20-21 February 2018, Mexico City: Workshop on building business linkages that books SME productivity. http://www.oecd.org/cfe/smes/workshop-on-building-business-linkages-that-boost-SME-productivity.htm

1. 1
Adoption of Digital Technologies for SMEs:
React, Reflect And Connect!
By
Hafsah Hashim
CEO, SME Corp Malaysia

2. E-Commerce Online
Retail Business
Big Data
Analytics
Internet of
Things (IoT)
Robotics
3D Printing
Industry 4.0
The disruptive era of MEGAtrends :
SMEs need to React, Reflect and Connect!
4

3. 4 Megatrends : Far-reaching impact on SMEs..
SNAP
SHOT
DIGITAL
FUTURE
& IR 4.0
M1
RISING OF
ENTREPRENEURSHIP
COMMUNITY
LIVING
GLOBALISATION
High growth
Inclusiveness
3
M2
M3 M4

4. DIGITAL FUTURE & IR4.0 : SMEs to seize the
opportunities, gain significantly
Digital transformation changing
business & delivery models
Increasing mobile device
adoption, a “mobile first” world
Cloud, mobile and
social technologies
• Big data
• Cloud computing
• Social media
• Virtual stores
• Subscription-based
models
• 3D printing
• Robots
• IoT
• AI
• On-line platforms
• Digital village
M1
4

5. Globalisation: Faster growth and favourable
demographics in Asia & rapid-growth markets
Trading between
emerging markets
increasing
Global balance of power to
BRIC & MINT nations • Asian middle class-
significant spending power
• “New knowledge world
order” emerging, with Asia
as a hub Increased
workers
mobility and
technological
advances
ASEAN
• Market size of 625 million
people (60% - youth)
• Internationalisation
through regional
cooperation
5
M2

6. Community living: Empower communities with the
power of ICT and broadband enabling creation
Globally there will be more devices connected to the
internet than people (50 billion devices vs 7.5 billion
people by 2020)
 More microenterprises in developing world
(77% in Malaysia)
 Lack of automation
 More mobile phones; cheaper and more
powerful each day.
 Low cost
 Easy access
 Peer pressure
1
CURRENT
CHARACTERISTICS
2 3 PUSH FACTORS FOR
ICT ADOPTION
• build up business capabilities
• connect with digital ecosystem partners
• promote exports
• to be globally competitive companies
Go Global Malaysia
#MYGoGlobal
Going forward, microenterprises in rural
area need to be part of digital economy
6
M3

7. Rising of Entrepreneurship: The drivers of
entrepreneurial activity moving from necessity to opportunity
Start-ups with
innovative ideas, making
a high-impact
The face of entrepreneurship is
increasingly young
The face of
entrepreneurship is
increasingly female
7
M4

8. 8
How digital technologies support
Business Linkages

9. Entrepreneurial Content
• Financial Assistance
(Business Accelerator
Program)
• Advisory and Coaching
(SME Expert AP)
Branding &
Packaging
E – Commerce /
Market Intelligent
/ Analytics
Certifications &
Standard
Business Services
/ e- Payment
Financing /
Working Capital
Entrepreneurship
& Higher Value
Added Activities
I - Farm
Digital Platforms
• Online Business Platform
(eUsahawan)
• Digital Training
I4.0 Technologies
• Data Analytics
• Cloud
Computing
• Apps
• Supply chain
system
Rural Economics
Development Programmes
• Rural Business Challenge
• Sustainable Village (Desa
Lestari)
Infrastructure
• Internet capabilities
• Network Accessibility
• Narrow Band IoT
‘SMART’
Farmers
Smart
Mushroom
Farming
I - Comm
EXISTING INITIATIVES
LINKAGE 1: FUTURE DIGITAL VILLAGE
Connecting rural businesses through digitalisation
9

10. 10
• Seed, Transit, Harvesting
Fertigation Systems
• Wireless, Structure, Interface, Control
Systems.
Big Data
• Seed, Transit, Harvesting
HR Efficiency
• Water, Soil, Fertilizer
Sensor Technology
• Capture, Data Converter, Process, Control
Internet of Things (IoT)
SMART FARMERS : Smart Precision FarmingBiz Model -
Technology Convergence by IC Microsystems
The business model can be
expanded by creating more
participants in this segment

11. SMART MUSHROOM: Precision Farming helps to
increase productivity and revenue of SMEs
Smart
Mushroom
Farming
• Control panels
• Temperature, CO2 &
humidity monitoring
sensors
• Production data
Internet
Cloud
• Stock monitoring
• Quality monitoring
• Product tracking
• Order confirmations
• Real time information
E-
Commerce /
e-Payment
• Online markets
• Efficient transactions
• Promote brands cross
border
Smart Control Panel
Wired / wireless systems
Remote monitoring
Mobile
Apps
Seamless tracking and
management
Closing the
gaps
between
customers
and product
11

12. Enabling Policies
Strategic
partnership
with global
leaders: Investment
o Warehouse
o Logistics
o Customs
o Training
o Regional HQ
o FSI Services
DFTZ E-Services
Platform
o E-Services platform
o Interface with services from
agencies & private sector
Satellite ServicesE-fulfillment hub
Physical Virtual
KL Internet
City
LINKAGE 2: DIGITAL FREE TRADE ZONE
Strengthening market access via E-Commerce
To capitalize on the confluence & exponential growth of the Internet
Economy & Cross Border eCommerce activities
1. Increase SME eCommerce exports
2. Make Malaysia a key sourcing & fulfillment hub for global marketplaces
3. Nurture an ecosystem to drive innovation in eCommerce and other Internet Economy-related innovations
4. Drive Investments into Malaysia
 Double the growth rate of
Malaysian SMEs
 Increase overall goods
export by US$25 billion
 Create 60,000 jobs
Target of DFTZ by 2025
18
Expected OUTCOME:

13. Register User via
eCommerce Portal
Trained via eCommerce
portal1 2
• eCommerce portal to guide
SMEs in eCommerce adoption
journey.
• Develop and implement a
common traditional
eCommerce training
programme. Partnership with
the following partners:
End-to-end approach for
e-Commerce adoption among Malaysian SMEs..
eCommercePlus Strategic Approach –
Collaboration with Agencies, eCommerce Players & Associations
• SMEs trained via eCommerce
Wizard & eLearning Module
• Portal gamification to enable
SMEs earn ‘graduation’ points
to redeem partners’ offers (eg:
Amazon Subscriptions,
EasyParcel Credits)
Trained via neutral training
provider/ workshops3
16

14. 14
LINKAGE 3: CATALYST PROGRAMME
Integration into targeted supply chain for High Growth SMEs
LED/Solid State Lighting
Phases of the Programme
Aerospace Manufacturing
Biotech
Medical Devices

15. 15
LED-SSL companies shown significant growth in sales
0
65
80
110
115
65.6
70.1
88.1
116.9
125.2
0
20
40
60
80
100
120
140
2012 2013 2014 2015 2016
Millions(RM)
Year
Target Sales Actual Sales
32 %
27 %
7%
7 %
Creation of Homegrown LED-SSL Champion

16. 16
BioNext companies shown steady growth into International Market
 Successfully listed
products on
Amazon.com.
 Successfully
launched Antioxidant
Skin Care, Astatude.
 Successfully
penetrated China
market.
BioNext Initiative: Transforming high growth biotechnology
companies into World Class Player – Linking them to
Multinational players
Furley Bioextract Sdn. Bhd.
Fuciphagus Agritech Sdn. Bhd.
Algaetech International Sdn. Bhd.
Penetration into
more than 20 new
countries

17. 17
Malaysian Aerospace SMEs are now part of Global Supply Chain

18. LINKAGE 4: O2O Commerce Model
On-line to Off-line presence of products & services
Create
awareness
of
products
and
services
via online
Entice
customer
to Visit a
physical
store to
make
purchase
2
Brendan Witcher,
Principal analyst at
Forrester
“Many customers
want to have
experience that
allows them to hold
and touch, try on, the
products. Walk into a
store and walk out
with merchandise”

19. 19
The world’s fastest growing companies are all O2O commerce layers
…IT IS THE NEXT BIG THING!

20. 20
“We should no longer be talking about Digital Marketing,
… but Marketing in a digital world”.
Keith Weed Unilever 2015

21. SME Corp. Malaysia
SME Corp. Malaysia
www.smecorp.gov.my
+6 03 27750600
info@smecorp.gov.my
21