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Humpty Dumpty: The Case of a Broken Egg Made Whole

NUS Business School National University of Singapore HYFLUX: CLEAR WATER, CLEAR DESIGN Lau
Geok Theng, Denise Liu Lijuan and Jonathan Gerard Ho This case study was commissioned by the DesignSingapore Council as
part of a larger campaign under the DesignSingapore Initiative to raise business competitiveness through design. The DesignSingapore case studies aim to demonstrate the importance of design as an integral part of a business's strategy and competitiveness, in particular, how these businesses manage their design resources; how design relates to other functions like engineering, marketing, manufacturing, and corporate communications; and how design decisions affect many facets of these organisations. Formed by the Ministry of Information, Communications and the Arts in August 2003, the Design Singapore Council is the leading, one-stop public organisation for design promotion and design development in Singapore, as well as representative body for Singapore design at international platforms. Associate Professor Lau Geok Theng, Denise Liu Lijuan and Jonathan Gerard Ho prepared this case. It is based on both public and internal company documents and interviews with key personnel from Hydrochem (S) Pte Ltd. As the case is not intended to illustrate either effective or ineffective practices or policies, the information presented reflects the authors' interpretation of events and serves merely to provide opportunities for classroom discussions. COPYRIGHT 2004 National University of Singapore and DesignSingapore Council. All rights reserved. Not to be reproduced, stored, transmitted or altered in any way without the written consent of the copyright owner. For copies, please write to the DesignSingapore Council, Ministry of Information, Communications and the Arts, 140 Hill Street, 5th Storey, MITA Building, Singapore 179369. Email: info@design singapore.org .

Hyflux: Clear Water, Clear Design "In a tough economic climate, Hyflux has surmounted many
challenges and its growth strategy has set it on course to make the quantum leap into the big league by taking on larger value projects, in both the industrial and municipal markets - Olivia Lum, Group CEO and President Introduction Hyflux was accorded the Enterprise Award for 2003 at The Singapore Business Awards. In 2002, it was named one of the Best 200 small companies by Forbes magazine and was presented the "Most Admired Sesdaq Company" by Smart Investor Magazine. Founded in 1989, Hyflux has grown from a systems integrator into a leading regional player in water and fluid treatment solutions. In January 2001, Hyflux was the first water treatment company to be listed on the Singapore Stock Exchange. As of May 2004, Hyflux has a market capitalisation of well over S$480 million. The company has offices in Singapore, China and Malaysia with over 500 employees servicing multinational clients and municipalities in the Asia-Pacific region. Its success in the industry is largely due to its design capabilities in developing leading edge membrane technology for creative water and fluid treatment applications. Such capabilities are spurred on by the passion, professionalism and performance of its people who seek to reach higher levels of excellence and continuously raise the bar for the enterprise and the industry. This dedication is guided by: Their vision: To be a world-leading water treatment company. Their mission: To create superior value for the stakeholders through advanced membrane technology. Their values: To embody the entrepreneurial spirit, daring to dream with the aim to excel. To be committed in enhancing the environment and in delivering innovative solutions, executed with the utmost professionalism and integrity. To value their partnerships with collaborators and customers as well as every employee and his or her contribution. 1 Design Capabilities: Hyflux in Cutting-Edge Membrane Technology "With cutting-edge membrane technology, Hyflux's clients can eliminate cumbersome traditional physical and chemical processes and attain large savings in operating costs." - Dr Deirdre Murugasu, Executive Vice President Hyflux offers quality and convenience to its customers, priding itself on the ability to provide one-stop solutions for raw water treatment, wastewater treatment and water recycling and process stream purification. These water treatment solutions are supported by its cutting-edge membrane-based separation technology. Hyflux provides solutions for the entire value chain from process design and optimisation to turnkey engineering, procurement and construction (EPC), pilot testing, commissioning, maintenance, and servicing. Their business processes are designed in such a way that each project becomes a partnership with their

customers. Jointly innovative solutions are uncovered and purpose-built plants and systems are designed to meet the client's objectives, reduce their costs and provide superior returns. Hyflux's Membrane Technology Hyflux business revolves around its proprietary membrane technology. Its core business is in the development and commercialisation of membrane technology. Hyflux do not just produce standardised membranes. They can improvise their membrane structure and customised them to suit the customer's requirement. To date, Hyflux has engineered a wide range of leading edge membrane systems including the modular ultrafitration membanes, , submersible ultrafiltration membrane systems, stainless steel membrane systems and variable speed rotating membrane systemsThese membranes come in hollowfibre, tubular or spiral-wound configurations. Ultrafiltration is a lower pressure membrane process used to separate bacteria, viruses, and particulate matters from a feed stream. The Kristal300 is a specially manufactured hollow fibre membrane module with special configuration to achieve optimal results tailored to difficult waters. It is able to remove colloidal material, suspended solids, bacteria, viruses, cysts and other pathogenic materials. The modules come in one or two-metre long sections and their key advantages are higher strength, higher efficiency and more robust operation, lower footprint of the bioreactor, ability to handle higher suspended solid content and ability to provide cleaned surface through air scouring backwash. It has a double-skinned design with separation layers on both sides of the fibre to enable the Kristal300 to be operated in either configuration (outside in or inside out) yielding flexibility in its applications. This cross flow filtration minimises solids build-up on membrane surfaces, 2 resulting in improved performance, higher permeation rates and an extended membrane lifespan. The submersible ultrafiltration membrane systems are able to replace the secondary clarifier in conventional waste treatment systems and reduce sludge production and footprint of the bioreactor by three to five times or more. The systems are able to provide consistent and better treated water quality and reduce recycling plant treatment costs. The stainless steel membrane systems are acclaimed as the world's toughest filter and provide superior separation performance under challenging process conditions. The tubular cross-flow technology and 316L stainless steel construction make these systems virtually "bullet proof" and allow processing of a wide variety of difficult, dirty or hostile streams over a broad range of chemical conditions, pressures and temperatures. The systems combine a rugged tube made of sintered stainless steel with a patented coating technology in which a sintered titanium dioxide layer is permanently bonded to the porous stainless steel tube. Hyflux provides the know-how to tap the full potential of these stainless steel membranes. Hyflux has developed SPIN2000, revolutionary variable speed rotating UF membrane filtration system to be employed in such extreme chemical environments. The SPIN2000 system uses rotating membrane disks operating at variable speeds to process solutions with high solids loading. These would be difficult to treat with conventional membrane systems. SPIN2000 able to effectively separate solids from liquids to produce high solids concentration and a clear filtrate in a single vessel, without being plagued with severe membrane fouling, concentration limitations, low fluxes and device plugging. Spin2000 systems can be tailored for clarification of fermentation broth & concentration of bacterial suspension in the pharmaceutical industry, clarification of fruit juices and beer fermentation in food & beverage industry, clarification of black liquor and separation of lignin in pulp and paper industry, treatment of waste water in textile industry and so on. To further facilitate advancements in the applications of membrane technology, Hyflux also collaborates with research bodies and tertiary institutions. It signed a Memorandum of Understanding with the Nanyang Technological University's Environmental Engineering Research Centre for collaboration in water treatment research using membrane technology. This allows Hyflux to tap on the centre's staff and equipment - some of which can cost hundreds of thousands of dollars to purchase. This way, results of the research projects could also lead to savings. 3 Design Capabilities: Hyflux in Creative Filtration and Treatment Applications "We deeply value our relationships with customers. Singular focus on customers' needs and requirements is the main reason for our innovation. Our sense of self-respect as a company is based on our intimate understanding of technology and customising it for our clients" - Foo Hee Kiang Executive Vice President Hyflux bases its systems delivery on very extremely stringent project management principles with precise technology specifications in a result- oriented process. Specializing in the design and building of customized turnkey packaged membrane filtration system that best utilizes the advanced technologies of microfiltration, ultrafiltration, nanofiltration, reverse osmosis and electrode ionisation, Hyflux provides solutions for a wide variety of applications which includes the design, engineering, installation, support and testing of large filtration systems for the food and beverage, dairy, fermentation and biotechnology and chemical industries. In addition to the processing of industrial fluid treatment, The company also provides innovative, cost effective and reliable turnkey solutions for water purification, waste water treatment, water recycling, desalination. Hyflux is able to treat raw water from a variety of sources, including surface water, subsurface water, seawater, well water, and polluted water, to produce De-ionised Water and Ultra-Pure Water for use in various industries such as wafer-fabrication, micro-electronics, pharmaceuticals, petrochemicals, biotechnology and the life sciences. The company is the licensed technology providers for the premier GE range of Electro-Deionisation Systems. Hyflux goes beyond "plain vanilla' wastewater treatment to the advanced realm of total water management. The company has developed the capabilities to help clients minimize waste effluent, audit flow processes and treat the effluent. Besides membrane filtration, the

company is able to design tailored solutions to specific problems by harnessing other processes such as advanced chemical oxidation, dissolved air floatation, pH adjustment, biological treatment, oil and grease removal, disinfection and sludge dewatering. Turnkey is a word commonly used to describe Hyflux's membrane-based filtration system. It reflects the total project management that clients can enjoy from Hyflux, for optimal water solutions and quality. At the start of a project, the project team will evaluate all aspects of the process together with its clients including industrial application, technology options, choice of membrane etc to accurately define their expectations and technical requirements. 4 Following pilot plant trials, Hyflux's technical personnel will embark on the actual manufacturing process to custom design and build the membrane filtration systems to the latest technology and performance, working very closely with the client through from the design, procurement, fabrication to delivery, installation and commissioning of the systems together with training in its operation and maintenance. The completion and commissioning of the turnkey system does not mark the end of the project for Hyflux, but rather as the start of a new phase in the cooperation. They have a team of dedicated sales staff and welltrained technical personnel to assure our clients product and process performance by providing a strong level of support throughout the life of the system Applications in Biotechnology Hyflux has developed systems which can be employed in extreme chemical environments well suited for the biochemical and pharmaceutical manufacturing process. This demonstrates that their know how and technology has no boundaries. Hyflux is not confined to water even though it is a water treatment company.The company is able to attain specific fractionation of high value products in the biotechnology processes such as cell harvesting, fermentation broth clarification, solvent extraction and many others. Each client and application is unique. Hyflux tailors technical solutions and service contracts to address different clients' needs. Some applications include fermentation broth clarification and concentration of bacterial suspensions in the pharmaceutical industry; and enzyme concentration and purification in biochemical industry; Specific applications in the food and beverage industry include concentration and recovery of waste sugars; clarification and de-colouring of sucrose and starch derived sugars; clarification and concentration of fruit juice, tea and coffee; desaling and concentration of food colourings; concentration of vegetable extracts; fractionation and concentration of egg albumin; and recovery of animal, fish and vegetable proteins. Specific applications in the chemical industry include dyestuff desalting and concentration; optical brightener, desalting and concentration; surfactant desalting; and silica sol concentration. Hyflux specifically customizes applications in accordance to the needs of its clients. For example, Hyflux has developed a microbial bioprocess to produce high purity L-lactic acid at a much lower cost compared to conventional methods for Sinolac (Singapore) Pte Ltd. The state-of-the-art organic manufacturing facility using Hyflux proprietary membrane filtration system has an initial production capacity of 20,000 metric tonnes per year for the separation, purification and production of the organic acid. The L-lactic acid is first recovered from a fermentation broth which is produced by fermenting a renewable biomass such as corn starch or glucose with lactic acid producing micro-organisms. The post fermentation process uses Hyflux's innovative and environmentally friendly membrane technology to remove particulate matter and multivalent metal ions effectively; separate, concentrate and purify lactic acids; and obtain a high yield of the lactic acid with very low level of impurities. 5 Using Hyflux's advanced membrane technology for the recovery of lactic acid from fermentation broth, Sinolac can enjoy improved yield, reduce operating costs, higher quality products and a more eco-friendly operation Applications in Desalination The need for high quality water has increased significantly during the second half of this century and water can no longer be considered as a natural self- renewable low cost resource. In Singapore, water consumption will rise by about 400,000 cubic metres to reach 1.6 million cubic metres per day by the year 2015. Desalination may play an increasing role in providing an economically viable solution to the water needs. Desalination is a process that removes dissolved minerals including but not limited to salt from seawater, brackish water or treated wastewater to produce water that is low in total dissolved solids. The three commercially proved desalination processes are distillation, electro-dialysis and reverse osmosis. In recent years, there is increasing global focus on membrane-based desalination technology as an economically-viable source of clean water. Hyflux is steadily building its experience and track record in this field. The Singapore Public Utilities Board awarded the first Build-OwnOperate desalination plant in Singapore to Singspring Private Limited, a wholly owned subsidiary of Hyflux. The plant, which will supply 136,380 cubic metres of desalinated water per day when completed in 2005, will have the capacity to meet some 10% of the island's water needs. The desalination project is a key cornerstone in Singapore's future water self-sustainability and was also accorded the Euromoney Water Deal of the Year, Asia Pacific 2003 The plant will use the reverse osmosis process. The membrane process uses much less chemicals and consequently generates less chemical waste, reduces environmental loadings and has fewer problems with corrosion. The process feedwater generally does not require heating and has lower energy requirements. The process has higher recovery rates of about 45% of the seawater. The process takes up less surface area for the same amount of water production. It will have an open seawater intake structure with two separate inlet channels with mechanical rake coarse screens. To reduce marine growth, necessary inhibitors will be added and polymers will be dosed to aid in coagulation. At the upstream and downstream of the cartridge filters leading to the reverse osmosis plant,

chemicals for dechlorination will be introduced while pH adjustment will be carried out at the downstream of the cartridge filters. To remove other contaminants such as oil and grease and suspended solids, dissolved air flotation units serve as separate units of the first stage upstream gravity sand filters. Pressure sand filters will be provided as the second stage of the pre-treatment process. 6 The reverse osmosis process consists of two passes. The first pass will remove the dissolved solids and will incorporate a pelton wheel type energy recovery system and pressure exchange type energy recovery system. The second pass will seek to reduce the boron level in the treated water. To potabilise the treated water, chemical post treatment will be introduced downstream of the reverse osmosis process. Lime will be used for pH correction. Chlorine and ammonia will be used for final disinfection and fluoride will be added. The treated water will be sent to the treated water tanks before being pumped into the main transmission line. Waste water from the process will be chemically neutralised before being discharged into the sea by a submerged outfall. Applications in Water Recycling: The NEWater Project In December 2001, Hyflux was awarded the first NEWater project at Bedok involving reclamation of secondary sewage into high grade industrial water. This contract was awarded through an open tender, a testament of Hyflux's know-how, expertise, dedication and competitiveness. Following Hyflux's successful first venture, another NEWater project at Seletar was secured from the Public Utilities Board in December 2002. This time, Hyflux's own proprietary Kristal300TM ultrafiltration membrane technology has been selected for use in the plant. Both NEWater plants were designed, manufactured, installed and commissioned by Hyflux. They are now fully in operation. A continuous, vigilant monitoring and surveillance program is setup by Hyflux to ensure that the NEWater produced is reliable and the water is of extremely high quality. NEWater is extremely highgrade water produced after treated 'used' water (secondary treated effluent water from municipal water treatment plants) has undergone stringent purification using a three-step process. The three steps involve the use of advanced membrane technology through the sequential barriers of ultrafiltration, reverse osmosis and final disinfection of water using ultra-violet light. The NEWater project is evidence of Hyflux's superior design and innovative capabilities; and attest to the fact that Hyflux is able to achieve: On-Time Delivery: Despite the tight time line, Hyflux was able to competently and efficiently deliver the project ahead of schedule. Integrated Design & System Detailing: Hyflux's engineering and design team completed the entire detailed process design, using the latest membrane process technology in order to provide the client with complete system detailing. Full Automation: The NEWater plants are designed to be fully automated from start-up to shut-down procedures. A set of advanced process 7 instrumentation and controls provides control for the system. In addition, a fully automatic warning system is designed by Hyflux to alert the operator of abnormal conditions in advance, allowing for hassle-free troubleshooting and maintenance. Continuous Plant Operation: With the high volume of treated water required for use in Singapore, the NEWater plant is designed for continuous operation daily, providing nonstop supply of extremely pure water for demanding industrial applications. Membrane Integrity: Hyflux conducts routine membrane integrity test as a standard value-add service for clients. Engineering Backups: Hyflux provides standby units for all critical systems to ensure uninterrupted operations in case of unforeseen circumstances. Most importantly, Hyflux designs an automatic shutdown for the plant in the event of adverse environmental or unforeseen conditions. Real-Time Data Acquisition: Hyflux includes an advanced computerised data acquisition unit providing operational data in real-time, thus enabling operators to detect long-term trends and predict responses for any future changes. Application for consumer and lifestyle market: Aquovation Hyflux's clientele is not limited to industrial customers. It has also designed a series of products for use in homes and for families. In January 2002, Hyflux announced its move to partner a US based company, Air- 2 water and take up an equity stake in this company. This is yet another deomonstration of membrane applications offered by Hyflux. Air 2 Water was founded by exNAA scientist and its holds the patent for a technology that can convert ambient atmospheric water vapour into potable water. Named Aquovate: " The process of extracting the freshest water possible from the atmosphere by continual recirculation through Hyflux Ultra-Filtration membrane technology and UV exposure". Using this patented technology, Hyflux has designed and incorporated its advanced membrane and disinfection technologies into the manufacture of a stand-along drinking water generator and dispenser that can be easily install ed in homes and offices. The crucial component of the generator hinges on Hyflux's ultrafiltration membrane technology. 'Aquovation' uses proprietary membrane and ultraviolet (UV) technologies to effectivelyharmful bacteria.. The "Dragonfly" is one such appliance that is built on aquovate Convenient and portable, aquovated water can be enjoyed with just the push of a button. The machine simply tales its source form the atmosphere, generating clean natural water everyday. and portable,. Designed for 8 economy and ease of maintenance, the innovative spirit of Hyflux is apparent in its concept and product design. It w ill continue to develop new membrane- based home products to fuel its foray into the consumer and lifestyle markets. Support For Design Capabilities: State-of-the-Art Infrastructure and Facilities "Specialised systems require specialised facilities. At Hyflux, we understand our customers' needs, which is why we have invested heavily in providing our staff with precise and adequate infrastructure required to engineer solutions according to the strictest specifications." Good workmen need good tools. Hyflux is dedicated in research and development. The company has been investing in membrane research and

upgrading it specialised facilities to produce and support high-end water treatment design and development. . Some of these facilities are: Clean Room: High purity systems require components manufactured in clean-room environment. Hyflux's Class 100K Clean Room is equipped with sophisticated cleaning and monitoring mechanisms for the manufacturing of high purity systems under precise conditions. Analytical Facilities: These facilities help to determine precise water quality. Each Hyflux engineer and technician is also equipped with a specially designed analytical test kit for on-site analyses. Further analyses are conducted at its fully-equipped laboratories. Membrane Testing: All its membranes are tested in elaborate membrane testing facilities to ensure 100% quality in all its proprietary membranes. Membranes are tested and micro-environmental conditions are manipulated for such properties as pH, pressure and flow rates. The company ensures 100% Quality Control checks before any membrane application. The company has been issued with the ISO 9001:2000 certification for the Manufacturing of Membrane products for filtration. Pilot Plants: The pilot plants are designed to be highly portable for instant on-site tests. These plants are constructed within Hyflux facilities to undertake small-scale moot runs of filtration systems for industrial plants before actual installation. These dry runs are integral in R&D testing for membrane applications. Laboratories: Hyflux has laboratories in Singapore and China fitted with the latest equipment. These laboratories provide water analysis services and conducts problemsolving procedures through the use of sophisticated testing equipment such as COD analysers, spectrophotometers, oxygen meters and turbidity monitors. 9 Computer Assisted Design: Hyflux uses dedicated engineering software and a CAD automation for the design of plants and systems to ensure a high level of precision detailing in its design plans and piping circuits, Fabrication and Assembly: At Hyflux, design and fabrication of system parts and components begin from scratch at its workshop facilities. These workshops in Singapore and China have high precision machining centres. All aspects of the production process are, thus, controlled in-house and customisation for customers' requirements can be maximised. This ensures that middleman costs are saved and not passed on to the client. Products are intentionally designed to be modular, allowing multiple benefits, such as exceptional quality control of the manufacturing and fabrication process, reduction in time spent during installation and minimisation of construction complications. Specialised Arsenal of Welding Equipment: These equipment include state-of-the-art Orbital, Infra-Red PVDF, Polypropylene Electroless and Polypropylene Fusion Type machines. Some equipment such as the Orbital and Infra-Red Welding required specialised skills to operate. Such skills are both fundamental and highly sought-after in the water treatment industry. Hyflux has invested substantially in the training and certification of workers operating such equipment. To help cater to the rapid developments in China, Hyflux has invested in new production facilities in Pudong, Shanghai which enables Hyflux to triple its production capacity. These new facilities also serve as sales and servicing centres and administrative hubs. Hyflux also has presence in Guangzhou and Hebei, Shandong, Anhui, Suzhou and Hangzhou. Foundation for Design Capabilities: Hyflux's Corporate Culture "We believe that change is the only constant in an ever-evolving world. By supporting a culture that embraces diversity, a commitment to the integrity of conduct and a strong work ethic, we create an environment that attracts talents who share the Hyflux vision." - Christopher Murugasu , Senior Vice President As a fast growing major player in the water treatment industry in Asia Pacific, Hyflux employs creative individuals by tapping on international talents and leveraging on their unique cultural differences in order to deliver the best value to its customers. However, creativity is rarely fostered in isolation. Thus, besides merely hiring creative individuals, Hyflux treats each employee as part of the family and encourages them to engage in close interdepartmental cooperation and to adopt a hands-on attitude to their work at each level of the organisation. Hyflux is a firm believer in training and in developing its people, and considerable effort is taken to keep the staff updated with the latest in water- 10 related technology. By sending staff for courses conducted by institutes such as the Engineering Research Centre (EERC) and the Environmental Technology Institute (ETI), Hyflux ensures that its staff are wellequipped to handle any tasks their clients require. Hyflux's employees are also certified to exacting international standards set by those of AGRU and Singapore's Building and Construction Authority (BCA). The practice of design and innovative spirit is best fostered in an environment unencumbered by hierarchical bureaucracy. Hyflux believes that change is the only constant in an ever-evolving world. Their corporate culture emphasizes the importance of embracing diversity, a commitment to integrity and a strong work ethic. In addition, this environment serves to attract the best talents who share Hyflux's vision. Hyflux's management has also made a conscious effort to nurture the spirit of entrepreneurship, a value embodied in their CEO, Olivia Lum. According to Ms. Lum, success in her entrepreneurial ventures means thinking outside the box and building a business without boundaries or constraints of standardised business strategies. Dynamism is a key word in Ms. Lum's dictionary and this has a clear positive effect on motivation of the staff. In the course of building a successful corporate culture, Hyflux has managed to create an innate sense of belonging in its employees. This motivates the employees to dedicate themselves wholehearted and give their best contributions to the customers and the company. By fostering creativity and recognising that their personnel are their greatest asset, Hyflux has indeed nurtured the spirit of entrepreneurship and developed a strong and successful corporate culture. Reason for Design Capabilities: Hyflux's Customer-Centredness "They (our clients) have been a constant pillar of strength

and support for Hyflux's positioning and growth in the industry, both in Singapore and abroad." - Olivia Lum, Group CEO and President Hyflux's strong value proposition is the reason behind their fast growth locally and rapid expansion into China. With the aim of being a world-leader in water treatment, Hyflux has established a foothold in the market through growing its market share and expanding its markets into different regions. Hyflux is distinguished from other corporations in the water treatment industry in Asia by one crucial feature - focus on the development and commercialisation of membrane technology. Hyflux's business strategy is designed around the capability of being a provider of integrated solutions. Their expertise includes a full range of services including design, fabrication, installation, instrumentation and control, and maintenance of water treatment systems. As a strong innovator, Hyflux's strong product development and research and development on membrane 11 technology provides a strong foundation for technological breakthroughs and for supporting customers' needs. Hyflux has chosen a business strategy that is clearly collaborative. By approaching each project as a joint-partnership with the customer, Hyflux seeks to create sustainable value for their clients as well as their shareholders. This strategy is augmented through organic growth and synergistic ventures. These symbiotic relationships with customers provide a wealth of experience, stability, global outreach and extensive know-how for Hyflux. Conclusion Hyflux has clearly shown it's standing in the region as a leading player in water treatment and membrane technology. Membrane technology will continue to be its forte. From treatment of water and wastewater to the reclamation of water (NEWater) and desalination, process liquid purification, as well as the production of potable water from ambient air, Hyflux will continue to leverage on this core capability and the tremendous energy and passion within the group to provide customised solutions to its clients. 12