Thursday, 28 December 2017

INDUSTRY 4.0 2017 - A demonstration of national resilience

In January last year, the world met to discuss the future as seen through the Fourth Industrial Revolution, or Industry 4.0. In July last year, we started discussing its impact, and most importantly, its adaptation within the domestic industry.
In all fairness, nobody expected much after the subdued end to 2016. We celebrated the coming of 2017 with a reduction in vehicle sales, and many argued that we were in crisis mode.
However, we said in January that the automotive industry had developed, a higher level of resilience.
On the national front, we realised that economic uncertainty is no longer an excuse to dismiss strong foundations. Economic policies and budget implementations were designed to allow for greater economic resilience.
It may not have been the most popular way forward, but tax and incentive structures worked towards increasing our value on the global stage. We refused to handout fish but helped people to fish effectively.
This year was that year where we walked the talk and as an industry, continued the implementation towards a new era of global competitiveness.
Despite the economic uncertainty which had been looming since early 2015, exports of automotive parts and components are expected to hover closer to the RM12 billion mark by the end of this year, more than double the RM4.7 billion in 2014.
Energy Efficient Vehicle (EEV) penetration rate rose to 42.3 percent as at last month from 14.1 per cent in 2014. It is expected to surpass the 50 per cent mark by the end of the year, reflecting the growing support for energy efficient mobility.
Vendor Productivity also rose tremendously. In 2014, 315 automotive vendors were ranked at Level 3 or higher, with these figures expected to almost double by the time we hit 2018.
Taking things to a broader level, the progress seen in this year is a reflection of our national economic performance. The World Bank revised Malaysia's gross development product growth forecast for this year to 5.2 per cent, as stronger investments and private-sector expenditure increased - a reflection of strong economic foundations through solid economic policies.
The domestic economy was a key force in economic growth this year, with an average growth of seven per cent in the first half of the year. A clear sign of renewed consumer confidence of a recovering economy.
There is a saying, "Not everything that counts can be counted, and not everything that can be counted, counts". The economic figures mentioned above are important. They are indications of the results we have sowed.
For me, our bigger achievement goes beyond the figures we recorded. Year on year, we strive to improve on our past by looking towards our plans for the future. That often means questioning our current practices, despite how uncomfortable change may be. After all, success always tastes better when it is difficult and challenging to realise.
We chose to be competitive and we decided to achieve it outside our norms. We took bold steps towards our goals.
Despite heated debate, we finalised the strategic partnership between Proton and Geely. Admittedly, our nostalgic fondness of holding on made it a bittersweet milestone. However, we knew that to achieve global competitiveness, we needed to compete as a global player.
So far, we are seeing positive response from consumers and dealers in the brand. It will forever remain a Malaysian brand, built by Malaysian talent with the support of a global partner. There is absolutely no harm in learning from a more experienced teammate.
A key feature of this column was social upward mobility. We have always believed in living within our means, and to reach higher level means to increase the value of the "means". This means moving from the labour commodity thinking to making innovation our commodity of trade.
With tremendous support from the industry and government, we developed more career advancement and business enhancement opportunities. Through our Industry 4.0 implementation, more vendors will have access to advanced product and process design capabilities, and will create more high value jobs for Malaysians.
As we approach the end of 2017, I hope we breach 2018 with renewed spirit and re-engineered thinking. Creativity and innovation should be what defines our great nation, and we compete on our own grounds, with capability developed from within.
The key to not to run away from problems, but face them head on. Remember, one man's problem is another man's business or job opportunity. We are all here to solve the problems of others.
Next year, or the year following this one, will come with its own set of challenges.
Life is a gift for those who appreciate the challenges it brings - take them in with solutions that are fair, factual, innovative, and most importantly, elevate the value of our work in the eyes of our fellow countrymen, society and our Creator.
I wish all of you a happy 2018. May the resilience we have shown bring us closer to our goals in achieving global competitiveness.
The writer is the chief executive officer of Malaysia Automotive Institute.

Thursday, 21 December 2017

STRATEGIC WORKFORCE PLANNING - Commoditising creativity and innovation

In the old order of manufacturing, the higher rungs of upper management were reserved for the most creative in the crop.
The traditional line that determined individual positions on the rungs of the corporate ladder was that those who were able to roll out ideas stayed at the top, and others stayed on the shop floor to heed the commands from the higher floors.
This meant that designs, specifications and corporate planning were mostly discussed among a select minority, while the majority were left to only wonder why they had to do things in a certain way.
The most competitive nations or organisations at that time were those with or had access to cheap labour. In order to maintain this competitive edge, many governments from the countries with lower standards of living used their cheap labour as a commodity.
However, the commoditisation of cheap labour posed a few risks.
Firstly, foreign direct investment have to be managed in order to ensure knowledge transfer of which filure would leave a nation in a dilemma to maintain competitiveness by keeping living standards low.
Secondly, a high dependence on cheap labour commodity desensitised a large portion of the workforce - simply put, a workforce that is highly dependent on instruction can suffer when there is a lack of direction, and will also be risk-averse to newer and unfamiliar business and job opportunities of higher value.
Perhaps, in a time where most business operations are labour intensive, the separation mentioned above bears little risk.
Today, things need to move in a different approach. In a time when artificial intelligence poses a likely disappearance of numerous future jobs, we need to rethink the strategic workforce planning.
For example, the emergence of accounting software - one that automatically calculates your profit and lost, balance sheet, taxes and payroll - is taking over most of the accountant's job. To remain relevant, accountants can no longer play a submissive reporting role, but must possess the creativity and acumen of an entrepreneur from a financial standpoint.
For this reason, organisations must instil and inculcate creativity and innovation in their entire workforce. We can no longer specify everything, while business direction is important, the world has become interconnected and we must build a dependable workforce that can independently deliver tasks with their own creativity and innovation.
The most advanced nations today are those who own creativity, and outsource non-creative tasks to labour commodity markets. The reason is simple - creativity is the new hot commodity.
While it is easy to lament the rising cost of living, we must not forget that the cost of living of advanced nations are much higher, perhaps fivefold, than that of our nation.
It's simple - we must live within our means. A cup of Starbucks is cheap in the United States, but for us to have similar purchasing powers, we must look at changing the "means". We must look at opportunities to enhance our value, so that we live within much better means.
Let us create space to be creative. As individuals, it is important to be fair to facts and decisions. The best results usually come from those who have analysed all sides of the coin.
To business leaders, allow and encourage new ideas and management freedom, judge your team by their results and not their time.
If you succeeded in achieving this challenge, please accept my heartiest congratulations. However, if you need help, the government is ready to help your team with creative and innovative needs.
The writer is the chief executive officer of Malaysia Automotive Institute.

Thursday, 14 December 2017

AGE OF INFORMATION - Working together towards nation's development

The current age of digital broadcasting allows anyone to voice an opinion at the click of a button.
While it is a celebration of the expansion of our democratic rights as citizens, the sheer volume of information has changed the landscape of how we perceive certain issues.
On social media, the news sent to end users are based on algorithms that depend on trending information, giving significant advantage to sensationalist marketing techniques and those with significant online presence and influencer capabilities.
The age of information poses the highest levels of misinformation ever seen.
To progress through the current uncertain economy, we must allow ourselves the space to move out of headline-based reading to look at issues holistically, and address the issues more specifically.
Last year, we recorded a gross national income per capita of US$9,850 (RM40,188), inching closer to within 19 per cent of the US$12,235 set by the World Bank as high-income nation status.
Overall, the median household income for all groups of bottom 40, middle 40, and top 20 increased last year by 6.6, 6.9 and 6.2 per cent, respectively, versus 204.
MasterCard also predicts that Malaysia is expected to record the highest ratio in outbound travel in relation to the total number of households with 198.7 per cent by 2021 from 178.4 per cent last year.
These are a few of many indications that Malaysia's economy is creating opportunities for income generation.
Agreed, there are problems that need to be addressed as any economic uncertainty will cause public anxiety about cost of living, business bottom line and career opportunities.
However, unnecessarily negative outlooks are counterproductive when taken in a general sense.
Sensational angles have the power to alter perceptions - mismatching symptoms to root causes that have nothing to do with the problem at hand.
Generalist approaches to complex matters kill any chance to address real concerns as solution need to be specific to the nuances of the problem.
To fairly address the economic situation, it is important to recognise those who are truly in need of assistance based on factors, such as geolocation, career prospects and education levels, in order to better understand barriers of access to opportunities that offer upward economic mobility.
While there are valid grouses that require addressing, some problems can also be self-inflicted.
While household dept to gross domestic product ratios have eased last year, a worrying trend of bankruptcy cases is emerging among the middle class - 60 per cent of insolvency cases are among aged 25 to 44 over the last three years.
In order to climb the economic ladder, it is important for us to be mindful of our expenditure.
In order to further enhance our standard of living, something we all want - we must put ourselves in situations that provide us the opportunity to move up.
Numerous government programmes have been instituted to bridge income gaps and move those less fortunate.
Quality job prospects and ample business opportunities have been created to spur economic growth and elevate the lives of Malaysians as a whole.
However, this elevation is not possible if these opportunities  are not met with competitive spirit, prudence and resilience to lifestyle fads.
Let us look at problems specifically and objectively. Itis often easy to dwell on popular perceptions.
However, true responsibility lies in working together towards our nation's development.
We all have different means and resources available to us, it is important to use them wisely to elevate and influence others towards true  progress.
the writer is the chief executive officer of Malaysia Automotive Institute

Thursday, 7 December 2017

AUTOMOTIVE INDUSTRY - Matching growth with changing trends

Consumer confidence in the automotive industry seems to have rebounded this year compared to last year, which was mired by economic uncertainty due to the appreciation of the US dollar.
Even though dollar levels are arguably still not ideal, it seems to have not hampered industry growth as a whole - particularly due to strong economic principles that have been created since the the 2014 launch of the National Policy which developed specific focus on competitiveness and the gradual liberalisation of the industry.
These setbacks did not hamper the creation of employment within the industry - 87,382 new jobs were created since the policy was introduced, of which 39,819 jobs were created through the Human Capital Development programmes undertaken by Malaysia Automotive Institute.
Exports of automotive parts and components rise to RM11.2 billion last year, with August figures indicating a higher performance this year. Total industry volume figures until last month had shown slight improvement in domestic sales compared with last year.
The manufacturing sector in Malaysia has shown its best growth since the beginning of the year, as indicated by Nikkei Malaysia's manufacturing purchasing managers' index.
Malaysia has developed its foundation to remain resilient in tough times.
Despite facing one of the toughest foreign exchange challenge since its last economic crisis two decades ago, economic indicators are pointing to a faster rebound rate - a clear signal of economic fundamentals leading to stronger resilience.
However, as times change, so do trends and norms. The fundamentals of today may not be the same as tomorrow, requiring us to quickly shift to ensure that businesses cater to future demands, backed by human capital and technology that can deliver to such demands.
It is for this reason, numerous programmes have been developed by the government to ensure such a transition takes place efficiently.
One of the key realisations is Malaysia's shift from dependence on commodities towards participation in higher yield global value chain.
As far as the manufacturing sector is concerned, this commodity dependence has traditionally thrived on cheaper labour costs.
Current trends, however, indicate the quality of the job market must begin to revolve around skilled, creative and innovative labour pools.
The advent of the fourth industrial revolution will in essence force labour intensive sectors into the lower rungs of economic yield, should there be no change in operational thinking.
Without oversimplifying the matter at hand, the early symptoms would be a slow response to automation.
A shift towards this has been implemented by the government in its recent budgets, moving towards Technical and Vocational Education and Training (TVET), 2U2I initiatives and apprenticeship programmes within the public technical universities and agencies.
This change in education mindset is expected to alter the path of formal education to include automation-oriented skills and knowledge and prepare graduates for immediate relevance in the job market.
Such a shift must also be planned together with the operations systems of the industry.
While there is a clamour for more qualified and relevant graduates within the workforce, it is important for industry players to create the space for such careers to thrive and progress.
In summary, we have demonstrated the Malaysian spirit of resilience - the setbacks that we have faced have taught us lessons to become stronger.
Let us keep this positive outlook and move forward and create an ecosystem for all of us to stay relevant and remain competitive.
The writer is the chief executive officer of Malaysia Automotive Institute.

Thursday, 30 November 2017

AUTOMOTIVE INDUSTRY – Perodua’s success story built on support of NAP, Malaysians

Come January, the National Automotive Policy (NAP) 2014 will reached its fourth year of implementation.
From the onset, the common goal was straightforward – to create an ecosystem in which healthy competition could spur the creation of businesses and jobs that had the competitive instinct and capability to match customer expectation sustainably.
The policy was a product of all views. When it was announced, we knew it was not a path laced with roses. We knew there were thorns.  In order to stay competitive, changes had to be made by all. Investments were not only monetary, but they also included investment of mindset, culture and time.
In fact, those thorns grew sharper than expected. A year into the policy, significant gains were seen. Car prices became competitive, exports started growing and vehicle sales reached an all-time high, only to be hampered by an uncertain economy and shocks in foreign exchange rates.
Short-term setbacks  are part of the business cycle. The development of capabilities and the competitive spirit, however, cannot be eroded by economic fluctuations. For me, that progress is more important. Tough times never last, but tough people will last.
With this in mind, I am glad that this is one of few occasions I am not writing about what has to be done, but what has been done.
Last weekend, I took time out of my schedule to visit my mother in Nilai.
The ride was smooth, serene and most importantly, felt very safe. Most of all, this level of comfort was provided to me by the ingenuity and talent of the Malaysian people.
The new Perodua Myvi felt spacious, has luxurious handling and surpasses expectations.
It comes with a five-star New Car Assessment Programme for Southeast Asian Countries Rating and the variant I own comes with advanced safety assistance - pre-collision warning and braking, front departure alert and pedal mis-operation control.

These features are available in the entry-level model, bringing advanced safety features to all. It is also one of the most efficient vehicles in term of fuel consumption.
The Myvi is designed by Malaysian engineers. I can attest that it was no small feat and took years of hard work, innovation and an immense learning curve. It also required the company's leadership to take bold and ambitious risks in order to deliver.
Last but not least, it required the tremendous support of local vendors - 90 per cent of Myvi components were developed by Malaysian automotive businesses.
It all started with a policy - one that needed the buy-in and support of all. I am thankful that despite the challenges we faced, the spirit and support did not fade.
I hope all Malaysians can go to the nearest showroom and admire the hard work we have all put in to deliver a more competitive automotive industry.
Spend some time testing the car, feel its comfort and the advance features. It is not just a product, but a proud philosophy built by fellow countrymen.
All that is left to say is, my congratulations to Perodua, its vendors and Malaysia.
The writer is the chief executive officer of Malaysia Automotive Institute.

Thursday, 23 November 2017

ISLAMIC PROGRESS - Being competitive globally is the real struggle

The eighth to 13th centuries were known as the Islamic Golden Age. It was an age where Muslims dominated the pursuit of knowledge and technology that influenced the sciences and engineering in the modern age.
Modern science and mathematics are today based on the works of those such as Muhammad al-Khwarizmi, Ibn Muadh al-Jayyani, and Ibn al-Haytham.
Ibn Zhur, Ibn Sina and al-Zahrawi were among the early founders of breakthroughs in medicine. Let’s also not forget  those who built great Islamic cities, monuments and buildings that have become global icons today.
There is countless historical resource that narrates the Muslim role in the modern progress of technology and knowledge. However, it is discomforting that one of the core concepts that dictates the goals of Muslims – the word Jihad – has been hijacked by some claiming to be ambassadors of Islam, equating it to terror, tyranny and the progress of Muslims only through the sword and subjugation.
In its true sense, the struggle that is enshrined in Islamic Jihad is about the movement of civilisation towards achieving greatness. It need not mean a comparative greatness, as achieving global heights can come hand in hand with the success of others around us in the same space. It simply is the ideal that we are continuously moving forward in a direction that elevates us to a higher level throughout our co-existence.
This week, the World Islamic Economic Forum (WIEF) is held in Kuching with the theme “Disruptive Change: Impact and Challenges”.
A key point of discussion was the digitalisation of the economy, particularly those of Islamic nations.
As one of the leading Muslim nations, ranked first Thomas Reuters’ Global Islamic Economy Indicator – we sit in a position of responsibility to bring back the peace-loving, technologically renowned civilisation we were once recognised for. Our digital transformation programmes speak for themselves – the e-commerce sector generated RM9.53 billion in revenue.
Our automotive industry is one of its kind in the Muslim world. We have two national carmakers capable of their own designs and development, employing more than 700,000 Muslims and non-muslims working towards the same goals.
Most importantly, the Muslim renaissance is all-inclusive, and is demonstrated through the list of speakers at the WIEF.
The demands of the Fourth Industrial Revolution requires us to learn from all sources of information, regardless of background or faith, in line with the Prophet’s teaching of the borderless pursuit for knowledge.
Since the turn of the century, Muslims have struggled to defend our way of life. We have been subjected to labels of religious fanaticism, backwardness and barbarism.
We have something to prove to the world. We, too, are progressive and are willing to participate in the world economy on the same terms. We need not fear competition and our jihad is to be competitive. Let us prove that Islam is a religion of peace and it transcends time. Knowledge, technology and economic competitiveness is part of our life.
The writer is the chief executive officer of Malaysia Automotive Institute.

Thursday, 16 November 2017

2017 MALAYSIAN AUTOSHOW - A thank-you note to the automotive industry

The 2017 Malaysia Autoshow closed its curtains last Sunday, with more than 250,000 in attendance.
When the idea fully government-backed annual motorshow was mooted more than three years ago, little did I expect the show to grow so much within such a short span of time.
Recently, there is rising belief that vehicle showcases have lost its relevance. Some argue that the cost outweigh the benefits, while others argue that the amount of news coverage on the Internet is enough to provide necessary information to the public all year around.
To be frank - I truly beg to defer.
The global automotive industry is going through its most rapid revolution.
We've seen this before in an other industry when the mobile phone suddenly emerged as a lifestyle tool: hundreds of contraptions combined into a singular devide, addressing numerous daily problems from basic arithmetic to hailing taxis to get to the airport on time.
Cars now need to evolved in the same manner. Perhaps, when we were busy driving our own cars for the last century, it wasn't really an issue.
However, as self-driving cars are getting closer to commercial reality, we will surely start considering what we will do with all that free time!
Therefore, consumers of the Malaysian automotive market must also see - and experience - this change in trends. There is no better way than the autoshow, which allows such experience to ultimately turn into the initiation of the purchase decision, all in a single location.
It is a purchase decision with the ultimate array of choices for the consumer - a first-hand explanation by numerous brand dealers, followed by test drives along the 3km test track at the autoshow's new home on the Malaysia Agro Exposition Park ground in Serdang.
With that, I'd like to convey my heartfelt gratitude to all industry players. Thank you to the original equipment manufacturers who, on their own accord,put up a great display for visitors, from test drives of latest energy efficient vehicles models all the way to driving experiences on custom-built off-road tracks, which maximised the customer experience for visitors, particularly in the area of vehicle safety technology.
My deepest gratitude to the vendors and after-sales businesses who paved the way for a deeper appreciation for the industry, allowing Malaysians to understand how these sectors contribute tothe grander scheme of the industry - the biggest pool of high technology jobs and business opportunities in the industry.
A round of applause to those who made the Kuala lumpur International Automotive Symposium (KLIAS2017) and the SoundValley Festival 2017 a tremendous success.
They were amazing introductions to the autoshow, and brought together automotive experts and music lovers into a single locsation - a symbol of the ever-evolving culmination of motoring and lifestyle we expect to see in the future.
The autoshow would not have grown without the full support of the Malaysian government, through the International Trade and Industry Ministry.
Thank you for your undivided attention to the autoshow for the last three years, and it is our pleasure to keep this momentum going with your continued support for the automotive industry.
To my team - the core talent who made all this happen - there are no words to describe how proud I am.
From our beginnings only seven years ago, to maintaining the passion, dedication and competitive spirit needed to organise the largest motor show the nation as seen, is truly remarkable.
Lastly, I thank The Almightly for His grace and blessing on all proceedings.
Congratulations to all who made the 2017 Malaysia Autoshow a huge success, and we hope to see you again next year!
The writer is the chief executive officer of Malaysia Automotive Institute.

Thursday, 9 November 2017

MALAYSIA AUTOMOTIVE - Revving up local energy-efficiency culture

By the time you read this article, the Malaysia Autoshow 2017 would have opened its doors to visitors. The autoshow will run from today to November 12 2017 at the Malaysia Agro Exposition Park in Serdang (MAEPS).
The event is in line with the National Automotive Policy 2014 (NAP2014) focus of making Malaysia the regional hub for Energy Efficient Vehicles (EEVs).
To become an EEV hub, it is not only about design and production, but also public buy into the idea of energy efficiency.
While the government has received tremendous support from original equipment manufacturing and industry players towards the EEV direction, it is important to also receive public buy-in and support for energy efficiency at all levels.
The Malaysia Autoshow 2017 will continue to spur growth of the culture of energy efficiency, through the various programmes and activities planned at the event. This year, the government is aiming to attract 250,000 visitors, and to maximise its potential, decided to move this year's show to the vast grounds of the MAEPS.
This year, 170 exhibitors will showcase a wide range of products and services from the various sectors that make up the automotive ecosystem.
Similar to any motor show of global standing, they are here to allow participants to experience the full breadth of the automotive economy.
Most importantly, the Malaysia Autoshow serves as a testament to the number of chioces given to consumers. It signifies the government's commitment to showcasing mobility solutions that are increasing in fuel efficiency, safety and security.
For this very reason, the activities at the Malaysia Autoshow is structured to allow Malaysians to gain first-hand experience of the mobility solutions on offer in the market.
Visitors have the opportunity to test-drive various models from different brands in the true spirit of consumer choice. The test drives take place on a 3km test route, so visitors can truly experience the models they are interested in.
Not of all of us, myself included, are privy to the experience of premium models. For a small fee, the Malaysia Automotive Autoshow provides this experience through models such as the Bentley Bentayga and Ford Mustang.
Adventurers seeking an extreme off-road experience can catch the 4x4 Taxi Ride.
Meanwhile, those with a taste for motorsports can try the Karting Slalom - which is open to visitors aged eight and above.
Running concurrently with the Autoshow is The Kuala Lumpur International Automotive Symposium (KLIAS 2017). KLIAS 2017 is an annual meeting in Malaysia of global automotive professionals and players.
This event also serves as a platform for market experts to gather and share the latest trends, technologies, advancements and policies in the industry.
For those seeking career opportunities, they can visit the KLIAS Career Fair on the last two days of the Malaysia Autoshow. Around 3,000 vacancies are available to those interested to join the industry.
Additionally, The SoundValley Festival will also be held in conjunction with the Malaysia Autoshow. SoundValley Festival 2017 will feature eleven local and internationally renowned bands from Malaysia, Indonesia, Japan and England.
This combination will provide a lively ambience for all visitors to the Malaysia Autoshow 2017
The writer is the chief executive officer of Malaysia Automotive Institute

Thursday, 2 November 2017

FEDERAL SPENDING - Vital to continue funding long-term development goals

The government's attitude towards federal spending has changed significantly over last few years.
Firstly, there was transformation in the way government revenue was generated through the implementation of the Goods and Services Tax in 2015.
Despite numerous polemics, it is one of the lowest rates for value-added tax in the world, with a high number of zero-rated essential goods and services.
Compared to the previous Sales and Services Tax, revenue increase more than twofold. This increase was due to the introduction of a tax model that allowed for a broader tax collection base, reducing loopholes through more accurate tax reporting and improved measures to combat tax evasion.
Secondly, the age-old subsidy model gradually evolved to allow better targeting of those who really needed them. Along with fuel subsidy restructuring, the government introduced numerous cash returns to the bottom 40 per cent household income group.
However, the impact of this additional government revenue was offset by the appreciation of the US dollar against the ringgit in 2015. It was clear that the nation was highly dependent on imports and the domestic economy, and higher value economies needed to be generated that spurred import substitution.
To add salt to the wound, the drastic drop in oil prices further offset government revenue.
It is therefore significant that a large portion of the 2018 Budget continues the allocation for long-term development goals, with key focus on digitalisation, Industry 4.0 and national transformation by 2050.
For example, RM46 billion, or 16 per cent of the budget, has been allocated for development expenditure. Education received RM61 billion, or 21  per cent, which is much higher compared with countries such as the United States, the United Kingdom and Germany, which ranges between two and 17.6 per cent. Ten per cent of the 2018 Budget goes to healthcare, examplifying our world-class public healthcare system.
Naturally, the benefits of the above do not manifest themselves immediately. It is also rare to be excited about benefits that will come in the future. Not many say they are excited about going to school, but know they must go in order to secure a future of high value. Long-term planning is never sexy. Yet, without it, our upward mobility and competitive edge would definitely be lost.
This year's budget will allow more development enhancement within the automotive industry, in line with Malaysia Automotive Institute's (MAI) four pillars - job creation, career enhancement, business opportunities and business enhancement.
Next year, MAI aims to create 5,000 semi-skilled jobs in line with Technical and Vocational Education and Training. Another 1,730 skilled jobs will be created through MAI's career enhancement programmes focusing on digital engineering, quality management and advanced process design.
More than 300 parts and components manufacturing will undergo enhancement in line with Industry 4.0 in key areas of product design, smart manufacturing and automation capabilities. Futhermore, 1,000 automotive workshops will be enhancement to boost the performance of the after-sales sector.
These programme and the continuation of the National Automotive Policy are geared towards further improving import substitution and exports. Next year, we are aiming to increase localisation to RM11 billion from RM9.5 billion this year, and exports of automotive products to RM13 billion from RM12 billion.
November is that time when businesses start detailing their internal budgets, and it is also when we look at ways to enhance our careers for next year. I invite you to speak to us on further enhancing ourselves to brave the new frontiers of 2018. Speak to us now, and we can get started immediately.
The writer is the chief executive officer of Malaysia Automotive Institute.

Thursday, 26 October 2017

POWERTRAINS - The case for electrification, sustainable mobility

The story of modern powered vehicles began in the late 19th century, when the four-stroke cycle engine was built in 1876, with Karl Benz starting the first commercially produced motor vehicles a decade later.
At the time, the vehicles running on internal combustion engines were subject to the same challenges we face today with alternative powertrains - there was a distinct range anxiety and refuelling options.
Perhaps many are also unaware that during this time, the internal combustion engine faced competition with two other powertrain designs - the steam engine, as well as the electric vehicle (EV).
At the time, internal combustion engines shared a similar market share with electric vehicle, with the rest dominated by steam powered engines.
However, the next few decades saw the demise of electric mobility, as internal combustion engines won the battle in overcoming the anxieties of motorists - it was modestly priced, easy to maintain, travelled long distances and ran on a readily available source of energy.
EVs required bulky batteries, had short storage life and could run less that 100km. The mass production of petrol vehicles by Henry Ford further closed the chapter for EVs - as fuel costs and environmental concerns have resulted in uncertainty in the viability of fossil-fuel based transportation.
While more efficient internal combustion engines made way into the market to address the issue of fossil fuel dependence - alternative powertrains, in particular electric vehicles, are increasing in popularity as a solution to future mobility modes.
Many carmakers took large risks in developing such technology, as the development of EVs are not just subject to consumer range anxiety - the key reason for its historical demise - but also the infrastructure and power grid issues.
A century ago, it was about a few people wanting to move as fast and as far as posible. Today, however, it is about billion of motorists searching for the solution to sustainable mobility.
At least we are clearer about the EV direction than we have ever been.
Numerous cities around the world have set targets for zero vehicle emission within the next one or two decades. This will definitely come with the commitment of improved and more environmentally-friendly power generation and distribution technology in the near future.
While battery technology has improved in terms of weight and energy storage capacities, new breakthroughs are also seen in charging capabilities - charging times are now reduced, and on board charging technology, such as fuel cell and regenerative braking, are gaining traction.
Understanding and adapting to these developments are of high importance, especilally for a car-producing nation such as Malaysia. It is for this very reason that energy-efficient vehicles emerged a core feature in the National Automotive Policy 2014 (NAP2014).
More importantly, the electrification of transportation is not just about powertrains.
This version of electrification now comes with an added twist of "electronification". Simply put, today's electric mobility solutions that complement electric powertrains, such as autonomous driving, advanced sensors, data connectivity and integration with intelligent urban transport systems.
The NAP2014 will be reviewed from time to time to ensure that it stays relevant to the capacity enhancement needs of the domestic industry. I look forward for feedback from all stakeholders on how we can create an industry that can respond to disruptions within the global automotive markets.
The writer is the chief executive officer of Malysia Automotive Institute

Thursday, 19 October 2017

GAME OF GLOBALISATION - Modern battle and its roots in tradition

The celebration of Deepavali, or the festival of lights, finds it roots from Hindu legends that romanticise the triumph of light over darkness, good over evil, and knowledge over ignorance.
Similar to any belief system, Islam included, religions advocate the derivation of success from overcoming negative elements, be it internal or external. It is the concept where evil is characterised as elements that distract us from a proper, or good way of life.
As we sink into our festive moods, I'd like to take this opportunity to relate this age-old concept to the modern daily and professional times we live in today.
Traditional stories of physical wars are obviously an obsolete form of competition. While the barbaric notion of wars involving massive life loss has been replaced with peaceful convention of highly civilised diplomacy, competition is still a relevant and healthy notion - the healthy competitionof ideas, innovation and industry preserves human curiosity and promotes progress of society.
Many articles in this column have discussed the need to develop internal capacities that meet global needs. However, actual quality and perceived quality are two different beasts that need to be tamed in each organisation.
While market size is an important factor, we find many businesses struggling to sell even if they are located within those markets. In a world of around seven billion people, only a handful of brands own a sizeable share of the global smartphone market, with Samsung and Apple holding more than a third of global brand loyalty.
In the 90s, a phone was used mainly for calls and text messages. The major mobile phone brands seemed content that their innovation from wired to wireless communication was revolutionary.
When the iPhone was introduced, it set an entirely new belief system in mobile phones - they traditional from mobile communication devices to a comprehensive lifestyle assistant. Apart from calls and texts, they hailed taxis, gave us cooking recipes, allowed us to watch video and listen to music on demand, and such more at the press of a virtual button.
Today, modern battles are fought to win the hearts of consumers, and those who are able to do so are the winners.
Is it impossible for us? The answer is simple. Was South Korea always known as a car manufacturing? Did Tesla emerge as a spin-off from a major carmaker? Was Alibaba the first e-commerce platform? Major brands did not emerge from just having excellent design teams, large factories or innovative supply chains. While these capabilities are undeniable, the X-factor to their success was the ability to match their products to those who needed them, creaating new blue oceans for them to succed.
In today's era of marketing, saying everything is saying nothing. As businesses, we must be able to identity, in specific detail, what are the solutions we are providing to our clients.
In the fourth industrial revolution, being a big player is no longer a proven advantage. Technology has allowed smaller, leaner entities to find the needed wiggle room to penetrate global markets. The most important is to reach customers and markets that match the strengths of your business and develop a positioning that propagates loyalty through strong customer belief and perception.
The game of globalisation has changed for the betterment of all, and before we fight the good fight, we must believe first and foremost in ourselves.
I'd like to take this opportunity to wish all Hindus a happy Diwali
The writer is the chief executive officer of Malaysia Automotive institute

Thursday, 12 October 2017

PRODUCT CUSTOMISATION - Current advanced practices future fundamentals?

It's funny how American potato chips command a higher price compared to our local chips made from bananas or tapioca.
Processes are most likely the same, yet they differ in perception or "status" as the preferred snack between meals.
The basic principle behind the success of a product is value, with production cost often irrelevent to the purchasing decision of the consumer. Simply put, we will part with our hard earned money when the perceived value of a product or service is equal or exceeds its price.
Perceived value is not just derived from quality and pricing alone. It is also a function of the consumer psychography - the experience, stature, financial flexibility and also the customers' level of need.
It is not surprising why most economocally-developed nations not only possess strong foundations in the optimisation of their manufacturing or service operations, but also have developed an understanding in the psychometry of their customers by tailoring their products to the behaviours and purchasing decisions of different market segments within their ecosystem.
The free market and liberal economic world view, prevalent in the latter half of the 20th century, was perhaps a product of this understanding of consumer behaviour. Naturally, businesses with access to larger markets attained a wider reach for their tailored products and services, and faired better within the globalised economy. With diminishing economic borders in the 21st century, this equalled the playing field between nations with different population size.
As we progress, one key disruption to conventional economic theory was the advent of e-commerce. Connected globalisation had somewhat equalled the playing field between big businesses and small players.
Key examples include Lazada and Facebook, Internet companies that grew in the shadow of much larger competitors to emerge champions of their targeted markets. Interestingly, these companies grew in size with one specialisation - they owned customers without having their own products. They partner other companies, each with their own specialisation, and the interdependence of these large network of businesses contribute to the success of each, perceived as a single brand or entity.
The world speaks of the global value chain concept. As products and services grow in complexity due to technological advancement, it becomes impossible for an entity to invest in all specialisations to bring forth a particular product to the world.
With specialisation being the key word, here, it doesn't matter if you are a car manufacturer, a textile trader or a tapioca chip procuder - your specialisation needs to be matched to the appropriate global value chain for any chance of global success.
Failure to customise products in a world that is growing ever much closer to mass customisation - honing down to specific consumer analytics - may diminish the perceived value of products that are our comparative advantage.
I believe that a shift in focus is required, here, in which funding and government policies must evolve not just in line with changing trends, but rapidly changing economic norms. While fundamentals of marketing and business will remain, business models must keep up with changes in the "rules" of the game.
The best player may no longer score points when the rules of the games change.
The writer is the chief executive officer of Malaysia Automotive Institute.

Thursday, 5 October 2017

SOCIAL MOBILITY - Reaping The Fruits of Soaring Economy

One of the key notions in this column has been the ability to adapt to change. Adaptation to change is not just about survival, but the core fundamentals of emerging as a leader that sets the trends, and nor merely sailing with the winds of change.
Whether or not the sentence above reminds you of the golden days of German rock bands, the point is that Malaysia in must now transition from a nation that adapted to global trends, to an economy that has the ability to set those trends ourselves.
PricewaterhouseCoopers (PWC) forecasts Malaysia to be within the top 25 largest economies in the world by the year 2050.
While this is a good indicator of the growth of our economy, it is based on GDP per capita (PPPs), which therefore requires us to fill in the blanks on fair distribution of wealth in view of our economic growth over the next three decades.
One of the key ingredients to achieve this is the sustainable participation of all walks of life in the Malaysian economy. Whether or not you are a business owner or employed, every Malaysian must be given fair and equitable access to economic participation, but also an environment to develop capabilities and talents in their careers and achieve greater social upward mobility.
To propel ourselves to greater heights, it is important to grow our regional and global presence within the economic arena. I’ve mentioned in numerous articles in this column that achieving sustainability in a liberalised economy is the best bet forward, and economic policies should be geared to assist businesses and people from gaining assistance.
Conventional economic theory dictates that managing our “comparative advantage” is key, i.e. we should venture only into areas that we have a significant advantage over, such as labour costs, logistics and raw material availability.
However, as conventional economic borders are quickly diminishing and business modes changing, conventional wisdom may also need a system update. Economic policy must also gear towards developing such comparative advantage as the diversification allows for faster reallocations should our economic dependancies become obsolete due to rapid economic disruption.
Apart from consistent, forward looking economic policies, the government has implemented countless initiatives to guide business and individuals seeking opportunities to participate in the new economic order, spurred by the fourth industrial revolution.
Examples include the continuous investment and robust development in digital technology, including the establishment of the Digital Free Trade Zone (DFTZ).
The education sector is also going through numerous upgrading in teaching philosophies, such as increased gap bridging and integration among universities and industry players. Programmes such as the CEO@Faculty Programme, 2u2i and efforts to enhance skill levels through Technical and Vocational Education and Training (TVET) are also in progress.
The agricultural sector is also shifting gears. While our comparative advantage in rubber and palm based products remains intact, we are also looking to specialize in higher yield premium agro products such as seaweed, herbs, swift’s nests and our king of fruit, the durian.
It is for this reason that the administration shifted the automotive industry towards gradual liberalisation, through the National Automotive Policy 2014. The automotive sector, despite its size, has always been a prime mover of technology spin offs for the use of other sectors. The massive technology consumption in manufacturing processes assists other industries that consume the same materials and processes, such as plastic, rubber, metal and composites as they spin off the technologies to elevate all sectors.
It is also for this reason that the automotive industry is witnessing a transformation from a domestically driven market to a globally thinking market leader. We will continue to work with both local and global experts and organisations, and allow high value to penetrate our borders. After all, those borders are slowly diminishing anyway.
It is better to be the worst of the best, rather than the best of the worst.
The writer is the chief executive officer of Malaysia Automotive Institute.

Thursday, 28 September 2017

FREEDOM AND NATIONALISM - Malaysia on track towards well-grounded progress

If we were to analogize Malaysia's economic growth as a business entity, it has been a very successful venture. Since our independence, our natural resources and fertile soil gave us the seeds to progress.
While the high exports of resources such as rubber, tin, palm and crude oil made us global players for these commodities, we soon realised that high dependence on raw materials exports subjected us to the high risk of market fluctuation.
The total collapse of the global tin industry in the mid 1980s was an eye opener - and in order to keep business afloat we adapted quickly to manufacturing.
Fast forward to the turn of the century, we are at the next stage of progress - the all-important growth stage and advancing our preparation towards a fully liberalised global market.
For most countries on their way to emerge as a global economic player, the key is to move from an inward-looking economy and to become a player that can compete in new and bigger markets.
To grow further, we need to look at the fundamentals we have developed thus far. Just like any expanding business, we cannot rest solely on the leadership. It requires a nationwide belief and confidence that we can expand beyond our current capacities.
However, our progressive economic growth, as demonstrated by numerous international indicators, is not spared from speculation that breeds economic anxiety.
The examples of such growth are aplenty. The ASEAN Development Bank's (ADB) recent report placed Malaysia among the best growing economies in Asia.
We are now ranked among the top 25 most competitive nations in the world. PWC forecasts Malaysia to be the world's 24th biggest economic powerhouse by 2050.
Just like any growing economy, we have and will continue to have occasional setbacks. The more important question is: would we be able to address those setbacks, or will we take the easy way out?
When the price of crude oil fell in 2015, the implementation of Goods and Services Tax and rationalisation of subsidies by the government allowed us to sustain our momentum.
During that period of uncertainty, the natural consequences, which included cost of living and financial constraints for businesses did not deter our economy, rather the Malaysian economy strengthened further, despite speculation, rumours and negative vibes being played.
The next step is clear - to be part of the global economy, we must have an open market mind set, and the acumen to work with others.
Business should never be a zero-sum game, it should never be about one entity winning over the other. In order for us to compete, we must seek healthy competition, and we will never access world markets if we are reluctant to open our borders to the world.
Strategically, we should view new partnerships and ventures as opportunities, and not confining ourselves to our comfort zones.
Growth is exciting and challenges are overcome with calculated risk. Spread the belief that we are ready to penetrate the global markets.
"A successful man is one who can lay a firm foundation with the bricks others have thrown at him"
The writer is the chief executive officer of Malaysia Automotive Institute.

Thursday, 21 September 2017

DECISION-MAKING - Pre-conceived bias a deterrent to progress

There has been interesting progress in terms of Malaysia's development of late, particularly on the global front.
From reports of trade surplus to strengthening ties with the world's superpowers, we have been making headlines.
This momentum is not only a result of our progressive economic policies and political stability, but also due to the continuous support and participation of the lowest common denominators in our economy.
The government and the people transitioned into higher value economic activities through forward thinking strategies that allowed us to quickly adapt to the dynamics of global scenarios and trends.
This progressive approach, including the government and economic transformation programmes had earned us the recognition of respected global organisations such as the World Economic Forum and The Economist.
Who would have thought that a developing nation now ranked among the best in the world on several fronts.
We currently have one of the best healthcare systems in the world, and are recognised as one of the best places to invest and to start a business. We are ranked among the top 10 faster-growing economies in the world.
These achievements did not come through mere luck, as they are a testament to our strength as a nation.
The current administration has prepared us better for the liberalised economy. Of course, it is not always a smooth ride, as beautiful destinations are often discovered at the end of the roughest of roads.
Traditional borders and business dealings are rapidly fading away, giving way to a new digital ecosystem that transcend boundaries.
While this lowers barriers to entry for small businesses, it also forces liberalisation - the creative and innovative survive, and those that refuse to budge from protectionist mentalities become irrelevant.
Therefore, the open frontiers of global cyberspace necessitate an open mind to new ideas and bold, strategic approaches. The rapid change mentioned above also allows for emerging possibilities that were deemed impossible before.
This is why pre-conceived bias is a dangerous thing. It becomes a lot more dangerous when sources of information are unfiltered, making it easy to develop pre-conceived bias that tends to overpower credible reporting.
Recently, we have seen these bold approaches in the government's position on the socio-economic front.
Our wealth is now more diversified to include both foreign and domestic investment. We encourage international ventures through startegic alliances with global players, and we are taking a leading role to address humanitarian issues and security concerns in the region.
Nevertheless, these endeavours have not been spared from condemnation. While constructive criticism is most welcome, we must be careful of polemics that may cause the retardaation of progress in society, and leave our nation vulnerable to external threats.
To maintain and elevate our progress, Malaysians must be open minded and unbiases. We must look at the merits of any issue on a case by case basis, based on well-researched facts and sound rationale. There is always two sides of the story, there is always a bigger picture to consider.
For me, discussion and dialogue are an important components of quality decision-making. There are many platforms to do so, such as the Transformasi Nasional 2050 (TN50) dialogues, and the call for ideas for the annual budget.
It is therefore important that pre-conceived bias is removed, for meaningful dialogue to take place. Let the arguments be understood, analysed and avoid polarised positions.
Not all of us have the luxury to make decisions. To move forward, a decision still has to be made. There will be many opinions, and naturally it is imposible to satisfy everyone. However, decisions that have been made should be supported, despite our disagreements.
To do otherwise would simply be counter-productive.
Leadership has never been about absolute popularity, but making difficult decisions even though they may not be popular.
The writer is the chief executive officer of Malaysia Automotive Institute.

Thursday, 14 September 2017

FREEDOM AND NATIONALISM - Great nations are built on economy and humanity

This weekend, we close the year’s season in the celebration of freedom and nationalism. For me, it also serves as a reminder of how far we, as a nation, have progressed.
Although progress is often judged through economic indicators, capitalist ideals of personal wealth posession can in no way be a yardstick for true progress. It is difficult to fathom the social acceptance of being only rich by bank account, and bankrupt morally and principally.
From the economic standpoint, the last few years have been challenging. We felt the pinch of dropping oil prices, unfavourable currency exchange rates and rising costs of living.
We had to make some tough decisions that included tax restructuring and budget re-prioritisation for the sake of sustainability.
Apparently, social media and economic uncertainty is not a good mix. Tough times can bring the harshest of emotions and muddle meaningful discussions.
Positive indicators are often at high risk of being specialist knowledge, such as being ranked among the top 25 countries in the World Economic Forum’s Global Competitiveness Report, or The Economist’s ranking Malaysia as the 8th fastest growing economy for last year.
We have also been ranked within the top five countries in terms of healthcare, and best countries to invest or start a business in.
Economically, we have performed well on many accounts despite difficulties we have had to face. As humble as Malaysians are known to be, we should be proud of our resilience.
This column has always advocated fair judgement, and defining progress must be done holistically in order to be fair.
As mentioned above, great civilisations have the ability to advance forward while mitigating the risk of bankruptcy of our moral values, compassion and passion. Societies that have human compassion tend to have better wealth distribution, exemplified by a significant middle class.
Since independence and the formation of our nation, this has always been our guiding principle. We have developed this ecosystem of opportunity through the leveraging of our multi-cultural difference, and peacefully overcome disputes.
Our compassion and humane nature have resulted in a low poverty rate, compared with regional counterparts.
When one of the worst floods hit the state of Kelantan in 2015, Malaysia Automotive Institute (MAI), organised a flood relief drive with the automotive industry to alleviate the suffering of our countrymen in the northeast.
To our surprise, the support we received was very overwhelming, we received more than we ourselves could carry.
Recently, we have taken the next step towards regional leadership in humanitarian efforts.
I applaud the administration’s courage in leading humanitarian efforts in addressing the suffering of the Rohingya.
Along with Indonesia, we have agreed to provide temporary shelter to the migrants, to allow the international community to address such a complex humanitarian issue.
This Malaysia Day, let us realign our thoughts to what it means to be a great nation. We are not perfect, and we may have our own issues to work on.
However, as long as we are smart about our problems, and we have that human touch, I believe that would be the formula to not just economic greatness, but a sustainable economic resilience.
Let us be known not only as the nation of great wealth, but also great compassion.
The writer is the chief executive officer of Malaysia Automotive Institute.