BUSINESS leaders in Malaysia are focusing on leveraging technology and digital to recover and thrive in the new normal, according to the Ernst & Young PLT (EY).
EY’s Covid-19 business impact survey, conducted between April 27 and May 19, found that businesses have accelerated the adoption of technology in response to Covid-19 and the restrictions that followed.
Thirty-seven per cent of SMEs and 32% of the large and listed companies have taken steps to expand or upgrade their technology capabilities based on the online poll that covered nearly 700 large and listed firms as well as SMEs.
“Close to 30% of businesses have also invested in ‘Work from Home’ hardware and software to ensure connectivity with their employees and improve employee productivity,” said EY.
EY Malaysia managing partner Datuk Abdul Rauf Rashid said Covid-19 has emerged as a game-changer for digital transformation.
“Where previous initiatives and programmes to go digital have met with lukewarm responses, particularly from the SMEs, Covid-19 has spurred companies to accelerate its digital transformation,” he said.
According to EY, the movement control order (MCO) has revealed that businesses in Malaysia are insufficiently equipped to transition to a more digital-enabled work environment.
“During the MCO, most companies (83% large and listed companies; 84% SMEs) experienced difficulties with online connectivity and communicating with their suppliers and customers, in addition to issues with infrastructure,” it said.
EY said companies need to step up their digital transformation and adopt technology-enabled processes and systems in preparation for a more digital-enabled environment in the new normal.
EY Advisory Services Sdn Bhd’s Malaysia financial services consulting leader, Shankar Kanabiran, said to support this demand and enable digital transformation, there needs to be significant enhancements to the businesses’ and nation’s digital and communications infrastructure especially on online connectivity and broadband speed.
He said about 40% of respondents have identified better and less costly online connectivity as areas for intervention.
EY said that almost half of the large and listed respondents and 40% of the SME respondents say that they would need direct government aid in the immediate future to restore financial strength and liquidity in preparation for economic recovery.
“Financial aid, technology grants, incentives, tax reliefs, easing of tax compliance, lower interest rates and extending moratoriums on principal repayments are among some measures sought by businesses. There is also a call for greater flexibility on the part of banks towards businesses impacted by the crisis,” Kanabiran said. – June 2, 2020, Bernama
