The Malaysian Reserve

Stuck in the middle of digital transformation

Features Picture for Transport Services like GRAB Car, Bus, Teksi and Others at KL Sentral Kuala Lumpur

ON RETURNING home from an overseas trip, I had the pleasure of being driven by Vijay, a cabbie whom I have known many a year.

Before too long, the conversation turned to the impact that Grab and Uber Technologies Inc has had on him, as well as on most of the taxi drivers within our fair city.

The five takeaways I gleaned from our journey were:

1. On coming to the table several years back, Grab disrupted the radio cab business by bypassing the need to have a radio controller to monitor and dispatch pick-up to cabbies who were in the vicinity.

Not only was there an opportunity for the cab company to make savings on the rental of the radio band they were using, but there was the opportunity to connect the driver directly to the passengers themselves and so reliving the cab company of yet another cost — namely, the cost of the radio controller and the associated hardware that came with such a service.

2. The process of providing taxi services went a notch more digital when it started to connect the passenger to an address and this meant the linkage of the passenger to a digital map and to some sort of digital wayfinder.

The next evolution of the application led to the direct connection of the passenger to the cabbie by way of a phone connection. With this done, there was no longer the need for the intermediary cab company.

Grab was now able to offer its services directly to the passenger as a strong and viable alternative to the traditional cab companies in the city.

3. To a large extent, and even Vijay agrees to this hypothesis, the city cab companies were largely complacent and totally unresponsive to the increasing demands and changing needs of the passengers.

At one time, it was common to hear of cabbies consciously not wanting to take on passengers or at worst, not using the meter when charging their fares. Inevitably, these very actions and the ineptness of the relevant associations to regulate and proactively address the same, created a fundamental need in the marketplace.

All that Grab did was to effectively address that need in a simple yet practical fashion using what was already commonly available…the power of the Internet, smart devices and the online payment platform.

And voila, the birth of a digital cabbie application.

4. As an authorised and duly certified taxi driver, Vijay is obliged to follow the tariff rates that have been provided for by the local authorities.

He believes that these tariffs rates, while being well-intentioned, are higher than those being charged by Grab. And therein lies yet another consideration, that of price competition.

5. Admittedly, Grab and others of its kind have provided tremendous opportunities to many in the workforce to supplement their monthly earnings.

With this, cabbies like Vijay are now being pressured by an alternative, somewhat more “professional”, gig-based taxi driver workforce which was almost unheard of only three years ago.

What Does This Mean for Us?
There is much talk and tremendous pontificating about the proverbial “Seven Mega Trends”, the “Five Must Win Battles”, the “Three Themes” that will drive the nation forward, and the impact of artificial intelligence on our workforce, including intensive tech training and the like.

What concerns me is how does someone like Vijay and others like him — whether they be cabbies, book-keepers, those working in publishing houses or even bank tellers, for that matter — earn a living in the future that is fast unfolding before us.

The numerous publications from noted firms, as well as those on social media platforms like LinkedIn, are abuzz on an almost daily basis with terms such as digital transformation, blockchain crafting and the creation of high-income jobs.

But in all honesty, what does that really mean to the majority of the common folks like Vijay, the cabbie, and to a proverbial Puan Aishah, the mobile vegetable seller, and Mr Appu, the iconic roti man, who go on their daily rounds to various housing estates selling fresh fruits, vegetables and loaves of bread.

Not everyone is able to play in the blockchain space, nor do they have the mental aptitude and the access to funds to enhance themselves through skill upliftment.

Almost 55 minutes into our drive, we had arrived safely at my residence and Vijay’s parting words were: “Sir, the life as we know it has changed, and for our families’ sake, we must make changes to keep ourselves alive.

But I just don’t know what to do.” And that, in my mind, is the reality for all of us who are being impacted by this ever rising tide called the digital economy.

  • Taranjeet Singh, CEO of consulting firm Quantum Steppe Advisory, has just returned to Malaysia after living and working in Central Asia for the past several years.