AMID the Covid-19 pandemic, information, communications and technology (ICT) service provider NCS is one of the few lucky firms whose operations have been left largely unscathed. In fact, with the acceleration of digitalisation in the current climate working in its favour, the company is eyeing further expansion in the Greater China and Australia regions, and seizing more opportunities within the private sector.
Established in 1981, NCS, a wholly-owned subsidiary of Singtel, has an established track record working on public sector projects within Singapore. One of its more recognisable projects would be the MyTransport.SG mobile application introduced by the Land Transport Authority in 2010. The Singapore Tourism Board also previously commissioned NCS to develop a data analytics platform for tourism businesses to track information such as visitor arrivals and trends.
While Singtel may have posted a rather weak set of results in its latest quarter ended June 30 and for its fiscal year 2020 ended March 31, NCS is holding up.
For FY20, NCS's operating revenue increased 7 per cent to S$2.14 billion. This was S$30 million more than the operating revenue for Singtel's Singapore consumer business. NCS accounted for 43.7 per cent of the operating revenue of Singtel's local enterprise business.
Additionally, NCS's earnings before interest, taxes, depreciation and amortisation rose 24.7 per cent year on year - from S$235 million in FY19 to S$293 million in FY20.
As Singtel's share price sinks - recently touching a 12-year low - could NCS be the unit to rejuvenate investor interest in the stock?
As at March 31, NCS's order book stood at S$3.2 billion. The company's order book has grown steadily in the last five years with the exception of FY18, when there was a slight dip to S$2.8 billion from S$2.9 billion in FY17.
NCS in August welcomed a new chief executive officer: Ng Kuo Pin, a former partner at Accenture who joined NCS as its deputy CEO in February 2019.
Mr Ng is making his mark on the company with changes that he said will help NCS better serve its clients.
Employees at NCS are now encouraged to "specialise even more" across different skill sets, and have been organised into "practices" such as applications, infrastructure, engineering and cybersecurity.
This reorganisation means that each project team can consist of individuals specialising in different skill sets, rather than having the same people work with the same client for years across different projects.
"(This) allows for more opportunities for people to try different things and cross pollination of ideas, as opposed to a structure in the past that also works, but (may be) a bit more hierarchical and rigid," said Mr Ng.
To ensure continuity and better understand client needs, NCS has assigned "client account tribes" for its "key clients". The "tribe" discusses ideas with the clients before coming up with a "solution" to address their needs. This is as opposed to just receiving tenders from clients and "responding to them".
"The intent is really to make us a lot more agile, a lot more responsive to the needs of clients, and to co-create with the client," said Mr Ng.
NCS has also set up a new organisation called NCS Next, which consists of a team of experts focusing on technology advancements and trends such as cloud and artificial intelligence. They engage in digital projects, build platform services and carry out research and development.
Mr Ng said these changes are inspired by his 24 years at Accenture. "My background as a consultant in my prior career ... helps me to believe that at the end of the day, the most important aspect you need to get right is the people … The need to respect the individual's needs must be your top priority."
Having spent a lot of time on public sector projects for the past 39 years, Mr Ng said the time is ripe for NCS to "branch out (into the commercial world) in order to continue to grow as an organisation".
"The commercial world is always the sector that drives a lot of innovation," he added.
As such, NCS has created three business units focusing on the commercial sector alone: healthcare and transport; communications, media and technology; and financial services, industrial and commercial.
To strengthen its expertise within the various sectors, NCS has "taken a very active approach to bring in people from the (relevant) market and industries to lead (its) foray".
Expanding into the commercial space will allow employees to apply any acquired knowledge in the public sector as well, enhancing NCS' ability to "better work with clients".
So far, the company has seen "good growth" in financial services, healthcare and transport.
Earlier this year, NCS announced that it has partnered with the Network for Electronic Transfers (Nets) to develop a new electronic payment and securities-settlement platform for central banks in the Asia-Pacific.
While Mr Ng could not reveal any further details about ongoing projects due to confidentiality purposes, he said that the company intends to "continue to invest in these areas".
Travel restrictions and uncertainties arising from the Covid-19 pandemic have not deferred NCS' plans for regional expansion in Greater China and Australia.
Mr Ng said the company already has "a good foundation" in China, having been there for 20 years. In Australia, a local leadership team was formed in August last year.
At present, NCS is still "actively recruiting talent" in those markets. "Australia is a mature market (and has) a big addressable market attractive for companies like us. It's also attractive because ... (it) is actually one of the first countries where Western technologies from North America will move to … There's a lot of leverage we can gain from that."
Mr Ng said there has been keen interest in digitalisation efforts within the healthcare, transport, telecommunications and public service sectors -- which NCS can use to its advantage given its experience with these industries in Singapore.
"(For Greater China), as long as there're good economic activities, there're good prospects for IT systems, for changes in processes, for digitalisation … and if you look around, the Chinese companies are still growing very well in the market. Many of them are actually now expanding outside China."
NCS is aiming to work together with Chinese companies to help in their expansion.
"When you build systems, when you build processes, it's more than just technology. You need to (know how to) operate in a different way in different locations," said Mr Ng.
The Covid-19 pandemic has presented its fair share of "challenging times" for NCS, said Mr Ng, but it has largely opened up more areas of growth for the company due to the "accelerated digitalisation demands".
He sees "good momentum" for NCS moving into the second quarter of FY21. "Covid-19 is clearly a crisis and something we worry about, but in the case of NCS, it has really helped to nudge us to accelerate things."