Singapore Introduces SG Digital Office and the Need for Digitalisation across Sectors

The SDO’s immediate mandate is to accelerate the adoption of digital solutions and cashless payment to meet the pressing needs of a nation coping with the work from home and social distancing regime wrought by the COVID-19 pandemic.

Digitalisation across all sectors

The creation of the SDO forms part of IMDA's wider strategy to digitalise Singapore. Evidently, this shows that to achieve a digital economy, all sectors and all aspects of the economy (including the community) must proactively embrace digital solutions and integrate them in their lives and work stream.

In the energy sector, digitalisation is important to keep our increasingly decarbonised and decentralised energy system functioning in a stable and affordable manner. We have highlighted some key updates on energy digitalisation in Singapore regarding new initiatives to digitalise the energy grid in our recent article here.

Other sectors where digitalisation may be imperative is the insurance industry. This may take the form of simplifying complicated insurance policies, streamlining approval processes, and providing digital offerings in various parts of the sales cycle (eg. apps, games and online quizzes). Forward-looking insurers may also consider the use of data analytics and artificial intelligence in their sales process, to analyse customer purchasing behavior and recommend products more tailored to the customers' needs. This provides a ripe opportunity to engage the increasingly tech-savvy customers, many of whom are already purchasing simple policies online, such as motor insurance, travel insurance and life insurance. By leveraging on digital solutions, insurers and other players in the sector can provide a more holistic and efficient experience for the customer, ultimately making the product easier to sell.

Commodity traders should also consider adopting digital solutions or they may risk losing out. The industry typically relies on extensive documentation and lengthy administrative processes like record-keeping and form-filling [2]. Although some of these processes have been digitised, they have not been integrated across the entire ecosystem and various functions operate on independent platforms that are incompatible with each other. This creates inefficiencies, increases the margin for errors and inconsistencies, creates delays and raises costs. It is therefore necessary that digital solutions not merely be adopted on face value, but be embraced and implemented in every part of the work stream to truly harness its power and reap its benefits.

Digitalisation for SMEs

As the creation of the SDO shows, small and medium enterprises (SMEs) must also embrace digital solutions. SMEs in Singapore are defined as businesses with annual sales turnover of not more than S$100 million, or employing no more than 200 staff. Another initiative by the IMDA is the SMEs Go Digital programme, to help SMEs use digital technologies and build stronger digital capabilities. Sector-specific guides, called the Industry Digital Plans (IDP), have been released to provide step-by-step guidance to SMEs on how they can digitalise at different stages of their growth [3].

In the waste management industry, an industry where many SMEs do not currently employ integrated digital solutions, the IDP provides a 3-stage roadmap for SMEs. The first stage of the road map is to digitise operations and enhance productivity, for example the use of fleet management services, refuse bin-fill monitoring and workforce management. The second stage is to integrate real-time environmental sensing to enable dynamic responses, such as dynamic routing of vehicles, and the use of autonomous robotic operations. Finally, the third stage is to exploit autonomous operations to maximize value, which includes the use of autonomous vehicles for refuse collection or street cleaning, and the deployment of autonomous robots to collect, transport and empty refuse bins.

Digitalisation may be challenging for SMEs which have been in the industry for a long time and have built their systems and processes around manual workflow, as a major overhaul of their infrastructure and operations may be required. However, there is really no turning back; although the upfront cost of digitalisation is high, failing to embrace digital solutions may prove even more costly for SMEs down the road or lead to obsolescence.

Facilitating digitalisation through regulation

As the push for digitalisation intensifies, businesses will need to concurrently be cognisant of pertinent legal issues that may arise from digitalisation. Crucially, these would be cybersecurity concerns and potential infringement of the applicable personal data protection laws. As Singapore's economy and community increasingly embrace digital solutions, these laws may need to be updated from time to time to reflect the precarious balance between over-protecting private citizens and individual liberties and an unchecked drive to innovate and deploy technology.

Instead of being a hindrance to the digitalisation process, it is crucial for regulation to facilitate innovation and pragmatic digital solutions. Likewise, businesses in all sectors of the economy, regardless of size, should constantly strive to harness the power of digital solutions and keep up with the international drive to go digital.

This article is produced by our Singapore office, Bird & Bird ATMD LLP, and does not constitute legal advice. It is intended to provide general information only. Please contact our lawyers if you have any specific queries.