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Picture yourself, three years from today and ask - Where will you be? And how would the movements of the New Economy in Malaysia affect your organisation, and yourself?
`New what?' I heard you ask? Yes, the new economy. The new economy IS the future. And the future is here. It is not all that bad a place. It certainly does not spell the end of life, as we know it. There are opportunities to be reaped. Some |
of us may see our profit multiply many folds as a result of solid planning and execution. Whilst some may just watch it pass by, and some may not even notice the happenings around at all.
Why do the business service providers need to participate in this new economy?
What constitutes, then, this new economy? There are many variations to its definition, but for the sake of discussion, renowned author, Don Tapscott classifies 12 themes that make up the new economy in his bestseller "The Digital Economy". They are:
Knowledge economy (K-economy) - Disintermediation
Globalised economy - Moleculasation
Digital economy - Virtualisation
Networked economy - Immediacy
Prosumption - Convergence
Innovation - Discordance
These 12 themes would rapidly replace the fundamental work of the business world (and as a result of the spill over effect, the social world as well), driven firstly by the advancement of information, communications and technology that make our world a global village today. With the majority of procedures and processes automated, this leads to increased competition, and the pressure to seek for a
cheaper source of factors of production such as land and labour around the world. Couple them together, and you will find that it ultimately results in a borderless world and society, i.e. a globalisation of economic activity.
In the new economy, with the many aids available to you and your neighbour, you will find the continued emergence of small businesses, and the increase in dependency on them, hence, the growing importance of small businesses.
Another key aspect of the new economy that you will probably see is the change in work pattern. People relying more on technology to create a virtual working environment so as to maintain or improve their quality of life, due to the increasing demands of work.
Lastly, with knowledge becoming a power-base, you will find that your consumers of products and services are becoming more educated, playing a more efficient role of the informed producer-consumer. Leading to the social pressure for greater accountability and transparency in the manner you conduct your business affairs.
Lo and behold, while it all sounds as though the new economy would turn your world, as you know it upside down, it does not spell the end with doom.
True and undeniably, the new economy calls for new strategies. A whole new ball game, with new rules and dynamics, of which you must quickly assimilate and play by.
True that it spells undeniable threats, that would prove to be detrimental if you are not alerted to it. Yet within it contains unprecedented new opportunities.
All in all, you will find that in the few short years (or maybe even months), you as an individual business service provider, or as one of many within a hierarchy of providers in an organisation, will be pressured to expand your skills and services beyond the traditional role(s) that you play today. You will find a greater need to expand and move up the economic value chain.
In summary, information based products and services are fast losing value in the marketplace, and are rapidly being replaced with knowledge-based products and services that command higher level of market demand.
What is there, waiting for you?
Where then are these unprecedented opportunities lying today? The opportunities for the business service providers of the new economy in Malaysia can be categorised into four main areas:
1. Knowledge economy Initiatives
Among some of the better-known initiatives in our country under the umbrella of creating a K-economy includes, NITA, MSC, e-Commerce Master Plan, and the Eighth Malaysia Plan.
The thrust of the K-economy will be the assimilation of technology as a power tool to harness knowledge, while spurring learning and growth, through the creation of an information, communications and technology infrastructure and the feeding of funds to breed new ideas in that same space.
The opportunities are then centred on technology and knowledge as the term suggests.
- Incorporate knowledge into your service value chain. It presents differential aspects of the information normally presented, to create a broad spectrum of opinions and information exchange;
- Jump on the information bandwagon. It would cost a substantial amount of investment if you were to go into it alone. But another key word in the K-economy is community. With grants from the government such as Demonstrators Application Grant Scheme (DAGS in short) to build knowledge and e-communities, that is an opportunity for us all to band together to create that community for business
service providers.
- Lastly, maintaining along our lines of `strength in numbers', collaborate on an e-service infrastructure to plug it into our national information infrastructure. Recall that in the new economy, the number of small business owners will continue to rise; hence there would be no shortage of new clients seeking business services in return.
2. Technology Driven Value Chain
Some of the technology driven initiatives come directly under the charter of the Multi-Media Super Corridor, or MSC, as we know it today. Not only does the government aim to create an e-nation with their flagship applications such as e-Government, Multipurpose card, smart schools, and Tele-Health among others, it would like to see its citizens taking on the reins of the technology horse by
spawning technology-centric businesses under the technopreneur development scheme.
The business service providers have a wealth of knowledge, hands-on and book-learnt to share with these budding business owners, albeit in a different industry space. But a business is a business.
- A business service provider is almost always the first person that a business owner seeks upon deciding to crystallise their ideas into a business entity. The opportunity lies in the same rendition of the professional service, but hereinafter, centralising it towards a national cause of assisting in the spawning of thousands of technology-driven and technology building companies under
the Technopreneur Development Flagship;
- The business service providers could also capitalise on the country's development in the technology era by better equipping ourselves for the eventual. Changes in standard operating procedures to new and convenient ones such as e-filing, online training, e-procurement and others are items that are milestones plotted and embarked upon by our government. If they are in step with them, by
preparing the workforce, their customers, their offices, they can gain a competitive edge over their peers who have decided to play the `wait and see' game;
- Another opportunity that many be seen as a threat is the faceless nature of the Internet era. Who knows what goes on after a click of the mouse? In this technology era, as confidence builders and assurance providers, it would only be natural for us to extend our role in the traditional environment into the digital environment with the provision of online trust and assurance services for
online corporate and financial information; and
- Last but not least in the technology driven value chain, a new form of service has been gaining fierce momentum: Business Process Outsourcing (BPO). As most of us are already an extension of corporate entities, BPO would come almost as second nature, which falls neatly in line with one of the features of the new economy as a whole: Virtualisation.
3. Corporate Governance Drive
Since the induction into the world of professional service provision, it has been droned into the subconscious mind of the business service providers that they must uphold the integrity of our profession, through the provision of unbiased and unabashed opinions about the true state of affairs, be it of their clients, or of their organisation itself.
Hence it is the innate nature of being in this chosen profession to be the best candidates to assist in the protection of rights of the people who have shown their confidence in the way a corporation is being managed by investing their monies in them.
With the global call for stricter adherence towards better accountability and transparency, through the flag term of `corporate governance', it has brought out into the open services that they may have inadvertently been providing to their corporate clients.
The opportunities in the drive for better governance includes the provision of professional advice in the areas of
- Strategic Management;
- Human Resource Consultation;
- Risk Management;
- Internal Control Audit and Advisory; and
- Conformance and Compliance Advisory
All of which the business service providers have been trained to do, yet never fully capitalised upon.
4. Globalising Local Professional Services
With the onset of the General Agreement on Trade and Services (GATS) under the World Trade Organisation charter, we are no longer confined to the geographical line that separates a country from another.
The exportation of professional services is something that is very real and has been happening, albeit not on a widely publicised scale. Currently confined to either service firms that has presence in different countries, or firms that have established and conjoined themselves to an international affiliation, with technology as a catalyst, smaller firms can now come into the picture.
Under the wide umbrella term of `exportation of professional services', it can be narrowed down further on some of the opportunities that we can capture and use to generate new profit streams:
- The creation of a technology infrastructure built to capture knowledge and business processes;
- The expansion and coupling of their skill set to provide multi-disciplinary services, a key attraction point to the new economy's value seekers who now seek to have the convenience of a `one-stop' shop;
- Forming knowledge or competencies based groupings in specific areas to tap into the foreign market, i.e. branding for differentiation in services;
- BPO services, with a focus on moving to lower production cost countries with highly skilled human capital; and
- Mental preparation to move away from the `founder-mentality' way of doing business and becoming `investor ready', so as to capitalise on the outstretched helping hands that will come the way for business service industry, very much like ones that happens with the multimedia industry.
Victor Ooi is a graduate of the MIM-MSM Executive MBA (IT & Management) and Chief Executive Officer of Biz Aid Technologies Sdn Bhd. MIM is the national management organisation committed to promoting continuous management learning. Independent, non-political and non-profit, the MIM is also a development centre for enhancing and maintaining professional management standards and
competencies. Inaugurated as a voluntary society in 1966, the MIM continues today to introduce the best in management practices from all corners of the world to our Malaysian companies and serves as a platform for the free exchange of management knowledge and experience. This year the MIM celebrates 40 years of delivering management excellence, having not only grown in stature and membership
support in forty years, but having also established itself as the authoritative voice of management in the country. The MIM's national charter and challenges will require it to be innovative and forward looking to prepare Malaysian
workersand the present and future generation of managers to be able to competently handle and manage new dynamic challenges, enabling us to navigate our way to compete successfully and to achieve our Malaysia 2020 vision of becoming a developed nation.
For more information, contact MIM Customer Service at Tel: (603) 2165 4611, Fax: (603) 2164 3171, email enquiries@mim.org.my or visit www.mim.org.my
