Sunday, April 09, 2006

PEIE on Manufacturing, IT & Innovation

With its business reputation built on oil and gas, Oman might seem an odd choice of location for companies whose innovation and ICT skills are shaping the future of the Gulf’s economy. Yet there is a vibrant and thriving ICT sector, benefiting from Oman’s business-friendly environment, one that is being shaped and nurtured by PEIE.

The Sultanate’s ICT sector has recently received a major boost that will see the country become a centre for high-tech, ICT and related R&D and manufacturing developments. The project in question is KOM, a 68 hectare Technology Park located 30 kilometres north west of Muscat. Neighbouring Sultan Qaboos University (SQU) and Rusayl Industrial Estate, KOM boasts 12,000 square metres of high-tech office and business incubator space plus two leading ICT colleges - the Middle East College of Information Technology and the Waljat Colleges of Applied Sciences. Moreover, a second phase of development consisting of 10,000m2 of Class A accommodation will come online in August 2006.

KOM: Oman’s Technology Home
KOM offers state-of-the-art high-tech office facilities for firms operating in the Gulf region as well as grow-on space for new start-ups and spin-out projects from SQU. Apart from office space, KOM provides its 35 tenants with high-speed broadband Internet connection as well as shared facilities, including conference and meeting rooms. KOM is also home to The Knowledge Mine (TKM), a business incubator program – “an initiative supported by business mentors from Trowers & Hamlins, Ernst & Young, KPMG and Intilaaqah. The facility will eventually house up to 25 start-up entrepreneurs,” commented Sultan Al Habsi, Executive President, PEIE (pictured above). “KOM provides not only the launch pad for new and developing technologies emerging from the country’s academic sector, but also a key point of access for established multinationals as well as SMEs to tap into the Gulf’s fast-growing business, ICT and research network. What TKM isn’t is another serviced accommodation provider. The clue to what we do is in our name. We help businesses grow.” remarked Eng. Mohammed Al Ghassani, Executive Vice President, PEIE.

PEIE’s Reach
Rich in cultural heritage, Oman has undergone a radical transformation over the last three decades to emerge as a major manufacturing and technology centre in the Gulf. This is being driven by a growing knowledge sector, nurtured by the establishment of KOM, the research strengths of SQU, and the Park’s membership to organizations such as the International Association of Science Parks, the World Wireless Forum and the UK’s Cambridge Network. Managing and marketing KOM is the responsibility of PEIE. In addition to KOM’s 68 hectare campus, PEIE manages in excess of 5,800 hectares of prime industrial land and oversees the day-to-day operations of six industrial estates in Rusayl (Muscat), Raysut (Salalah), Sohar, Sur, Al Buraimi and Nizwa as well as the Al Mazunah Free Zone situated on the Oman – Yemen border. Attractively priced land and premises on PEIE estates are ready and waiting. “An encouraging factor for manufacturers and ICT companies is that we give more than the usual support and help. For example, we provide site and premises details tailor-made to companies’ requirements; we organize familiarization tours of our estates; we offer information and guidance on issues ranging from planning and incentives to recruitment and supply-chain contacts. Through our One-Stop-Shop set-up we even help tenants in finding homes and schools and settling into the country. These are important factors for firms and executives considering moving into the Sultanate. We’re proactive in attracting new tenants, and once they’re here we want them to succeed and to feel comfortable,” remarked Al Habsi. Indeed, this is an organization that is helping power the Omani economy with remarkable energy, innovation and enterprise. Al Habsi added: “It’s important that we publicise the manufacturing sector, and its successes. Some of the most exciting activities in this country are now happening in the manufacturing sector.”

Oman’s Manufacturers
As much as KOM is a new chapter in PEIE’s history, the manufacturing industry remains the organization’s main responsibility. “Manufacturing” as Eng. Hamad Al Harthy, Director General, Rusayl Industrial Estate pointed out “plays a pivotal role in driving Oman’s economy forward. In fact, Oman’s manufacturers have an enormous impact on the Sultanate’s economy.” Just consider manufacturing in global terms, it is estimated that for every US$1 of manufactured goods demanded, another US$1.50 in other goods and services is generated. And every US$1 million of manufacturing output supports 6 jobs in other economic sectors. By comparison, every US$1 million in service-sector output supports 3.5 jobs elsewhere. From these figures, it is clear that maintaining and developing a strong manufacturing sector is one of the keys to Oman’s future prosperity. Indeed, recently released figures indicate that world trade growth averaged 10.2 per cent in 2004, reflecting rapid increases in industrial production and investment activity. The expansion in trade volumes in 2004 is reminiscent of the increase observed in 2000 and mirrors the rapid recovery in industrial production that began to take shape in the second half of 2003 and continued into 2004. However, manufacturing will remain highly competitive as customers continue to expect more and more. “The use of technology in manufacturing will also increase as customers, partners, suppliers and vendors will all want the transfer of information to be done electronically, from simple e-mails right through to complex 3-D models of components and assemblies. If manufacturers don't have the capability to communicate electronically, then their demise is almost inevitable,” commented Al Ghassani.

Said Al Mashani, Director General of Raysut Industrial Estate, is optimistic, yet not complacent, commenting that "in today’s competitive and highly regulated global market, PEIE tenants have to be able to react to a number of variables, any one of which could affect their business. With worldwide markets, PEIE-based management teams are focusing on quality, price and delivery; our tenants recognize that they won’t succeed if they don’t satisfy customers in all three criteria simultaneously.”

Key Partners
In partnership with the Ministry of Commerce and Industry, PEIE works hard to ensure that the best possible environment is provided in which manufacturers and ICT firms can do business. Indeed, since its formation in 1993, PEIE along with other Government organizations has been delivering what matters most to business - a platform of economic stability and a fiscal and regulatory environment that encourages rather than hinders competition, innovation, entrepreneurship and growth. "the future of Oman’s manufacturing sector will undoubtedly hinge upon how a range of different factors interact to create a climate in which businesses can succeed. On one level, there are factors, external to businesses, over which individual PEIE-based management teams can have little or no influence. On another level, it’s the vision and talent of those management teams, linked to a highly motivated workforce, that will determine their future success,” says Al Habsi. In fact, through PEIE’s Training Centre and monthly Open House seminar program (held on KOM, Sohar Industrial Estate and Raysut Industrial Estate) PEIE stresses the concepts of productivity and growth. In brief, it:

o Encourages firms to innovate, reduce costs and provide better quality goods and services to the consumer.

o Promotes enterprise and innovation to unlock the potential of new technologies and working practices, supporting entrepreneurship, risk-taking and management.

o Helps improve the skills base to maximise the contribution of human capital to growth.

“We actively encourage our tenants to take the initiative in areas where they can have a direct impact,” says Al Habsi.

For the Omani economy as a whole, innovation is the key to higher productivity and greater prosperity for all. The Government has already laid the foundations of an innovation-driven economy by creating a stable macroeconomic environment, promoting fair and free trade improving education and skills and establishing KOM. But there’s more to be done. “To hold our own in modern manufacturing and ICT – areas that PEIE is actively involved in – we’ll need to innovate strongly by creating new high-tech firms and light-manufacturing industries as well as helping current PEIE-based firms upgrade,” remarked Al Mashani.

Continuing on the theme of innovation Al Ghassani added: “We need to raise the level of innovation in our service industries. In this regard, PEIE is in the vanguard of helping Oman become a country with a reputation for turning knowledge into new and exciting products and services; a country that invests in business R&D and education and skills, and exports value-added goods and services. As you’re aware, KOM is very much part of this process. Indeed, this is why PEIE is organizing Smart Manufacturing Conference, 23 – 24 January 2006. We feel there’s a real need to bring business people, policy makers and academics together to discuss issues that are impacting on today’s manufacturing sector.

Solid Management
Al Mashani pointed to the Government’s strong support for manufacturing and ICT as delivered through the PEIE network. He emphasised that “we should be in no doubt that the success of Oman’s manufacturers and ICT firms is crucial to achieving prosperity for all. Make no mistake, there are some exceptionally good management teams on PEIE estates, doing successful business in areas of manufacturing and ICT.”

Oman certainly has a strong manufacturing future. But manufacturing the world over is changing. Omani manufacturers - whether they are in automotive spare parts, canning, printing, cables, or car batteries - are being transformed through new technologies and techniques. Computers, information technology, the Internet - all have been harnessed in the pursuit of greater productivity, greater efficiency, better design; making many PEIE-based manufacturers among the most efficient in the region.

So, is there a future for manufacturing in Oman? The answer from Al Habsi is an unequivocal “yes, as long as there is the foresight and talent at all levels in our business operations to capitalise on the market opportunities that will undoubtedly continue to exist.”