Organisations and Workers Benefit from Best Sourcing Initiative (BSI)
05 November 2009
Media Release
Top up of BSI Early Adopters Scheme to $5 million to encourage more organisations to adopt BSI
1 Since the launch of the Best Sourcing Initiative (BSI) Early Adopters Scheme (BEAS) by the National Trades Union Congress (NTUC) and Singapore Workforce Development Agency (WDA) on 29 July 2009, more organisations have adopted the best sourcing practice. A total of 64 contracts with a total value of $125 million have been evaluated for the BEAS incentive grant. To-date, $900,000 BEAS incentive grant, almost half of the $2 million scheme, has been awarded to 11 organisations.
2 Encouraged by the high take-up rate of BEAS grants, and hoping to attract more organisations to embark on BSI, WDA is allocating an additional $3 million funding to BEAS. The grant will continue to be administered by e2i (Employment and Employability Institute) and Unit for Contract and Casual Workers (UCCW) of NTUC, who have been working closely with industry players to adopt best sourcing of cleaning, building maintenance, security and landscaping services. More details on BEAS can be found in the enclosed Fact Sheet.
3 With BEAS, buyers are incentivised to award contracts based on performance and quality, also known as a beauty contest evaluation method, instead of solely on price. By so doing, buyers will come to realise that while the cost of contracts may go up in the short term; in the longer term, they will receive better value for money as the higher service quality will more than offset the increase in cost. Henceforth, a key consideration in awarding BEAS grant is Page 2 of 7 whether the contract contains features that will drive sustainable performance and productivity.
4 “Singapore cannot compete just on cost alone because we are not a cheap country. We must have the capability to produce and deliver high quality products and services in a smart and cost-efficient way. That is what the Labour Movement meant when we made the call for everyone to be Cheaper, Better and Faster (CBF). And BSI is one small step towards achieving CBF,” said Mr Ong Ye Kung, Assistant Secretary-General of NTUC and Chairman of e2i.
5. Workers will also benefit when organisations are on BSI because when service providers focus on delivering quality services instead of offering the lowest price, they will invest in the training of workers and provide them with proper terms of employment and benefits, including CPF contributions.
6. Mr Zainudin Nordin, Director of UCCW, NTUC, said, “With BSI, when organisations have to compete on quality instead of cost, they will have to look at boosting workers’ productivity by up-skilling, re-skilling or multi-skilling them through training and job re-design or re-creation,” He added, “The CBF economy has to be driven by an inclusive workforce. We believe that BSI will allow our workers, including the contract and casual workers, be more productive with better job performance, not lower wages; as well as be more competent and adaptable.”
7. To proliferate the adoption and benefits of best sourcing, e2i, UCCW and WDA held a BSI Symposium this morning, which was attended by about 500 participants, mostly from the private sector. The symposium featured successful early adopters of BSI, such as the Changi Airport Group (CAG), National Parks Board, National Environment Agency, Wing Tai Holdings and Holland-Bukit Panjang Town Council, who shared how they implemented and benefitted from Page 3 of 7 best sourcing in their organisations. Annex A contains more details of BSI at CAG and Wing Tai Holdings.
8. Mr Chan Heng Kee, Chief Executive Officer of WDA said: "We have increased the funding for BSI early adopter scheme to $5 million to encourage more organisations to adopt best sourcing. This will be a win-win for all parties, with buyers benefiting from more professional service standards; workers enjoying better training, job prospect and rewards; and service providers being able to also compete by quality and performance. Through the symposium, we hope more organisations will be inspired by the success of the BSI early implementers, and tap on the available funding to begin their journey on best sourcing.”
