Yong Yoon Kit Associate Director, National Key Economic Area (NKEA) - Business Services

Transcription

1 Yong Yoon Kit Associate Director, National Key Economic Area (NKEA) - Business Services 1

2 The Malaysian Environment has been conducive for growth for businesses Malaysia is ranked 12 th, improving from 14th in the World Bank's Doing Business Report 2013, leaping over other countries with advanced economies. The report includes evaluation of costs, requirements and fees of starting business in each country's largest business city. It ranks a high 1 st on Getting Credit and 4 th on Protecting Investors. World Bank, Doing Business Report 2013 In terms of competitiveness, Malaysia ranks 24th among the world economies, ahead of Brazil (48), China (29), India (59), Ireland (27), the Philippines (65) and Russia (67). It is also ranked 20 th in business sophistication and 25 th on innovation. World Economic Forum, Global Competitiveness Report Malaysia is ranked the 10th most attractive FDI destination in the world in AT Kearney s 2012 FDI Confidence Index. Malaysia moved up 11 position from 21 st in 2010 based on FDI intentions and preferences of the leaders of top companies around the world. AT Kearney, FDI Confidence Index

3 In 2010, the NEW ECONOMIC MODEL was introduced : Making Malaysia A Rich Country, For Everyone &For A Long Time High-Income Target USD 15,000 GNI per capita by 2020 Enables all communities to benefit from the wealth of the country Quality of Life Inclusiveness Sustainability Meets present needs without compromising future generations 3

4 The Economic Transformation Programme was introduced to deliver the aspirations of the New Economic Model GNI GNI USD15,000 per capita GDP 6% growth (CAGR) Focus 12 NKEAS 152 EPPs Competitiveness 51 Policy Measures 6 SRIs & Natural Homes Actions Investment Jobs USD444 Billion Investment 92% Private; 8% Public 73% Domestic; 27% Foreign 3.3 million new jobs Source : ETP Lab Report, NKEA National Key Economic Area, EPP Entry Point Project, BO Business Opportunity, SRI Strategic Reform Initiative 4

5 Tourism Oil, Gas & Energy Financial Services Aviation MRO Palm Oil 12 NKEAs Business Services Shared Services and Outsourcing (SSO) Wholesale & Retail Agriculture to boost the economy Receives extra focus on public investment & policies for growth Education Healthcare Data Centre & IT Green Technology Engineering Services Electrical Electronics GKL CCI Shipping MRO 5

6 This initiative was formulated in the Malaysia lab environment with input from industry players to grow the SSO industry to contribute to GNI, investment and jobs RM 6.4bn RM 14.2bn RM 7.4bn RM 0.4bn GNI in 2011 Baseline growth EPP contribution GNI in 2020 Additional jobs in ,000 Private Investment (RM mil) 2,000 Public Investment (RM mil) 160 Source : ETP Lab Report, GNI Gross National Income, EPP Entry Point Project 6

7 Malaysia has been the Top 3 SSO Location for 8 years in a row Low Cost High Skills Conducive for Business Source: AT Kearney, Global Services Location Index,

8 230 SSO companies employing 60,000+ people across different verticals Regional / Global Shared Services Centres International Outsourcing Delivery Centres Outsourcing Malaysia (Local companies) 8

9 The shared services & outsourcing landscape in Malaysia consists of activities across the multiple service offerings Value Knowledge Process Outsourcing (KPO) Example of Services (non-exhaustive) Market Research, Customer Analytics Financial and Stock Market Research Animation and Digital Design Services Engineering Services Product Design, Research and Development Business Process Outsourcing (BPO) Contact Centre Finance and Accounting Human Resource (e.g. Payroll) Legal Services Sales & Marketing IT Outsourcing (ITO) IT Infrastructure Management Application Development and Maintenance Network and Desktop Management IT Consulting Services Enterprise Applications, e.g. ERP, SCM Source: ETP Lab Report,

10 The value proposition of shared services & outsourcing is shifting from a focus on cost to a focus on value In their relentless drive to create and capture new business value, organizations are increasingly leveraging outsourcing in middle and front-office operations, across multiple functions and endto-end processes Providers Supply True Business Value Demand-Driven Scale and Operational Excellence Labour Arbitrage Supply-Driven Back Office Middle Office Front Office Source: ETP Lab Report, 2010 Client Demand 10

11 Key Global SSO Trends to Shape Our SSO Roadmap in the Outsourcing space... 3 Key Trends to Watch - Outsourcing Social media and analytics Use of social media to deliver strategic outcomes and the ability to turn data into information driving business insights The Cloud The cloud s impact is continuously debated, as more suppliers jump into the bandwagon to provide services in the cloud. The public interest Given the economic climate, all signs point to increased outsourcing in the government to improve efficiency and reduce the cost of operations Source: TPI, CIO.COM, Business Week, Info Barrel, The Outsourcing Institute 11

12 .. as well as Key Trends in the Shared Services space continue to shape the SSO Roadmap 3 Key Trends to Watch Shared Services Vertical expertise, integrated models Clients are demanding from their suppliers to integrate infrastructure, applications and operations by industry Business outcomes Buyers are demanding more from Shared Services and Outsourcing with more efficient end to end process models across geographic locations Captive / hybrid / outsource? Organisations are looking at divesting some of their captive delivery centers abroad and looking at hybrid models between shared services, insourcing and outsourcing Source: TPI, CIO.COM, Business Week, Info Barrel, The Outsourcing Institute 12

13 Projects in the ETP presents a huge upside for companies to capture opportunities, as well as invest in services Outsourcing Maturity Curve (2011) Healthcare : Diagnostic Services Banking, Finance & Insurance Application Development & Management and IT Outsourcing - in the Education / Govt sector Selected ETP projects NKEA / SRI Example Project Investment Value Greater KL/KV Klang Valley Mass Rapid Transit (KVMRT) RM 36.6 bil Greater KL/KV & Financial Services Tun Razak Exchange (KL International Financial District) RM28 bil in GDV RM3.5 bil in FDI Education 1BestariNet RM1.5bil Healthcare Diagnostic Services Nexus in Telemedicine RM 30 mil Business Services Government Government Outsourcing (ITO) RM100mil BPO Business Process Outsourcing, HR Human Resources, F&A Finance & Accounting, ADM Application Development & Maintenance, ITO IT Outsourcing Source of chart: Horses for Sources, State of Outsourcing in 2011, May

14 Healthcare sector : Outsourcing represents a real opportunity in Malaysia The healthcare and pharmaceutical sector provides a wide array of supporting services that provides value creation which can be fulfilled through outsourcing Gartner s Hype Cycle for Healthcare Buyers KPO Radiology and Pathology Reporting Workflows Episode Analytics Drug treatment and effectiveness Patient satisfaction BPO Patient Medical Records Healthcare Insurance Customer Servicing ITO Apps Development Apps Maintenance IT Operations Source : Gartner 14

15 NKEA Healthcare initiative: Creating a diagnostic services nexus to achieve scale in telemedicine for eventual international outsourcing Investment in telemedicine to create scale in domestic radiology and pathology; then leveraging experience internationally. Reduce scan waiting times via online queuing system on facility wait list and redirect patients appropriately. Reduce reading turnaround time by linking participating radiologists and pathologists to distribute workload. Source : PEMANDU 15

16 Banking, Finance & Insurance : Malaysia s strength of accounting graduates continue to attract investment AIA Shared Services HSBC Global Service Center..and others Established in 2009 Activity: Transactional Processing (underwriting, claims), Inbound Customer Service, HR, Finance, IT Currently employs 500 FTEs (2012), to grow to 1,000 by 2020 Servicing 10 countries out of Malaysia Activity includes Trade Services, Securities Services, Credit Management, Payments, Global Banking and Markets Currently employs close to 4000 high skilled worker. Servicing 26 countries out of Malaysia Source: MDeC 16

17 High-value Indian SSO centres has successfully moved up the value chain through years of knowledge of the client s business and developing sophisticated knowledge management internally INDIA Shared Sevices and Outsourcing centres becomes business partners with enhanced service offerings and improved efficiency and effectiveness over time Source : Accenture, Ivey Business Journal, India-Reports.in 17

18 Penang-based companies continue to successfully grow their business through shared services within MSC Malaysia Advanced Micro Devices Global Services (M) Sdn Bhd Jabil Sdn Bhd Started with 221 people in Year 2009, currently 473 in Global Business Process Centre (F&A, HR, Sales, IT, Procurement & Taxation). Serving the Asia Region, Europe, Middle East and Africa (EMEA) and the Americas region. Started with 104 people in Year 2009, currently 524 in operating an ITO & BPO shared services in IT Services and Support, Application Development and Supply Chain Management Penang Seagate Industries (M) Sdn Bhd Started with 96 people in Year 2009, currently 251 in operating an ITO & BPO shared services in Software Development, IT Services and Support and, Human Resource Contact Centre CompuMed Health Logistics Sdn Bhd Source : MDeC, as at June 2013 Providing Specialist Shared Service Medical Call Centre Solution, Medical and Health Data Management Service Solution as well as Medical and health Data Artificial Intelligence Solution, growing from 31 to 108 people 18

19 Working across the board with the relevant implementing agencies, we problem-solve and facilitate investments for Economic Transformation Facilitation Analyst for business Sign Up Registration of Company & and financial plans Tenancies Facilitation Immigration, Visas, Foreign Workers Request for Information customized feedback Market Studies across a range of requirements Financial Assistance customized training & grants Client Management Day to day support of needs Experience Sharing via client visits and interaction Facilities Evaluations across buildings and zones Market Access domestic and international Human Capital Development talent facilitation 19

20 THANK YOU + pemandu.gov.my + etp.pemandu.gov.my + Widen the discourse, follow us on Twitter Sign up for more updates on the ETP