KUALA LUMPUR, Sept 30 — Malaysia has the potential to become the top global business services (GBS) destination worldwide if more digital talent is 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 (about a body of 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 skill set.
“Also, it has to comprise the right management and leadership skills because you would be managing a large team. These are the ingredients needed to become number one in the GSLI,” Teoh told Bernama on the sidelines of the Asia-organised Agos GBS Summit 2023 here on September 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 stagnant 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 finds it difficult to compete with countries with bigger populations.
Teoh, who is also Agos Asia chief executive officer, explained a multinational would 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.
In the 12th Malaysia Plan (12MP) 2021-2025, global services (GS), which comprise principal hubs, GBS and headquarters operations, is the main contributor of FDI in the services sector.
The 12MP said total investments in the GS sector are estimated to reach RM89 billion 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.
Meanwhile, InvestKL chief executive officer Datuk Muhammad Azmi Zulkifli said the agency, which is under the Investment, Trade and Industry Ministry, has seen 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 the Greater Kuala Lumpur (Greater KL) are well positioned to support long-term and sustainable growth.
“There are over 130 multinational companies in InvestKL’s portfolio and this is an ongoing testament that our business fundamentals are on a par with global standards and able to meet the requirements of (multinationals) serving global markets,” said Azmi.
He said the Greater KL area serves as a burgeoning hub for GBS, bolstered by Malaysia’s ease of doing business, cost competitiveness, diverse multilingual talent and an ecosystem driven by strategic collaborations.