February 23, 2024

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Digital economy now contributes one fifth to Malaysia’s GDP

A strategy consulting firm has estimated that Malaysia’s digital economy is worth over RM270 billion. This equates to roughly 18% of Malaysia’s GDP. This makes Malaysia more digitally mature than many other countries in the Asia Pacific region, and also a digital step ahead of several Western economies.

The current Covid-19 crisis and the resulting lockdown have accelerated this growth, abruptly boosting the need for digital shopping, working and connection. The share of GDP coming from the digital segment is expected to reach 20% by the end of 2020.

Malaysia’s progress builds largely on the government’s digital strategy first launched over 20 years ago. Since the inception of the Multimedia Super Corridor (MSC) in 1996, the Government of Malaysia has been persistently promoting the nation’s digital agenda as evidenced through multiple public initiatives such as the National Strategic ICT Roadmap & Digital Malaysia (2008-2012), National eCommerce Strategic Roadmap (2017), Industry4WRD (2018) and the latest National Fiberisation and Connectivity Plan (2019-2023).

According to the report, the large majority of Malaysian companies now use digital as a means to enhance decision making, improve productivity, streamline and automate processes, enhance customer experience or identify commercial opportunities, among others.

Most organisations use technology as an enabler for operational enhancements, including using IT systems (HR, procurement, finance), using digital payments and adopting cloud-based working.

The use of tooling to improve products and services to external stakeholders follows – this includes generally front-end tools for customer engagement such as enhancing company or brand awareness online with digital marketing, search engine optimised websites or an e-commerce platform.

Roughly one-fourth of Malaysian firms use digitisation to augment decision-making – the low uptake is due to the need for more advanced technology, as well as a solid IT infrastructure and people that have mastered topics such as data analytics and artificial intelligence.

Opportunities for growth

Despite the upward trajectory, Malaysia still has a ways to go on its digital journey. The firm estimated that six out of 10 companies still are at the basic digitalisation stage, which spans the digitisation of current work processes from what used to be manual to digitally-enabled.

At the other end of the spectrum, less than one in five companies can call themselves digitally advanced. Companies at this stage have a digital strategy in place which is fully integrated with its business pillars and functions, supported by a culture that embraces digitisation.

Enhancing digital capabilities

As the future continues to grow digital, companies will need to ramp up their digital maturity. However, this is a daunting task for many.

Across all corners of the globe, reports tell of failed IT transformations or systems that are not being put to use. Leveraging their experience in the field, the report’s authors posited several best practices for execution.

First, have a clear strategic digital direction to steer any form of digitalisation initiatives. Digital transformation should not be viewed as a one-off business agenda, but a continuous iteration of current workflows.

Second, start small using a pilot and learn approach. The experts recommend kick-starting digitalisation transformation one transformation at a time, materialising the intentions into actions.

Third, management should take a leading role. The management’s ability to drive and instil the importance of a digitally-powered company is a critical factor to any successful digital transformation. This spans the initial communication to ensure that the digital ambition is cascaded to every employee within the business, through to leading by example, personal commitment and involvement during the roll-out phase.

Finally, Malaysian companies should not overlook the role of human capital. Having the right digital competencies in place is the largest barrier to implementation, followed by organisational buy-in – two factors that revolve around people. This includes ensuring buy-in from employees to lower resistance to change, and upskilling or reskilling existing talent within the company through training.

PARTNER

Qlik’s vision is a data-literate world, where everyone can use data and analytics to improve decision-making and solve their most challenging problems. A private company, Qlik offers real-time data integration and analytics solutions, powered by Qlik Cloud, to close the gaps between data, insights and action. By transforming data into Active Intelligence, businesses can drive better decisions, improve revenue and profitability, and optimize customer relationships. Qlik serves more than 38,000 active customers in over 100 countries.

PARTNER

CTC Global Singapore, a premier end-to-end IT solutions provider, is a fully owned subsidiary of ITOCHU Techno-Solutions Corporation (CTC) and ITOCHU Corporation.

Since 1972, CTC has established itself as one of the country’s top IT solutions providers. With 50 years of experience, headed by an experienced management team and staffed by over 200 qualified IT professionals, we support organizations with integrated IT solutions expertise in Autonomous IT, Cyber Security, Digital Transformation, Enterprise Cloud Infrastructure, Workplace Modernization and Professional Services.

Well-known for our strengths in system integration and consultation, CTC Global proves to be the preferred IT outsourcing destination for organizations all over Singapore today.

PARTNER

Planview has one mission: to build the future of connected work. Our solutions enable organizations to connect the business from ideas to impact, empowering companies to accelerate the achievement of what matters most. Planview’s full spectrum of Portfolio Management and Work Management solutions creates an organizational focus on the strategic outcomes that matter and empowers teams to deliver their best work, no matter how they work. The comprehensive Planview platform and enterprise success model enables customers to deliver innovative, competitive products, services, and customer experiences. Headquartered in Austin, Texas, with locations around the world, Planview has more than 1,300 employees supporting 4,500 customers and 2.6 million users worldwide. For more information, visit www.planview.com.

SUPPORTING ORGANISATION

SIRIM is a premier industrial research and technology organisation in Malaysia, wholly-owned by the Minister​ of Finance Incorporated. With over forty years of experience and expertise, SIRIM is mandated as the machinery for research and technology development, and the national champion of quality. SIRIM has always played a major role in the development of the country’s private sector. By tapping into our expertise and knowledge base, we focus on developing new technologies and improvements in the manufacturing, technology and services sectors. We nurture Small Medium Enterprises (SME) growth with solutions for technology penetration and upgrading, making it an ideal technology partner for SMEs.

PARTNER

HashiCorp provides infrastructure automation software for multi-cloud environments, enabling enterprises to unlock a common cloud operating model to provision, secure, connect, and run any application on any infrastructure. HashiCorp tools allow organizations to deliver applications faster by helping enterprises transition from manual processes and ITIL practices to self-service automation and DevOps practices. 

PARTNER

IBM is a leading global hybrid cloud and AI, and business services provider. We help clients in more than 175 countries capitalize on insights from their data, streamline business processes, reduce costs and gain the competitive edge in their industries. Nearly 3,000 government and corporate entities in critical infrastructure areas such as financial services, telecommunications and healthcare rely on IBM’s hybrid cloud platform and Red Hat OpenShift to affect their digital transformations quickly, efficiently and securely. IBM’s breakthrough innovations in AI, quantum computing, industry-specific cloud solutions and business services deliver open and flexible options to our clients. All of this is backed by IBM’s legendary commitment to trust, transparency, responsibility, inclusivity and service.

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