SIS Sugar is a homegrown brand that many of us can recognise at local supermarkets. It is the largest supplier of sugar to the retail, food & beverage and pharmaceutical industries in Singapore.
Unknown to many Singaporeans, SIS has also been the no. 1 brand in the Middle East for the past 30 years.
But do you know the history behind this company and how it has reinvented itself over the last 50 years?
Who established SIS Sugar?
SIS, or Sugar Industry of Singapore Limited, was established in 1967 by the Singapore government just 2 years after gaining independence. Sugar was a government controlled commodity and this move was a strategic initiative to ensure that Singapore had enough sugar for the nation’s nutritional needs.
The sugar refinery employed about 350 people, imported raw sugar from countries like Brazil and refined it into white sugar and other grades according to customer requirements.
In 1988, the Singapore government decided to deregulate the local sugar industry.
ED&F Man Holdings Limited, together with Kuok (S) Pte Ltd, formed a joint venture and bought SIS from Temasek Holdings, the investment arm of the Singapore government, and named it SIS ’88 Pte Ltd.
A bittersweet transformation
Back in 2002, against the backdrop of depressed sugar prices and high oil prices, the shareholders of SIS ’88 Pte Ltd decided to shut down the sugar refinery and restructure the business to a marketing and distribution model.
The shareholders of SIS invested a considerable amount of money to build a 24,000 mts silo and conveyor belts, which would receive sugar from a dedicated vessel from Australia called the BIBO, via the port facilities in Jurong port.
This sugar receival system, where sugar is harvested, transported, received and packed with minimal human contact, was the first of its kind in Asia!
However, this successful business transformation came with lots of challenges.
Although the company redeployed many of its workers, who had to learn new skills and adapt to new business processes and technology, it inevitably had to let many other workers go as there were far fewer roles.
Rebuilding jobs and skills with the union
At that time, Mohamed Yusoff Bin Adenan had been working at SIS for 2 years as a technician when the restructuring was announced.
“Unfortunately, there were simply not enough roles for everyone. My task was to find a way to lead the remaining workers through the restructuring process, with a view to converting the factory from a refinery to a processing plant.”
Just 2 years into his new job, Yusoff faced the daunting task of working with the management of SIS to explain the rationale of the company’s new strategy and to help maintain staff morale.
“The workers’ future was at stake and I could do nothing about it. Although I was not retrenched myself, I realised it could be me the next time. I then resolved that simply being a union member was not enough. I had to become more active in union work so that I could be in a position to help others,”
he told NTUC This Week is an earlier interview in 2015.
SIS was already then unionised by the Food, Drinks and Allied Workers’ Union (FDAWU).
Yusoff, and other unionists in the FDAWU branch union of SIS, heavily engaged staff to communicate the company’s new goals, as well as dialogues with management to discuss how to upgrade employees’ skills, purchase new equipment and improve working conditions to meet the new challenges.
How union representation helped both retrenched and retained workers
The whole situation was very sensitive as there was also a dispute over the payout of redundancy benefits, which the union and SIS management eventually resolved via arbitration at the Industrial Arbitration Court.
“The matter of retrenchment payouts caused the relationship between union and management to sour at that time,”
said Yusoff when recounting the incident.
It was through subsequent years of building trust between workers and management that the relationship became much more open and transparent today.
With the union working closely with management and workers to oversee the transition and building strong mutual understanding and support, SIS successfully saw through the restructuring plans.
Creating a smarter and safer factory
The commitment of both FDAWU and SIS management to progress together led to the company investing in new machines to fully automate the sugar sorting and packaging processes.
This was achieved by adopting the Productivity Innovation Credit Scheme (PIC), which improved the working conditions of SIS staff, many of whom are over 50 years old.
Previously, staff would have to carry 50 kg bags of sugar, pack and stack cartons of sugar packets and shrink wrap the pallets for local delivery or export.
Such backbreaking work has now been automated such that a production line needing 20 workers then only needs 2 workers now, and the lead time to fulfil 1 order has shrunk from 3 weeks to 3 days.
Workers have been retrained to work in other parts of the company, and have fewer risks of accidents due to machines taking on a major part of the tough work.
SIS continues to innovate and use technology to lower its production costs and respond quickly to customer needs, to remain competitive by delivering consistent quality products as it seeks expansion in overseas markets with a team of highly skilled and committed workers.
The next time you see a packet of SIS Sugar in the supermarket, remember this 50-year-old story of how this former government-owned enterprise evolved from a refinery to become the No. 1 sugar brand in Singapore and the Middle East.