ICA-IFFCO WORKSHOP OF SENIOR EXECUTIVES “CO-OPERATIVE ADVANTAGE OF DOING BUSINESS” Wellington, New Zealand Presented by Kelvin Quah Senior Manager Singapore National Co-operative Federation

Agenda Evolution of Singapore Co-operative Movement Evolution of Singapore Co-operative Movement What is a successful co-operative? What is a successful co-operative? Success factors Success factors Challenges Ahead Challenges Ahead Conclusion Conclusion

Singapore Co-operative Movement Introduced in 1925 Introduced in 1925 Focused mainly on thrift and loan facilities Focused mainly on thrift and loan facilities “Modernisation of the Labour Movement” by Singapore National Trades Union Congress (SNTUC) “Modernisation of the Labour Movement” by Singapore National Trades Union Congress (SNTUC) Many co-operative ventures launched to improve quality of life of members and community at large Many co-operative ventures launched to improve quality of life of members and community at large

Singapore Co-operative Movement Co-operatives serve members in areas of thrift and loans, insurance, supermarket, healthcare, eldercare, childcare, broadcasting, travel services, housing, security, training, job employment, campus services, home for the destitute etc Co-operatives serve members in areas of thrift and loans, insurance, supermarket, healthcare, eldercare, childcare, broadcasting, travel services, housing, security, training, job employment, campus services, home for the destitute etc Many of these major co-operatives have become household names Many of these major co-operatives have become household names

Global Village Competing operational environment Competing operational environment Advancement in technology Advancement in technology Present economy is increasingly dynamic and open Present economy is increasingly dynamic and open Co-operatives competing with public and private enterprises for share of economic pie and enhancing social mission to community Co-operatives competing with public and private enterprises for share of economic pie and enhancing social mission to community

What is a Successful Cooperatives? TWO levels of Success :- TWO levels of Success :- (1)Economic Success = Ongoing & Viable Business (2)Fulfillment of Social Missions & Objectives Need to DO WELL in order to DO GOOD Need to DO WELL in order to DO GOOD

Success Factors 1. Social Focus 2. Professional Management 3. Enhancing Information Technology 4. Customer Loyalty 5. Kaleidoscope Thinking

Social Focus Co-operative values give uniqueness and competitive advantage over private enterprises Co-operative values give uniqueness and competitive advantage over private enterprises Value-based management ensures business operations of co-operatives managed with a strong social conscience Value-based management ensures business operations of co-operatives managed with a strong social conscience Being a “people’s movement” brings about greater affinity between co-operatives and community Being a “people’s movement” brings about greater affinity between co-operatives and community Easier to garner loyalty and support from customers Easier to garner loyalty and support from customers

Social Report Card Measure co-operatives’ achievements on the social front Measure co-operatives’ achievements on the social front Social indicators measure the co- operative’s role in benchmark pricing, its reach and impact on society, and the privileges and benefits for its members and community at large Social indicators measure the co- operative’s role in benchmark pricing, its reach and impact on society, and the privileges and benefits for its members and community at large

Social Contributions NTUC FairPrice supermarket maintains a basket of 400 essential items at low prices and moderate prices and supplies during unforeseen or difficult situations NTUC FairPrice supermarket maintains a basket of 400 essential items at low prices and moderate prices and supplies during unforeseen or difficult situations NTUC Healthcare maintains a basket of 100 commonly purchased items at the lowest overall pricing NTUC Healthcare maintains a basket of 100 commonly purchased items at the lowest overall pricing

Social Contributions NTUC Childcare provides quality children services at affordable prices to help working parents NTUC Childcare provides quality children services at affordable prices to help working parents NTUC Income provides one of the lowest premium products in the market NTUC Income provides one of the lowest premium products in the market Co-operatives also contribute financially through providing donations and offering social programmes to the lower income Co-operatives also contribute financially through providing donations and offering social programmes to the lower income

Contribution to the labour movement - Support for NTUC and union activities Impact and reach - Benefit large number of workers Social programmes - Community out-reach Benchmark pricing - Moderate prices Benefits for members - Rebates, dividends, bonuses Account to public on our social role Measure social returns Social indicators : Measuring Cooperatives’ Values

Challenges In Meeting Social Objectives Cooperatives must first be viable, if they are to fulfill their social objectives on a sustainable basis

Professional Management Co-operatives flounder due to absence of professional teams to run Co-operatives flounder due to absence of professional teams to run “Listed company mindset” “Listed company mindset” Good corporate governance and a meritocratic system Good corporate governance and a meritocratic system Clear measurements and deliverables to be spelt out for management effectiveness Clear measurements and deliverables to be spelt out for management effectiveness

Harnessing Information Technology Embark on high tech ways to improve operational efficiency, bring down costs and better customize range of products and services Embark on high tech ways to improve operational efficiency, bring down costs and better customize range of products and services IT as an indispensable tool in helping co- operatives compete with global players IT as an indispensable tool in helping co- operatives compete with global players IT is no longer an option but a MUST for survival in this present competitive environment IT is no longer an option but a MUST for survival in this present competitive environment

Customer Loyalty Co-operative Model – “member-led” and “member-user oriented” Co-operative Model – “member-led” and “member-user oriented” Co-operatives enjoy an “automatic” customer base Co-operatives enjoy an “automatic” customer base Co-operatives should take advantage of membership database with effective data mining Co-operatives should take advantage of membership database with effective data mining Cheaper to retain a member/consumer than getting a new member/consumer Cheaper to retain a member/consumer than getting a new member/consumer

Kaleidoscope Thinking Way of creating patterns from fragments of existing data, resources, experiences and ideas available and then manipulating them to form different patterns Way of creating patterns from fragments of existing data, resources, experiences and ideas available and then manipulating them to form different patterns Many solutions and perspectives to a problem Many solutions and perspectives to a problem Bring about an innovative culture where staff will always be on the lookout for new ways of serving members Bring about an innovative culture where staff will always be on the lookout for new ways of serving members

Challenges Ahead Aim to be best-in-class for the business they are in Aim to be best-in-class for the business they are in Attraction of talents Attraction of talents Adopt best practices of good corporate governance Adopt best practices of good corporate governance Expansion of market base / Strategic alliances Expansion of market base / Strategic alliances

Conclusion Twin forces of globalization and advanced technology Twin forces of globalization and advanced technology Strike a balance between achieving economic success and performing social role Strike a balance between achieving economic success and performing social role Willingness to break away from conventional practices and reinvent ourselves Willingness to break away from conventional practices and reinvent ourselves Discard old practices and ideas which are no longer relevant Discard old practices and ideas which are no longer relevant

THANK YOU !