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ICT Services Industry Outlook in Malaysia
Stan Singh
Macro Policy Shift: FDI Driven to
Innovation Driven Economy
Next Economic Major Thrust:
New
Transformation
Endogenous Growth through New Transformation Policy
Policy
FDI
Driven
Growth
Periods
Towards High Income Services
Sector Nation
GNI Per
Capita (USD$)
1970
2009
2010 GNI per capita:
RM26,420 (USD8,256)
Korea
260
21,530
2009 Household Income:
RM4,025 (USD1,183)
Malaysia
380
6,760
1995 GNI per capita:
RM5,406
Until
Mid 90’s
1995 Household Income:
RM2,020
1980 GNI per capita:
RM1,820
10th MP
(2011-2015)
USD12,139
Info-structure (ICT), science, R&D,
knowledge capital, innovation skills, XY
Generations, entrepreneurship and
globalization
1980 Household Income:
RM692
LOW INCOME –
RESOURCE DRIVEN
ECONOMY
2020 Target:
USD21,834
Developed
Economy
Benchmark:
USD14,816
Until
Late 70’s
Land, labour and low
skills
By 2020 GNI
per capita
Infrastructure, Capital, Factory,
Technical Skills and Semi-skilled
Workforce
MIDDLE INCOME –
FACTOR DRIVEN
ECONOMY
HIGH INCOME –
INNOVATION DRIVEN
ECONOMY
Source: DOSM /10th Plan /PIKOM
Process and Human Capital
Strategy
TRANSCENDING INTO HIGH VALUE AND INCOME
CAPABILITY MATURITY MODEL
INTEGRATION FRAMEWORK
PEOPLE CAPABILITY MATURITY MODEL
FRAMEWORK
VOICE OF
BUSINESS (VOB)
VOICE OF CUSTOMER
(VOC)
VOICE OF EMPLOYEE
(VOE)
•Revenue
•Growth
•Profitability
•Leadership
• Governance
• Performance
• Quality
• Cost
• Cycle time
• Reliability
• Integrity
• Transparent
• Responsive
• Accountability
• Responsibility
PROCESS STRATEGY
HUMAN CAPITAL STRATEGY
Human Capital Strategy: From Industrial
Towards Knowledge Workers
1994
MSC
1970
E&E
ICT ERA
KNOWLEDGE/
INNOVATION BASE
ECONOMY(IDE /KBE)
2011
IDE / KBE
Innovative
Digital
Economy
(IDE)
Multimedia
Super Corridor
(MSC)
KNOWLEDGE / INNOVATIVE
WORK FORCE
Electrical &
Electronic (E&E)
Free Trade Zone
(FTZ)
INFLEXION PHASE
INDUSTRIAL
ECONOMY
RESOURCE BASED
ECONOMY
INDUSTRIAL
WORK FORCE
AGRICULTURAL
WORK FORCE
Economic Outlook
Strong Economic Fundamentals
1.
2.
3.
4.
5.
6.
7.
8.
9.
Strong domestic demand;
Increased export earnings;
Stable overnight lending rates;
Stable public and private consumption ;
Low inflation rates;
Low unemployment rates;
Stimulating ICT / ICTS growths;
60% inclined to Asian export earnings
Post GE election stability
Economic challenges
1.
2.
3.
4.
5.
GDP 2012 : 5.2%; GDP 2013 :
5.5%, despite 4.1% in Q12013
Risk aversion by potential investors;
Slack in ETP ;
Reducing fiscal deficit;
Fluctuating commodity based earnings;
Capital flight arising from erratic foreign
exchange fluctuations;
6. Poor quality workforce;
7. Over dependent upon unskilled foreign
workers;
8. Political stability after GE13
Structural Shift towards ICT Services
Year : 2000
Year : 2010
ICT Outlook
Potential Growth Areas
1. Big data analytics – culling out
business insights and intelligence
2. Cloud computing – even applicable to
SME with reduced cost and
maintenance;
3. Mobile devices – stimulates anytime
and anywhere for consumerization of IT
4. Social media - advent of social
business;
ICT Challenges
1.
Mega projects, corridor
developments and transformation
programmes attribute ICT Services
growth
Declining supply of graduates, not
improved;
2. Quality of graduates meeting industry
demands still remain a challenge;
3. Quality and competency standards –
less than 1.5% CMMI & PCMM
certified;
4. Still lack strong R&D, patenting and
commercialization culture, despite
Government incentives and facilities
Share and Structure of
ICT Services Outlook
ICT Services Trade: Exports and
Imports growing exponentially
Transformation projects contribute
significantly towards ICT Serivices
VISION2020
One
Malaysia
Iskandar
Malaysia
East Coast
Economic
Region
(ECER)
Economic
Transformation
Programme
(ETP)
Northern
Corridor
Economic
Region
(NCER)
Government
Transformation
Programme
(GTP)
Digital
Transformation
Programme
(DTP)
Sabah
Development
Corridor
(SDC)
Mega projects :
Kajang – Sg. Buluh
Mass Rapid Transit (MRT)
Sarawak
Renewable
Energy
(SCORE)
Rural Transformation Programme (RTP)
Political Transformation Pogramme (PTP)
ICT Sector Projected to grow at 11% in 2013
Average monthly salary of ICT
Professionals
Salary increase in 2012: 8.7% from RM6240 to RM6784;
Projected growth in 2013: 8.9% to RM7,387
Salary differential by job functions
Those in IT Managerial category tend to earn much more
than in engineering / technical lines;
Senior IT Engineer net 46% higher salary than Junior IT
Hot ICT Jobs
1. Hot ICT jobs still remain very much similar to recent
years; however, predicted fast growing demand for big
data analytics requiring inter-disciplinary skills on IT,
numeracy, statistical and business intelligence skills;
2. Quality and process improvement skills also poised to
fetch higher demand in the near future;
3. Applications like SAP, ERP may lose market share with
similar, simplified and cheaper versions appearing in
countries like China
Regional benchmarking
In comparison to Malaysia, USA pays 2.08 times ; Singapore pays 1.84
times higher compared to 2.26 time; Hong Kong Australia 1.90 times;
Thailand, China and Vietnam paying better remuneration;
By 2018 the salary gap is likely to leveled up among booming Asian
economies – Singapore, HK, China and Vietnam
Job sentiment index
Job sentiment index still remains high, indeed got better
when JECI moved up from 48.8 in 2012 to 49.1 in Q12013
Thank You