SMEs need digital technology for survival

SMEs should not rely purely on manpower, foreign workers or low-skill level operations, says association president


THE pandemic has pushed the small and medium enterprises (SMEs) to adopt digital technology for their survival.

SME Association of Malaysia president Datuk Michael Kang Hua Keong said since the Movement Control Order (MCO) was imposed in March, a lot of SMEs have faced zero income due to the unprecedented situation.

“Many struggle to survive and stay afloat, and I honestly feel like it would be difficult for a lot of them just to see another month of this.

“Everyone knows that SMEs are facing a huge challenge since the MCO, but this is the time to adopt technology and they should not rely (purely) on manpower, foreign workers or low-skill level operations,” he said at the SME Day Live opening remark last Friday, in conjunction with the launch of eServices Hub.

The hub is a tech-solutions platform which integrates works between the association and Huawei Technologies (M) Sdn Bhd to enable businesses in the country to embrace digitalisation for a more efficient and economical way to run businesses via digital operations.

The platform aims at facilitating the sharing of practical technology knowledge, joint development of needs-based digital solutions for local SMEs, creating new businesses and job opportunities, and creating a market which would allow tech-related SMEs to grow.

Kang said with the SME Day programmes, hopefully, more SMEs in Malaysia can partake in moving to the next step from surviving to thriving.

“Through the Huawei-powered eServices Hub, we will be able to share practical technological knowledge which SMEs in Malaysia jointly developed for local businesses.

“Not only that, the hub will also be fully integrated with the association’s website,” he said.

Huawei Malaysia cloud business unit head Tan Kuan Thye said over 50% of the SME market can be unlocked if digitalisation barriers is overcome.

“About 48% of SMEs said technology is a barrier in itself, and by technology, we are speaking about the less complex technology — just the ones that will help SMEs conduct their daily operations.

“With technology as one barrier, they are also facing the lack of exposure to technology and as such, they don’t understand how even simple technology can help them with their businesses,” he said.

He added that the new tech infrastructure will be the digital foundation in the coming years to help the SMEs develop and recover from the damage incurred by the pandemic and its preventive measures.

“There are four elements which will unlock SMEs’ potential and how they can move forward, including the digital foundation, which is to develop the right Internet connection and cloud infrastructure.

“In Malaysia, we are teaming up with Telekom Malaysia Bhd in order to enable a local artificial intelligent (AI) platform to help SMEs transform their operations,” he said.

He added that aside from AI and cloud infrastructure, another area in which SMEs would need help with is having an open mindset and facilitation, both of which aren’t related to technology.

“They need to have the right mindset and be open in order to accept new things and solutions moving forward, so that they can see greater opportunities,” he said. He said currently Huawei Malaysia is in the works of helping SMEs expedite their journey and transformation.

“With that in line, Huawei Malaysia and different stakeholders including the government, SME Corp Malaysia and Malaysian Digital Economy Corp (MDEC), as well as NGOs in the industry market are trying to lend a hand with different kinds of trainings and workshops, as well as on how to create a market access, especially for the tech-related SMEs.

“This is so that they know the market, which is the SMEs themselves, in order to sell, work and provide the relevant digital solutions,” he said.

It was reported that the government assistance worth RM24 billion benefitted over 1.4 million SMEs, which came in the form of direct funding or grants.

The assistance and benefits included the SME soft loans funds under Bank Negara Malaysia worth RM11.13 billion, the wage subsidy programme worth RM9.89 billion and Prihatin special grant 1.0 and 2.0 worth RM2.55 billion.

Similarly, other initiatives were also rolled out by MDEC through Shop Malaysia Online, and the micro and SME e-commerce campaign, both of which have generated over RM1.2 billion in sales from an allocation of RM140 million.

Under Budget 2021, more facilities in the form of soft loans and grants would also be rolled out for SMEs.