Firms future-proofing their businesses amid uncertainty: SM Teo

They are diversifying to ride out disruptions to supply chains, prepare for climate change

- Sue-Ann Tan

Businesses and governments are increasingly operating on a “just in case” basis in an uncertain global environment, said Senior Minister Teo Chee Hean on July 24.

His remarks, made on the second day of the Singapore Apex Business Summit, referred to firms future-proofing their businesses and diversifying to ride out disruptions to supply chains and prepare for climate change.

The summit, now in its second edition, aims to address mounting business challenges such as disruptions to trade and supply chains.

SM Teo, who is also Coordinating Minister for National Security, said at the event, held at Sands Expo and Convention Centre: “Acute disruptions to supply chains have turned many of our long-held economic assumptions on their heads.

“Although the pandemic is over, other disruptions persist, not least in the form of two brutal wars in Europe and the Middle East.”

He added that climate change will also disrupt economic activity as it amplifies the frequency and severity of natural disasters.

Countries have also turned away from free trade, putting up barriers and “decoupling” for national security reasons or to protect their own industries, SM Teo said.

These trends all mean that business-as-usual has ended. Instead, firms and governments now operate more on a “just in case” basis, rather than “just in time”, he noted.

“Just-in-case” means diversification of the entire business, including markets, products, the locations of facilities, and even the people that businesses hire, he said.