Push for digitisation in Malaysia amid coronavirus crisis

Event cancellations and travel bans are spurring more companies to embrace digital tools to support remote and flexible working arrangements

The Covid-19 coronavirus pandemic could spur businesses in Malaysia to dial up their digitisation efforts at a time when the global economy is coming under siege by disrupted supply chains and city-wide shutdowns.

Last month, the ASEAN+3 Macroeconomic Research Office estimated that the Covid-19 epidemic could deduct as much as half a percentage point from the economic growth of some of the region’s economies in 2020.

“The impact on Asia’s business environment is undoubtedly huge, with nearly no area of business left untouched by the outbreak,” said Tan Hwee-Xian, a senior analyst at Omdia, a technology research firm.

“Major industries such as aviation, tourism, manufacturing, retail and wholesale trade, business services, construction and real estate are facing steep downturns, with businesses from the epicentres needing to be closed down to curb the spread of the virus epidemic,” he added.

The spillover effect of China’s economic slowdown from Covid-19 has already hit several industries in Malaysia. On 3 March 2020, Malaysia’s central bank cut its key interest rate to the lowest in 10 years to counter the impact of the outbreak on economic growth.

The Malaysian government now expects a drop in gross domestic product (GDP) of between 0.8% and 1.2% for 2020, amounting to a decline of between RM10.8bn and RM17.3bn. This translates to a GDP growth of 3.6-4%, instead of the earlier forecast of 4.8%.

Tan said Malaysian businesses may view the Covid-19 outbreak as a catalyst to sharpen their business continuity measures and change the way they do business.

Amplifying collaboration platforms

With prevention measures against the outbreak released by Malaysia’s Ministry of Human Resources earlier this month, many businesses have implemented measures to minimise disruption to operations and to ensure the safety of workers.

“A lot of attention has also been placed on how workplace technologies can help, with remote working, mobile technologies and unified communications and collaboration tools being essential themes,” said Tan.

“[Facilitating remote working in response to the coronavirus] could provide a massive push for digital transformation [and serve as] a vital test for a broader, long-term move to an innovative culture involving a change to workplace norms”
Tan Hwee-Xian, Omdia

“This could provide a massive push for digital transformation, especially since many local businesses have been relatively slow to adopt flexible working or digital workplace platforms,” he added. “Essentially, this could be a vital test for a broader, long-term move to an innovative culture involving a change to workplace norms.”

However, Tan advised Malaysian enterprises to look beyond technology. “Fundamentally, this is about people, and central to change is human resource management with the HR department reviewing employment policies such as overseas travel, sick leave, absenteeism and workplace closure,” he said. “Flexible and remote working arrangements are now being introduced by more businesses in Malaysia, and these should lead to better, modern working practices.”

Tan said it was important for businesses to monitor the impact of remote working on employees, to make sure that the sudden transition to home working was not detrimental to their well-being and productivity, adding that training and support were necessary to ensure continued engagement.

Tan also called for businesses to educate employees on the security risks associated with remote working. For example, employees should be reminded to avoid using consumer apps to conduct their work.

“Also, device and application management solutions may prove vital in ensuring employees can work securely on mobile devices,” he said, emphasising the need to take a measured and long-term view.

“They should certainly look first at their existing tools to see where there are underused or unused features, such as video capabilities, that will be very useful for remote working,” he added.

“They should also speak to existing vendors and service providers, many of whom will be keen to help – certainly, they should be looking at payment models that avoid capital expenditure.”

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