Growth In The Modern Services Industry

Consisting of organisations providing professional, financial and technology services such as cybersecurity and banking services, the modern services cluster is expected to play a bigger role this year. Contributing to 30% of the economy, this cluster will benefit greatly from digitalisation and innovation. According to the Industry Transformation Map, by 2020, Singapore aims to reach a 4.6% growth rate per annum for Professional Services to reach SGD31 billion in value-add as well as create 5,500 new Professional, Managerial, Executive & Technical (PMETs) jobs per annum.

Merging and changing of bank jobs

Digital ambassadors are set to take over banking roles such as bank tellers, customer service officers, and relationship managers. Advanced analytics can even aid such digital ambassadors to not only do basic transactions but to also forecast consumer needs and deliver advisory services. the Institute of Banking and Finance and the Monetary Authority of Singapore (MAS) mentioned in a report that a third of job roles in Singapore’s finance industry will likely be merged or changed due to automation and data analytics. In particular, bancassurance officers in retail and corporate banking, as well as investment performance analysts in asset management, are at risk of being merged or displaced due to automation.

New roles in areas such as Information Technology (IT), compliance, data and analytics and marketing are likely to be created, hence signalling the need for employees to re-skill. Over the next two years, some 19 financial institutions including local banks have committed to re-skilling close to 4,000 employees and re-deploy them in a new or expanded job. Maybank Singapore, for instance, has launched an IBF-certified course which is part of their SGD10 million digital employee upskilling programme.

Endless innovation

Professional services need to deliver solutions in a swift and cost-efficient manner in order to survive and thrive. Precursor Group, a local accounting firm, scaled up to reach over 500 clients with just 60 staff by diversifying from traditional audit services to include HR and analytics services using its proprietary cloud-based delivery platform. A full-service Singapore law practice, WongPartnership also improved its due diligence processes for Merger and Acquisition (M&A) transactions by employing predictive technologies in various Artificial Intelligence (AI) tools.

The advertising, consulting and engineering services industry are incorporating digital capabilities such as data science and analytical insights into their operations. With digital transformation being a buzzword in the region, there are now more and more opportunities for strategy and operations consulting to work on such projects with their clients.

By continuously innovating professional services, strong competencies can be built over time. This enables the firm to differentiate itself from competitors.

Facilitation by the government

In a world where collaboration can triumph over competition, the government is bound to step in to bridge the gaps amongst start-ups, SMEs, research institutions, and global conglomerates. Living labs, for instance, are in place to enable companies to come together to realise an idea. The facility allows firms to test-bed and commercialises solutions.

Maritime and Port Authority of Singapore (MPA), for example, launched a Maritime Innovation Lab in April 2019 to boost the country’s maritime technological capabilities. As part of the broader MPA Living Lab effort, this space has both physical and digital aspects that act as a co-creation platform for innovation. In addition, HDB’s $10 million contract with NCS consortium also aimed to develop a digital master plan and Smart Hub to boost the liveability, efficiency, safety and sustainability of HDB towns and estates. The Tech Start for Law programme is also in place to help Singapore law firms defray initial costs associated with the adoption of productivity tools to leverage on technology. This is especially important as a consultancy study commissioned by the Law Society in 2016 showed that only 9% of small and medium-sized Singapore law practices used technology-enabled productivity tools. One main reason cited for the low adoption rate was cost.

All these also suggest opportunities for consultants in various fields to propose smart initiatives.

Boom in demand for specialised services

With a steady growth of engineering and infrastructure projects, financial services are likely to see an increase in demand for specialised services including risk management, business valuation, project management, and more. Further growth of established payment players can also boost the financial services and information communication technology sector.

The finance and insurance sector, on the other hand, will tend to be more cyclical in nature. Trade conflicts around the world can dampen investors’ confidence, which can affect the securities and the forex market. When there is a need to increase working capital, P2P lending can be a method of securing business loans. Be it SME funding, bridge loans, or microloans, this form of business financing can help the firm tide through challenges and turn ideas into an actual business.

Talent aid

Beyond the trends listed above, SMEs also face headaches in areas relating to human resources. Firms face talent crunches, particularly in high growth areas where more highly skilled employees are needed. A study commissioned by Spring Singapore and UOB-SMU Asian Enterprise Institute found that job candidates do not want to join SMEs, and SME employees do not want to stay in their roles for an extended period because they do not expect prioritised employee training and development or clear advancement opportunities.

Thankfully, Professional Conversion Programmes are in place to train PMETs to take on cloud computing, programmatic advertising, internal audit, user experience and user interface. SkillsFuture Earn and Learn Programmes also tackles areas such as digital content creation, building information modelling management, marine design, and more. Such measures allow employees to seek higher education and learning to better contribute back to the firm.

Surge in digital payments

The value of cashless transactions in Singapore grew by 7.2 per cent a year from 2012 to 2016. Having an open, accessible, and interoperable national e-payments infrastructure is crucial in enhancing convenience for citizens and businesses to realise a Smart Nation. Digital transactions are comparatively swifter and seamless. While many Singaporeans have taken real-time FAST (Fast and Secure Transfers) transactions for granted, that was a service that was only launched in 2014 in Singapore’s banking industry. PayNow was launched in 2017 to allow P2P transfers between customers of participating banks using mobile numbers or personal identification numbers. Even CPF and MOE have piloted the use of PayNow in March 2018 to disburse CPF lump sum and Edusave award monies. From 2019, NSMen will also be able to receive their IPPT awards via PayNow on the same day as opposed to two weeks after completing their IPPT. PayNow Corporate was also introduced in 2018 to allow businesses and government agencies to pay and receive funds immediately through a Unique Entity Number. The Singapore Quick Response Code (SGQR) was launched by the Singapore government to allow merchants to accept mobile payments.

The surge in digital payments translates into many opportunities in the professional services sector. Getting SMEs to join e-payments could be the final step before Singapore becomes completely cashless. Consultants can work with clients to address cost concerns and delayed payment settlements, as well as educate them on the changing payment ecosystem and how digital payments can add value to their businesses.


As a whole, the modern services industry has been morphing quickly. Firms, particularly SMEs, need to be alert to stay relevant.

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