Malaysia on track to become top GBS destination by focusing on talent regeneration -- expert
KUALA LUMPUR, Sept 30 (Bernama) -- Malaysia has the potential to become the top global business services (GBS) destination worldwide if more digital talents were available for multinationals, said GBS and finance expert Joon Teoh.
She said Malaysia needs to have a razor-sharp focus on its talent regeneration going forward to book the first spot in the coming indexes despite being ranked third in the Global Services Location Index (GSLI) for almost 20 years.
“There are two things (on talent). Firstly, it has to be available to meet the demand, which means we are talking about quantity. Secondly, it has to be the right skillset, the right skillset means it has to be equipped with digital skills.
“Also, it has to have the right management and leadership skills because you are managing a large team. These are the ingredients that are needed in order to become number one in the GSLI (ranking),” Teoh told Bernama at the sidelines of the AGOS Asia-organised AGOS GBS Summit 2023, here on Sept 21.
According to the 2023 GSLI report in July by global management consultancy, Kearney, India, China and Malaysia continue to lead this year’s index.
The firm mostly issues its GSLI reports on a biennial basis with Malaysia being trapped at third place since the first report was launched in 2004.
The latest index tracks the contours of the global landscape across 78 countries with four major categories: financial attractiveness, people skills and availability, business environment and digital resonance.
On people skills and availability, which focus on the quantity and quality of the talent pool, Malaysia scored 1.29 points, whereas its main rivals India and China got 2.09 and 2.24 points, respectively.
Teoh said in terms of quantity, based on Malaysia's organic population itself, the country found it difficult to compete with countries with bigger populations.
“We look into the quality part and that is where our people need to quickly transition from just execution work to managing the digital technology,” she said.
Teoh, who is also AGOS Asia chief executive officer, explained that a multinational will set up a GBS centre in countries like Malaysia to provide shared services such as finance, human resource, procurement, supply chain and information technology to their subsidiaries around the world by using digital technology.
“If multinationals can find talent, they will come here. And when they come, we are not only attracting foreign direct investment (FDI), they may also want to hire 500 people, 1,000 people.
“Right now (in Malaysia), the digital economy has about 210,000 people and half of them are from the GBS (sector). This is our position of strength and we should be doing much more,” she said.
According to the 12th Malaysia Plan (12MP) 2021-2015, global services (GS), which comprise principal hubs, GBS and headquarters operations, is the main contributor of FDI in the services sector.
According to the 12MP, total investments in the GS sector are estimated to reach RM89 billion (US$1=RM4.699) by 2025, and approved investments in GS by multinational companies stood at RM46.1 billion, constituting 51.7 per cent of total FDI in the services sector from 2016 to 2020.
Teoh said one of the objectives of the AGOS Summit, an annual event that made its debut in 2018, is for talent regeneration and talent building.
The summit enables private sector organisations like AGOS Asia to work with government agencies and educational institutions to create a platform and opportunity for local talents to learn and grow.
“We are in partnership with government bodies, namely the Malaysia Digital Economy Corporation and InvestKL, to disseminate information about this summit and encourage people to join. They also provide eminent speakers and insights into the government’s direction.
“With more than 200 participants, it is a platform to learn, especially on new technologies, from each other and see what they (GBS practitioners) are doing, so that they can be inspired,” she said.
AGOS Asia is a Malaysian-based consulting firm with an international reach specialising in helping multinational corporations (MNCs) set up and expand their GBS footprint through the pillars of process design, technology and people upskilling.
It has also been recognised as the top consulting firm in Asia for “Outsourcing and Shared Services” by Consultancy.asia, an online platform for the advisory and consulting industry.
Meanwhile, InvestKL chief executive officer Muhammad Azmi Zulkifli said the agency, which is under the Ministry of Investment, Trade and Industry, is seeing an upward trend of leading global companies establishing their GBS centres here and contributing significantly to the nation’s economic development.
“Spurred by the government’s supportive initiatives to promote cutting-edge technologies and innovation, Malaysia and Greater Kuala Lumpur (Greater KL) are well positioned to support long-term and sustainable growth.
“There are over 130 multinational companies under InvestKL’s portfolio and this is an ongoing testament that our business fundamentals are on par with global standards and able to meet the requirements of MNCs serving global markets,” said Muhammad Azmi.
He added that Greater KL serves as a burgeoning hub for GBS bolstered by Malaysia’s ease of doing business, cost competitiveness, diverse multilingual talent and an ecosystem that is driven by strategic collaborations.