With new HR tech, Malaysian SMEs can now race with the big boys

SINGAPORE (22 March 2011) – Accelerated world developments ensnare Malaysia in the middle-income trap if SMEs, comprising 92 per cent of the country’s businesses, cannot turbo-charge their growth engines.

Hence, government and business leaders look to technology and succession planning to add much-needed horsepower to innovations that appeal to international investors and sustain global relevance. The recent Malaysian Innovation Agency Act 2010 encourages SMEs to embrace technology for operational efficiencies and scalable growth. Also, the Special Innovation Unit (Unik) was set up to assist SMEs with new technologies.

The middle-income business proposition, predicated by price wars, no longer holds economic viability and sustainability for Malaysia. Prime Minister Datuk Najib Tun Razak said that “we run the risk of being left behind” especially with the country’s loss to China and Vietnam in laptop assembly more than a decade ago due to Malaysia’s higher labour costs, among many others.

Hence to better cope with cost pressures, about 10,000 SMEs have been urged to acknowledge technology as a core component of business strategy. Innovations such as Taiwan’s HTC phones or India’s Tata Nano cars are slowly conquering relevant global markets, which regional businesses can learn from. Increasingly, sophisticated technology can be found in everyday products, for instance, automotive electronics now control vital functions, such as auto-lock brakes and door modules. These advancements create viable market for SMEs, if they adapt quickly.

Furthermore, technologies like SaaS (Software-as-a-Service) and cloud, offer cost advantages that level the playing field, allowing Malaysian SMEs to compete with bigger, more established industry players and vie for significant projects as well as access greater markets previously beyond their scope.

Large, upfront investments are done away with and IT spending of SMEs is fundamentally transformed with monthly pay-per-use SaaS fees that are no more than RM300, contributing to liquidity for expansion. Huge sums need not be set aside for maintaining in-house systems and the cloud itself is compatible with existing Oracle, SAP and PeopleSoft systems.

Where cumbersome on-site hardware installations and costly, frequent upgrades used to be main challenges, cloud does away with hardware/software replacements, server maintenance or repeated backups, making globally ready and productive SMEs.

Most Malaysian SMEs are apprehensive about implementing HR systems, yet cloud computing which e-enables employee inductions, performance appraisals and payroll with only a web browser like Internet Explorer or Google Chrome may just be the solution to fighting cost pressures in an increasingly complex business environment. Technology providers can do more by increasing visibility and familiarising SMEs with mobile alternatives to centralised electronic storage.

Gartner, a US-based leading IT research and advisory company said that the cloud is one technology trend businesses cannot afford to ignore. The cloud system has really taken off since 2008 when more and more businesses saw its advantages. One of the early pioneers, salesforce.com, made a large impact on the US and world market. Dell for example is using their Chatter to collaborate.

Malaysian SMEs like designer shoemaker, Lewre International Sdn Bhd, has transformed itself from being an OEM (Original Equipment Manufacturer) to an OBM (Original Brand Manufacturer) with the introduction of high technology to create high-class workmanship admired by the international jet-setting world of celebrity high fashion, including Jimmy Choo himself. Now, it prides itself on having multinational presence with over 100 stores in 18 countries.

Technology alone cannot successfully drive expansion; strong senior management is also integral to securing bank financing and investor confidence. “Building a strong management team is not only crucial from the standpoint of business sustainability, but in attracting investors and acquiring financial backing,” attested Datuk Stanley Thai, CEO of Supermax Corp Bhd, international glove manufacturer. Datuk Thai recently received the Malaysian CEO of the Year award for 2010, in view of his initiatives in supporting talent to grow his business to supply 11% of the world demand for latex examination gloves in over 145 countries.

SMEs desiring continued growth and expansion should not put succession planning on the backburner. “If we had the vision to start training earlier, we could have doubled the number of leaders we have. With more leaders, we could have more projects, which would mean greater revenue and more expansion,” emphasised CJ See, co-founder of animation studio, Insipedia.

In regards to HR technology, Malaysian SMEs previously having transited from DOS to Client-Server and onto hosted ASP would do well to note that cloud computing including SaaS is no passing cloud.

Perhaps it is about time Malaysian SMEs ask:

• Why the inertia in adopting new HR technologies? Are the reasons justified?

• How do we execute proper succession planning for continued expansion and investor confidence?

• What are some of the advantages and considerations of switching from ERP to SaaS?

• Where do we start to successfully transit from a family business to corporate boardroom?


Find out the latest technological developments in HR and succession planning strategies employed by successful SMEs at the HR Talk Show 2011 on 25 May 2011, Kuala Lumpur.

The HR Talk Show series is a high-impact interactive platform that bridges the gap between the government and business initiatives to drive best practices and actionable insights into talent, technology and strategy. In a unique talk show format, CEOs, HR Directors and CIOs-HR from most admired companies will facilitate thought-provoking questions to ensure that you:

• Drive improved talent productivity and leadership succession

• Cast off accident-prone legacy strategies for talent
management

• Secure a methodology to evaluate and implement HR technology and services

• Resume your role with a greater clarity of thought and vision

# # #

Keywords: SMEs, SaaS, SAP, Gartner, Malaysian Innovation Agency Act 2010, Unik, DOS, Oral, PeopleSoft, cost pressures

The Center for Business Strategy and Tactics (Center for Business) is an industry research centre (IRC) that works to bring top executives together in communities of learning and practice to act as a catalyst for generating high-value energy business insight and channel top expertise to where the world needs it most. Center for Business meetings are powered by Arc Media Global, a B2B/G2B integrated international marketing specialist headquartered in Singapore.

Contact: Eunice Wee
Arc Media Global
PO Box 176 Robinson Road Singapore 900326
(+65) 6844 2080
hrtalkshow@arcmediaglobal.com
www.arcmediaglobal.com/hrtalkshow

This release was published on openPR.