Monday, February 26, 2018

Nature and its wisdom

Nature is wise and trees are a clear example of this. Although the roots are the least visible part, they are the anchor that keeps the tree upright and allows it to grow. The diversification of these roots allows adhering to the earth with more force. As in nature, in many cases, companies need to diversify to gain strength and continue to grow.

Today, thanks to Nikkei's interview to Vicent Chong, president of Singapore Technologies Engineering, we know the trajectory and future steps of a company that is a clear example of the power of diversification. In addition to specializing in the robotics and cybersecurity industry, it is beginning to focus on defense, going from focusing on domestic issues to becoming an important international player in the engineering sector.

ST Engineering is constantly searching for new opportunities suitable for M & A. As Chong says: "It can be robotics, smart city-related, cybersecurity-related, or it could be our core defense businesses as well if that helps us enhance our scale. For example, we invested in an airplane conversion business. We continue to invest, and as opportunities present themselves, we will acquire companies to strengthen the core businesses." Currently, at ST Engineering, they are investigating the incorporation of the mobile autonomous robot into its manufacturing process in its own production line of components for aircraft in Germany.

The most curious thing about Chong's company is that its growth is increasingly diversified, reaching to launch technology companies not related to defense, such as unmanned vehicles. Its objective is to be recognized as a technological power of defense and engineering. Its investment and position in areas of incredible growth and, in addition, are changing their way of growing, using open collaborations and innovations as the engine for this growth. According to Chong: "We have to find a way to tap into the engineering of the external ecosystem because the speed of engineering and innovation is moving very fast.

Regarding these collaborations, ST Engineering currently collaborates with local research institutions in different programs: cybersecurity and robotics. The total investment in these collaborations amounts to about 100 million dollars in Singapore. In addition, the company of Vicent Chong has opened innovation laboratories with which they have committed more than 30 million dollars in the next five years to incubate startups in urban solutions. Vicent Chong is committed to investing in innovation and new business: "Internally, we are developing an interesting technology. An example is the wheelchair platoons for airports, which require only one assistant to drive four or five wheelchairs. This will help alleviate the labor shortage at the airport. "

When Chong is asked about the challenges he encounters in the traditional defense business he turns the question over and answers "And what are your opportunities?" This is a great example of Chong's way of seeing business: "In 2012 we started exporting our defense technology when we sold some Warthogs, our armored vehicle, to the British Army. They have deployed in Afghanistan and protected the soldiers, which gives us confidence. When bidding for an amphibious combat vehicle contract for the US Marine Corps UU., We are one of the two finalists. The result will be available by the middle of this year and we hope that we win. ST Engineering started as a pure defense company." One could say that despite having part of the business specialized in cybersecurity and robotics, the defense business is the core of ST Engineering. As Chong says: "The key is to take advantage of the knowledge gained through the defense business and apply them to the side of non-defense."

Like nature, there are wise management groups that know where to expand their roots. This is the case of Vicent Chong, who is applying his knowledge to different sectors triumphing in all of them. Thanks to the interconnection between the different industries, diversification becomes simpler and necessary each time.


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