The Inside Story of IT in Malaysia

The Inside Story of IT in Malaysia

As noted by The Malaysia Digital Economy Corporation (MDEC), there has been for too long a mindset that IT is merely “an add-on component that introduces enhancements meant for improving processes” rather than innovation that can develop Malaysia as a digital powerhouse. It is a mindset that, according to MDEC, must be revised. Fortunately, it seems that this change is at hand.

Observers have said that “an important component of a disruptive technology is that it must first be widely adopted before society adapts to it”, and there are encouraging signs in this respect, with the Malaysian government expanding the regulatory sandbox to allow companies to test innovative ideas and business models. In addition, Malaysians are showing a strong aptitude for the digital world, with Facebook users having 60 per cent more friends than the global average, and Uber has registered 160,000 drivers.

Perhaps the greatest barometer of Malaysia’s comfort with technology is the rise of the e-commerce sector, which grew to represent 6.1 per cent of GDP in 2016, up from 5.9 per cent the previous year. This rise is expected to continue, as the ‘National E-Commerce Strategic Plan 2016-2020’ initiative aims to almost double the industry’s growth rate to 20.8 per cent by 2020. As a result of this, Malaysia is witnessing an upsurge in both mobile commerce and e-commerce and is adopting an increasing number of cashless forms of payment including blockchain technology, e-wallets and even mobile payment applications, leading to some 17 per cent of Malaysia’s fintech companies being e-wallets and social network giant WeChat entering the already crowded market.

Although Malaysia has traditionally been a slow adopter of new technology, thanks to these recent developments there has been a growth in complexity of coding courses at the nation’s universities and independent institutions that are updated to the latest technologies and versions of the software. In addition, newer businesses are integrating machine learning practices in their business processes for purposes such as fraud detection and marketing automation in order to compete with larger businesses. These advancements are increasing expectations of an exciting boom in technology adoption once these businesses mature over the next five years.

A further result of this keen adoption is that companies with a welcoming approach towards technology are creating a demand for newer technologies such as blockchain, big data and cloud. This is perhaps best illustrated by the ecommerce giant Alibaba’s continued interest in Malaysia, rolling out AI powered products for end customers, creating a number of job opportunities for candidates with a hardcore programming background (R, Python, C++) and an understanding of complex data structures and algorithms. This year has also seen the creation of a new country office – a “one-stop solution centre” for local businesses designed to support Malaysia’s technology innovation through cloud computing services – following soon after the launch of its first electronic world trade platform hub outside of Mainland China, creating the infrastructure to support global trade with services encompassing ecommerce, logistics, cloud computing, mobile payment and talent training.

While there is an obvious desire from companies to implement these new technologies, the key stakeholders of many organisations demonstrate a lack of understanding of the technology. This is leading to companies seeking out talent who can come in and hit the ground running without requiring training and upskilling, especially in the area of UX/UI professionals and front-end developers with a strong instinct for design, as attractive interfaces remain a differentiating factor in user acquisition. Not only that, but candidates are expected to leverage their experience and fresh outlook to shake up IT departments and instruct department heads on how the technologies can be implemented to improve processes and save costs.

As a result, candidates who are savvy enough to understand the opportunities inherent in their unique talents are augmenting their skillsets by way of online courses, conferences and networking groups to make themselves even more attractive.

Unfortunately, with Malaysia being behind other countries/regions in the IT pipeline development course, these candidates are relatively scarce, meaning that organisations are turning to alternative sources of talent acquisition. Large MNCs, particularly in the media and telco industries, continue to hire on mass from overseas markets, primarily India, for their shared service hubs.

Alternatively, when it comes to new technologies, some MNCs are using companies to incubate new projects, bringing in individuals from other global departments to manage these projects until they are ready to let them go. Companies are also showing a desire to recruit experienced individuals from Hong Kong or India as department heads before hiring local candidates that have talent though lack experience. This can be especially fruitful as there has been a growth in universities and other independent institutions offering courses in complex coding and the latest technologies and versions of software. However, due to stringent restrictions on overseas recruitment, this continues to prove difficult.

Another factor causing companies difficulties in the acquisition of the required talent –particularly in senior level roles – is that candidates are required to both monitor and lead teams. There is a tendency in Malaysia for candidates to either focus on the technical side of the industry or the people management aspect, and role diversification is rare.

But with key stakeholders desiring the latest technology yet being unaware of how and why it should be implemented, it is imperative that candidates possess the business acumen to communicate the advantages from a commercial viewpoint. At the same time, they must be able to communicate with their technical teams the business requirements and what can be done to achieve them, meaning that candidates who are skilled in ‘business to technology’ translation are very much in demand.

Although the candidate pool continues to be shallow, these are the individuals who will lead Malaysia into the technological future. Right now, there are now encouraging signs that for many businesses IT is no longer simply for the enhancement of processes, but rather recognised as an integral tool for revolutionising the way they do business. As such they should no longer shy away from the gale of creative destruction, and instead step into it, be carried along with it and, with the right candidates, profit from it.

An overview of what other trends have been observed in Malaysia’s IT sector can be viewed below:

• Malaysia remains an attractive proposition for companies looking to establish local hubs.
• The traditional programming languages and ERP systems such as .NET, PHP and SAP remain very much in the market and will continue to do so for as long as the rest of the industry resists the adoption of new technology.
• Data science candidates need not only have research-level experience but also familiarisation with production-level ML. Solid understanding of programming languages such as R, Python and MALLET is a must.
• They also need to have hands-on experience with tools such as Tensorflow, Dialogflow and have worked on projects with large data sets. Having a profile showcasing technical skills on Kaggle and Github has become mandatory.
• Increased usage of cloud technology especially private cloud within the industry allows reliance on open source technologies within larger organizations as well.

If you would like to discuss this report in more depth or you wish to discuss your job search or recruitment needs, please contact James Craggs at