Budget 2022: SAP Malaysia looking forward to ‘digital first’ policies to empower businesses, workforce for digital economy

Hong Kok Cheong, Managing Director, SAP Malaysia

KUALA LUMPUR – Given the launch of the MyDIGITAL blueprint earlier this year that lays the roadmap for Malaysia to emerge as a regional leader in the digital economy, SAP Malaysia is looking forward to more policies to support this vision ahead of the National Budget 2022 announcement on Friday, 29 October 2021.

Its managing director Hong Kok Cheong is hopeful that the budget would focus on small-medium enterprises’ (SMEs) readiness for Industrial Revolution 4.0 (4IR) through cloud computing, as well as the upskilling and youth employment to create a future-ready workforce.

Public-private plural partnerships to drive SMEs’ readiness for 4IR through cloud computing

Under MyDIGITAL, cloud services were given a key highlight, with emphasis for a ‘cloud-first’ strategy both in federal and local state levels that will help drive the adoption of cloud services in Malaysia.

Hong said that this emphasis serves also as a catalyst for local companies, especially SMEs, to embrace dynamic consumption, build resilient infrastructure while also leveraging cloud technologies to further drive efficiencies and productivity.

“Public-private plural partnerships are also important to help drive SME readiness, which in turn further encourages innovation and flywheel digitalisation effect for all concerned,” said Hong.

“The SME landscape is especially crucial as many still lag in technology adoption within their business operations. SAP Malaysia hopes that there will be more SME awareness, before increasing uptake on digital platforms,” he added.

According to an SAP study conducted in collaboration with Oxford Economics earlier this year, SMEs in the region find it increasingly challenging to keep pace with uncertainties and external challenges in the current business environment. SMEs surveyed cite difficulty adapting to a rapidly changing marketplace (40%), keeping up with changing customer wants and needs (38%), and difficulty retaining customers or driving repeat business (34%)  as top challenges to meeting their strategic priorities.

In addition, a World Economic Forum (WEF) study released this month states that businesses that were more digitalised tended to be more economically resilient, especially during the pandemic. Business owners with an online presence were more likely to report an increase in savings (24%) and income (28%) compared to those without one (18%).

Hong said that, by first digitising, businesses can then make the transition to becoming ‘intelligent enterprises’ where they can ‘do more with less’, deliver best-in-class customer experience, build resilient supply chains, while inventing new business models and revenue streams.

“Businesses that are adopting a ‘wait and see’ attitude towards digitalisation could be left behind – and may even become ‘irrelevant’. Many solutions that were once the exclusive domain of large corporates have been scaled in capacity – and price – and are now within reach of local SMEs,” said Hong, citing Aspen Glove Sdn Bhd and Baba Products Malaysia Sdn Bhd (BABA’s) as two ‘visionary’ companies that are reaping the rewards of digital transformation.

  • As a new player in the industry, Aspen Glove was up against industry players who have several decades’ worth of experience. To successfully compete, the company selected SAP’s S/4HANA Cloud – Private Edition as the ERP (enterprise resource planning) system for its new glove manufacturing plant in Kulim Hi-Tech Park running 96 productions lines. As a result, it moved beyond smart manufacturing with its Industry 4.0 initiatives, connecting production with end-to-end process execution across the supply chain – so it can reach a new level of connectivity and adapt to change on the fly. “Hence, Aspen Glove is able to revolutionise the quality, customisation and speed of delivery to meet the customer demands of today,” said Hong. (Read more: here)


  • BABA’s, meanwhile, successfully accelerated its digital transformation programme to to become more lean, agile, and resilient. It had transitioned from its previous all-manual, paper-based processes to the SAP S/4 HANA platform, complemented by Direct Store Delivery with CRM (customer relationship management), SAP SuccessFactors and SAP Payroll. As a result field personnel are also able to plan and schedule store visits and deliveries efficiently and improve product placement and in-stock levels, access key information about customers, orders, and deliveries in real-time on their mobile device, while verifying product returns, process orders, and settle bills on the spot, while sharing pricing, promotions, and discounts. (Read more: here)

Building a ‘national future-ready workforce’ through upskilling, reskilling and lifelong learning

Hong also emphasised the immediate need for the upskilling of present employees to become a ‘national future-ready workforce’, especially the youth community and mid-careerists.

“The COVID-19 pandemic has accelerated the need for companies to move towards a ‘digital first’ workforce,” said Hong, adding that he looks forward to training and technology-enabled learning initiatives to be announced within Budget 2022. “Youth employment should be prioritised coupled with initiatives to improve online learning experiences.”

Among others, SAP is collaborating with Malaysia Digital Economy Corporation (MDEC) on the MyUniAlliance programme which provides training for some three thousand students per year. Eighteen higher learning institutes, including two foreign universities, have participated in the programme.

In collaboration with the ASEAN Foundation, SAP also hosts the ASEAN Data Science Explorers initiative at both national and regional levels. The objective, here, is to encourage youths to embrace analytics skills to see through various projects to benefit communities and countries. Just recently, students from Sunway University Malaysia emerged as second runners-up in this regional competition.

Hong concluded by saying that SAP’s vision is to help the world run better and improve people’s lives worldwide – including Malaysia.

In 2022, SAP would have been in Malaysia for three decades.