the possibilities of diverse applications, such as in mobile phones with dual cameras.

“We see that the market opportunity is huge and has a huge potential… That is why we propose new projects, new markets,” Mr Huang said.

 

‘KEY PILLAR’ FOR ECONOMY

Speaking to reporters on Monday, Dr Koh said that for the upcoming Ministry of Trade and Industry’s post-Budget Committee of Supply debate, the Government will continue to “focus on efforts to help SMEs transform”. He did not give details, but said that the manufacturing sector continues to be an important and key pillar in Singapore’s economy.

Manufacturing was a leading contributor to Singapore’s gross domestic product (GDP) growth last year (at 3.6 per cent year-on-year), and the Government wants to keep it at 20 per cent of Singapore’s total GDP as it is now.

“This is a sector which, we believe, can continue to contribute good jobs for Singaporeans,” he said, adding that the sector employed 14 per cent of the total workforce as of last year, and “offers high-value jobs for Singaporeans”.

Singapore has a “very broadly and diversified manufacturing sector,” Dr Koh noted. It includes very high-performing high-value-added sectors such as precision engineering, and he singled out Wavelength as one such firm that has “done well”.

In 2016, spending for R&D in the precision engineering sector reached about S$313 million in value, a good 50 per cent jump from a year ago. This has led to more R&D job roles for research scientists and engineers, for instance, he said.

“These are the jobs that Singaporeans desire and it is good for us to continue to strengthen this ecosystem. Ultimately, what we want is for our companies to be more competitive.”

Productivity growth will depend on the kind of innovation and technology that these companies adopt, and “technology adoption is a must”. “A lot of automation needs to come on board” for precision engineering to thrive, because “it is something that is not just what human hands can do”, he added.

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