“Give a man a fish and you feed him for a day; teach a man to fish and you feed him for a lifetime.”
Small and medium enterprises (SMEs), more than any other business segment, are in for a big digital transformation — whether they like it or not — and therefore an essential participant in “Malaysia 5.0”.
Malaysia 5.0 outlines a problem-solving approach to society’s challenges and problems through the deployment and implementation of the Fourth Industrial Revolution (4IR) technologies which integrates both physical and digital environments.
It stems from the term “Society 5.0” which describes the next stage of the evolution of societal communities, following the hunting society (Society 1.0), agricultural society (Society 2.0), industrial society (Society 3.0), and information society (Society 4.0).
This system was conceived by Yuko Harayama, who advised the Japanese cabinet on matters of innovation, with the objective of empowering people with 4IR technologies, especially those left sidelined by society and the economy.
I would like this philosophy to underpin the Malaysia Digital Economy Corporation's (MDEC) strategy so that we can deliver such solutions to Malaysians across all economic classes, especially SMEs hit by the Covid-19 crisis facing the challenging economic environment ahead.
Digital transformation from e-commerce solutions, training and education, and integration onto common platforms, will improve lifestyles and enable independence for those that implement them proactively.
At the same time, the big data revolution will empower SMEs to fully flex its considerable influence in the economy. Today they face multiple challenges such as lack of business connections, limited awareness of technology, lack of access to funding, education and training, and poor Internet presence in a world going full-on digital.
According to the World Bank, the majority of the global economy consists of small businesses and startups. Of all these businesses, it turns out only a third of them actually have employees. Mostly they are self-employed individuals operating in the informal — or grey — economy.
Malaysia 5.0, when properly implemented, can directly address their inclusion, access, performance and growth through 4IR tools such as fintech, blockchain and AI. Digitalisation offers new opportunities for SMEs to participate in the global economy, innovate and grow.
MDEC will play its part in this ecosystem by offering a “sandbox” for SMEs to experiment with new technologies and stress test them before implementation so that the risk of failure is reduced. The result is greater sustainability for those SMEs that innovate.
In this way, SMEs will play a critical role in strengthening productivity, delivering more inclusive growth, and adapting to the major transformations of our time.
Enabling SMEs to innovate can have a considerable economic and social impact, reduce the persistent gap with large corporation, and equalise income distribution — all desirable goals in the digital age, or indeed any age.
The writer, Rais Hussin is Malaysia Digital Economy Corporation (MDEC) chairperson and the president/CEO of Emir Research, an independent think-tank focused on strategic policy recommendations. - Mkini
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