Beyond China: Motorola Sets Up Ops Hub in Singapore

I came across this article yesterday which cites Motorola's plan to "set up its first global supply chain management facility in Singapore ... the overall improvement in its supply chain efficiency is likely to be the key driver of profit growth, according to Reuters". Motorola intends to invest $60 million in a new "Global Supply Chain Control Tower (SCCT)". The article suggests a number of reasons why Motorola choose Singapore to locate this new operation including the country's stability, communications and business infrastructure, and access to a large regional talent pool. And I might add that they'll have no worries about gum chewers on the plant floor (just a joke, OK). Already today, Singapore is the center of Motorola's "competence for several of its key supply-chain and manufacturing functions, such as global purchasing, sourcing, procurement as well as logistics." I look at Motorola's decision to invest in Singapore -- which has materially higher wage levels than other countries in the region -- as a hedge against overdependence on specific Asian markets like India and China. As a stable bridge between the East and West, Singapore will provide Motorola with significant options to make the best long-term Spend Management decisions throughout Asia. Perhaps more costly in the short-term, Singapore feels like a stronger long-term bet to me as a regional operations hub than other choices.

Jason Busch

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