Khoo Boo Hor keeps faith with innovative, value-added manufacturing that doesn&rsquo t compete on cost

 

LOCAL precision plastic parts maker Sunningdale Tech, which was privatised last April, is forging ahead with expansion, as chief executive officer (CEO) Khoo Boo Hor tells The Business Times (BT) he is banking big on the manufacturing sector.

 

&ldquo I&rsquo ve always believed &ndash manufacturing, you can see it&rsquo s brick and mortar right? Ten, 20 years, 30 years from now, you&rsquo ll still need manufacturing,&rdquo he says, while noting that the sector makes up about a fifth of the Singapore economy.

 

Khoo, who has been CEO since 2009, notes that Sunningdale &ndash in his more than a decade at the helm &ndash &ldquo went through ups and downs&rdquo such as the global financial crisis in 2008 and the meltdown in the North American automotive sector.

 

&ldquo Every time, in each of these crises, we really focused on streamlining our organisation processes, upgrading our people, managing our costs, and always making sure that we were ready to ride the next wave &ndash no different from the recent Covid-19,&rdquo Khoo declaims.

 

Sunningdale spent the last few years &ldquo continuing to improve our system and processes so that, again, we want to emerge better and stronger post-Covid&rdquo , he adds, pointing to investments in robotics and automation that are integrated through the Internet of Things.

 

Amid a global push for manufacturing &ldquo onshoring&rdquo , Khoo told BT in early 2021 that the company has had to &ldquo pivot fast&rdquo from the industry strategy of manufacturing in low-cost markets, and towards more production sites closer to customers in developed economies.

 

He argued at the time that the privatisation bid by group chairman Koh Boon Hwee and private equity firm Novo Tellus would give the company the ability to do so.

 

Now, he reiterates the point on investing in high-cost countries: &ldquo Yes, there&rsquo ll be some customers for whom cost is still more sensitive, but we always like to do products that are less cost-sensitive with customers that emphasise a lot on quality, a lot on solution complexity, where not many companies like us can be the partner.

 

&ldquo That&rsquo s how you differentiate.&rdquo

 

Sunningdale&rsquo s global footprint spans 18 locations across 9 countries: Singapore, Malaysia, China, Latvia, Mexico, Indonesia, Thailand, India and the US, where the group most recently acquired Arizona-based plastics company Moldworx in late 2020.

 

&ldquo Despite the Covid pandemic, it never stopped us from expansion,&rdquo Khoo says, referring to the deal as &ldquo part of our strategy to grow our medtech industry&rdquo arm, which is a priority growth area for the group.

 

That&rsquo s as he affirms that Sunningdale continues to put some S$25 million a year into capital expenditure, albeit with a &ldquo very prudent&rdquo , &ldquo very careful&rdquo approach.

 

&ldquo The last few years especially, we invested a big portion of it into our medtech segment, our healthcare segment, because this is our fastest-growing segment, and we expect that it will continue to be so for the next 3 to 5 years,&rdquo he says.

 

Identifying the company&rsquo s key advantages as technological innovation, an international footprint, engineering capabilities and human capital, he also tells BT that &ldquo we&rsquo re prepared to make sure we gear up enough people, talent and resources&rdquo for successful growth.

 

Sunningdale now has about 800 employees, and plans to hire more than 100 new technicians, engineers and professionals in Singapore &ldquo in the next couple of years&rdquo , he adds.

 

That includes up to 25 engineers and professionals for the innovation technology centre that was set up in Sunningdale&rsquo s manufacturing building this year to develop complete and vertically integrated solutions for its customers&rsquo complex engineering projects.

 

The company also partners institutions, such as the Agency for Science, Technology and Research, in innovation, research and development schemes like the Technology for Enterprise Capability Upgrading initiative that seconds public researchers to the private sector.

 

Khoo joined Tech Group Asia in May 2005, just ahead of its merger with Sunningdale Precision Industries, and served as group operations director while being groomed for leadership in the CEO seat.

 

Before that, Khoo spent more than 16 years at tech multinational Hewlett-Packard (HP), with his last role there in enterprise storage and server manufacturing operations.

 

He calls his experience at HP &ldquo very relevant as we tried to build Sunningdale into a large enterprise and, eventually, bigger&rdquo , adding: &ldquo This was very important because my previous job gave me a global perspective, not just in Singapore.&rdquo

 

While he started out with a background in manufacturing, he tells BT that &ldquo I learnt a lot of other functions&rdquo &ndash especially management &ndash as he moved up over the years.

 

&ldquo And I really enjoy it. We have transformed a lot. You feel very motivated because you have seen the company grow over the years,&rdquo says Khoo, who was named Best CEO for small-caps at the Singapore Corporate Awards in 2017.

 

&ldquo I&rsquo m a very hands-on person by nature &ndash I like things because of my engineering background &ndash so I really enjoy what I&rsquo m doing. And I&rsquo m very motivated and there&rsquo s a lot much more to do with all this Industry 4.0, because the industry has continued to move on to the next level, and I think there&rsquo s still a lot of things to be done. Complacency is never in my thoughts.&rdquo