As compared to other ASEAN countries, Malaysia is seeing a huge success rate in business returns as they apply digital transformation initiatives towards business practices and break away from the company silo effect. Unicorn tech companies have certainly jumped on the technological bandwagon, and it’s now time for C-level (chief) executives in other sectors to get with the program. Company silos, the effect of company departments not sharing information with each other, is one of the major hurdles businesses face in Southeast Asia, and considering new approaches to their business methodology is the way to go.
We explore Malaysia as a startup hub in the region
Ahead of the game
Malaysia has been stacking up on tech influence since 1996, and the MSC Malaysia (Multimedia Super Corridor) has been the yellow brick road. By recruiting Alibaba co-founder Jack Ma to install and implement Alibaba Cloud’s City Brain into the city intersections of Kuala Lumpur to track more than 500 cameras across 300 intersections, the city has been able to collect data and images at an unprecedented rate in comparison to any other ASEAN country.
With the addition of the Malaysia Digital Economy Corporation (MDEC), The Malaysian Global Innovation & Creativity Centre (MaGIC), and the Global Entrepreneurship Community Summit in 2017, Malaysia has attracted a gross of Fintech companies including NEXEA – Venture Capital & Accelerator Malaysia and SOCi interested in investing in tech growth. GoJek, one of Malaysia’s most successful Unicorn start-up companies, has based their business model on mobile phone apps, integrating the general public into the tech initiative.
Invest in technology
At Workday’s Discover Malaysia conference held on July 18th, 2019 in Kuala Lumpur, Workday Asia President Rob Wells introduced a study called “Digital Dysfunction in Asia Pacific,” conducted in partnership with IDC Asia Pacific. The case study evaluated the perspectives of 1,000 C-level business leaders in regards to accumulated returns from digital transformation. “58% of C-Level executives reported seeing measurable returns. By comparison, only 47% of companies in Singapore and 34% in Japan had seen returns. Malaysia’s digital economy is projected to contribute 21% of its GDP by 2022.” The reports focus was less on the success of returns and more on opinions where improvements need to happen.
Rob Wells said:
As Malaysia’s digital economy rapidly expands it is great to see that local companies are keeping pace and leading the region in their efforts to digitally transform. Despite this success, there still remains work to do to break down company silos to effect change at an enterprise level.
Investments in technology can help companies disassemble information silos and reimagine the business in a way that allows an organisation to stay competitive in a disrupt-or-be-disrupted world. The advent of cloud technology in Financial and HR management will allow business planning to be more strategic, collaborative and real-time, especially if brought together in one single system for maximum benefit.
The study reports that “when looking at the key challenges to digital transformation, almost half (49%) of C-level executives in Malaysia see organisational silos as a key challenge…47% of C-level executives also cite a lack of common technologies and shared metrics as key barriers to cross-functional collaboration, with more than one third (34%) saying their organisations need to invest more in technology.”
Digital transformation (DX) projects
“The digital disruption is becoming obvious in most industries and the pace of digital transformation (DX) acceleration has heightened. During the first wave of digital transformation, organizations realized that digital technology should be a core part of any business and successful strategy. Today, we are entering into a brand new phase where many organizations have recognized the full benefits of DX and are investing in digital innovations with the intention to disrupt the marketplace.”
In an article written for Digital News Asia, Kiran Kaur Sidhu says the success of DX projects companies must be “digitally determined. Local organisations require a ‘blueprint’ that consists of a unified enterprise strategy, a long-term investment plan based on the principle that digital is inherently valuable to the business, and a single digital platform to scale technology innovations. The key to success in the next few years require changes to organisational structures and mindsets.”
Are we underestimating Malaysia’s startup ecosystem?
As Malaysia leads in seeing returns from DX projects the continued effort to improve is going to require businesses to implement tech at a greater pace. Where countries like Singapore maintain a 90% population which have bank accounts, Malaysia’s population, on the other hand, has only 30% access to credit. That means Malaysia not only relies heavily on Fintech investment but also has to rise to the occasion to deserve said investment. Malaysia has made a great step in implementing the Malaysia Tech Entrepreneur Programme (MTEP) which guides new and established entrepreneurs to learn and focus on implementing DX programs into new and existing businesses. With intention, structure and a thirst for success, we’ll likely continue to see Malaysia lead in success towards digital transformation returns.