“industry – academia linkage programs (malaysia)”€¦ · “industry – academia linkage...

“INDUSTRY – ACADEMIA

LINKAGE PROGRAMS

(MALAYSIA)”

Mr. Mohd Izham Abdullah

Senior Manager, SMIDEC

APEC SME Innovation Center

Lexington Hotel

Seoul, Korea

Table of Contents

• Overview - SMEs In Malaysia

• SME Innovation

• Policies and Strategies

• Advancement of Technology

• Emerging Technologies

• Capacity Building

• The Way Forward

OVERVIEW

SMEs In Malaysia

“Companies in the manufacturing,

manufacturing related services and

agro-based industries with annual

sales turnover not exceeding RM25

million (USD6.6 mil) OR full time

employees not exceeding 150”

MANUFACTURING, MANUFACTURINGMANUFACTURING, MANUFACTURING

RELATED SERVICES AND RELATED SERVICES AND

AGROAGRO--BASED INDUSTRYBASED INDUSTRY

DEFINITION OF SMEs

SERVICES, PRIMARY AGRICULTURESERVICES, PRIMARY AGRICULTURE

AND INFORMATION ANDAND INFORMATION AND

COMMUNICATION TECHNOLOGY (ICT)COMMUNICATION TECHNOLOGY (ICT)

“Companies in the services, primary

agriculture and Information &

Communication Technology (ICT)

sectors with annual sales turnover not

exceeding RM5 million(USD1.3mill) OR

full time employees not exceeding 50”

DEFINITION OF SMEs DEFINITION OF SMEs ((…… contcont’’d)d)

Detailed definition of SMEs by Size

Sales turnover

between RM1million

(USD263,000) and

RM5 million (USD1.3

mill) OR full time

employees between

20 and 50

Sales turnover

between

RM200,000

(USD52,600) and

less than RM1

million

(USD263,000) OR

full time

employees

between 5 and 19

Sales turnover of

less than RM200,000

(USD52,600) OR full

time employees less

than 5

Services, Primary

Agriculture and

Information &

Communication

Technology (ICT)

Sales turnover

between RM10

million (USD2.6) and

RM25 million

(USD6.6 mill) OR full

time employees

between 51 and 150

Sales turnover

between

RM250,000 (USD

65,800) and less

than RM10 million

(USD2.6 mill) OR

full time

employees

between 5 and 50

Sales turnover of

less than RM250,000

(USD65,800) OR full

time employees less

than 5

Manufacturing,

Manufacturing-

Related Services

and Agro-based

industries

Medium EnterpriseSmall enterpriseMicro-enterpriseCategory

DISTRIBUTION OF SMEs BY SIZE IN THE

MANUFACTURING SECTOR

DISTRIBUTION OF SMEs BY SIZE IN THE

SERVICES SECTOR

Source : Department of Statistics, Census 2000

SME Innovation

• Innovation :

- a new way of doing things

- gives a new spin to old ideas

- technology competitiveness

• Innovation in :

- product

- business

- process

• To support innovation :

- latest technology and equipment

- dedicated team

- patenting

• Mechanism of innovation

- reverse engineering

- creation of mentors

DRIVING SMEs GROWTH THROUGH INNOVATION

CURRENT USAGE OF

TECHNOLOGIES

Status of Malaysian companies:

� Upgrading of machineries & equipments in the last 2

years – 60%

� Improvement of products & processes - 40%

� Dependence on obsolete/old technology – 70%

� Low expenditure of R&D activities – 0.7% of GDP

� Majority MNCs involved in high technology

production & exports

Source : Malaysian Productivity & Investment

Survey (PICS)

Expenditure in R&D by the Private Sector

• Total Expenditure - RM 1,633.1 million

• Current Expenditure - RM 932.7 million

- Labour Cost - RM 248.9 million

- Operating Cost - RM 683.8 million

- Capital Expenditure - RM 700.3 million

Human Resources

• Total Number of Research Personnel

(Headcount) - 5,177

SMEs INVOLVEMENT IN R&D

(Source : Mastic Report, 2004/2005)

INNOVATION READINESS

Key drivers of Innovation (Adaptation & Creation)

Manufacturing(%) Services(%)

• R&D Activities 20 12

• Firm-firm Linkages 37 41

• Industry – University 10 14

• Firm – Research Institutions 21 17

• Firm – Government Agencies 23 15

Source : Malaysian Productivity & Investment

Survey (PICS)

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0,50

1,00

1,50

2,00

2,50

3,00

3,50

4,00

4,50

Cou

ntry

Sw

eden

Fin

land

Japa

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SA

Sw

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Sou

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Ger

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enm

ark

Sin

gapo

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Net

herl

ands

Uni

ted

Kin

gdom

Can

ada

Nor

way

Aus

tral

ia

New

Zea

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Chi

naIr

elan

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Mal

aysi

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haila

ndP

hilli

pine

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1995

2002

% in GDP

TOTAL R& D EXPENDITUREBY SELECTED COUNTRIES

SME PERFORMANCE REPORT

8th Malaysia Plan (2001-2005 ) on Science, Technology & Innovation

Expenditure – RM 3.3 billion

9th Malaysia Plan (2006-2010) on Science, Technology & Innovation

Allocation – RM 5.2 billion

2003 (%) 2004 (%)

• Undertook process improvements 59 60.6

• New product development 44 38.1

• Innovation in technology 22 19.4

• Products patented 3 4.5

TOTAL R&D EXPENDITURE

Total R&D Expenditure, 1992-2002

0

500

1000

1500

2000

2500

3000

Yr 1992 Yr 1994 Yr 1996 Yr 1998 Yr 2000 Yr 2002

Year

RM

mil

lio

n

0.1

0.4

0.5

0.6

0.7

0.2

0.3

0.37

0.34

0.22

0.39

0.49

0.69

% in GDP

POLICIES & STRATEGIES

ENCOURAGING INNOVATION

The Second Science and Technology

Policy (STEP 2) :

� To strengthen S&T;

� To spur greater technological

development;

� To promote a more innovation-led

economic growth.

ENCOURAGING INNOVATION

• S&T

• R&D

• HRD

Adequate Financing

Creativity

&

Innovation

� SMEs direction:

INNOVATION & CREATIVITY

OEM

ODM

OBM

Through innovation and R&D activities

STRENGTHEN LINKAGES

IndustryUniversities/

Researchers

Government/Funding

Technology

Databank

Commercialisation

• In 2005, MITI has set up an Academia Industry Consultative

Council

• A special mechanism and forum to gather industry and

academia

• To jointly provide input and formulate strategies for capacity

building for the nation trade and industry sectors

• Under the Industrial Master Plan 3 (IMP3), SMIDEC will

establish & focus four cornered platforms for academia,

industry, Government and also financers.

Academia Industry Consultative Council

EMERGING

TECHNOLOGIES

• SMEs to acquire new and emerging

technologies;

• Technology transfer from MNCs;

• Undertake feasibility studies for

technology based industry;

• SMEs to integrate ICT into business

processes; and

• MNCs and LSIs move towards

global outsourcing.

EMERGING TECHNOLOGIES

• Economically viable for commercial

adoption;

• Potential to enhance competitiveness;

• Compliance with international

requirement; and

• Capacity to adopt and adapt

technologies.

EMERGING TECHNOLOGIES

• Biotechnology

• Nanotechnology

• Radio Frequency Identification (RFID)

• Wireless Technology

• Micro-Electro-Mechanical System

• Photonics

• Laser Technology

• Fuel Cell Technology

EMERGING TECHNOLOGIES

CHALLENGES

• Minimising costs of acquiring enabling

technology;

• Enhance knowledge and awareness of

technologies;

• Improve knowledge management in the

complex system processes;

• Convergence of technology; and

• Skilled manpower to support and manage

ICT – skills shortage & mismatch.

CHALLENGES

CAPACITY BUILDING

• Stimulate creativity and innovativeness in

business;

• Continued support in both technical

and soft skills; and

• Inculcate entrepreneurship among top

management of SMEs.

QUALITY HUMAN CAPITAL

• Emplacement of university trainees at

business premises or factories;

• Programmes for SMEs in strategic

business planning and new business

models; and

• Provide greater assistance to SMEs to

enhance their technological capabilities.

QUALITY HUMAN CAPITAL

• Improving access to knowledge on ICT

and other enabling technologies; and

• Enhance awareness on Intellectual

Property (IP) to promote R&D and

technological collaboration.

QUALITY HUMAN CAPITAL

• To enhance the skills and capabilities in technical and

managerial levels including information technology and

industrial design.

• 50% grant on training fees

- PUSPATRI - NPC - MINT

- GMI - MFI - NSSDC

- KISMEC - TATI - MISDC

- PESDC - PSDC (Penang) - SIRIM

- SHRDC - PSDC (Pahang) - NIOSH

- SSTC - PPKS - TPM

- IKRAM - IGM - BIP - UTM

SKILLS UPGRADING PROGRAMME

SME EXPERT ADVISORY PANEL

� SEAP programme is implemented through the

emplacement of industrial experts at the

factory sites of SMEs to solve SME’s specific

problems.

� The Programme is to assist SMEs to upgrade

their technological capability, to achieve

efficiency and to increase productivity.

SME EXPERT ADVISORY PANEL

(…contd)

� Expertise available in areas of:

� Productivity and Quality Improvement;

� Production Control;

� Business System Management and Analysis;

� International Standards e.g. HACCP,GMP;

� Production Process Improvement and Maintenance;

� Industrial Engineering;

� Product Development and Design; and

� ICT Adoption.

�Provides advisory services and consultation to

SMEs through:

�Business Clinics

�Virtual SME Information Centre

http : //www.smidec.gov.my

�Toll Free Line : 1-800-18-1801

SME ADVISORY SERVICES

THE WAY FORWARD

• Role of industry associations in promoting

of ICT and enabling technologies;

• To improve co-ordination and collaboration between:

- Government Research Institutes (GRIs);

- Science and Technology Parks (S&T Parks); and

- Institutions of Higher Learning (IHLs).

• Enhanced HRM:

- Conducive employment & environment

- Productivity - linked wage system .

THE WAY FORWARD

CURRENT

Goal

Price Focus

Production Oriented

Production Driven

Cost Oriented

Efficient

Machine Based

Local, National

FUTURE

Vision

Value Chain Analysis

Total Quality Oriented

Customer Driven

Speed Oriented

Innovative

Information Based

Global

Paradigm Shift of SMEs

Vs

THANK YOUTHANK YOUTHANK YOU

701D, Level 7, Tower D, Uptown 5,No.5, Jalan SS21/39Damansara Utama

47400 Petaling JayaSELANGOR, MALAYSIA

Tel. No. 603 – 7628 7400Fax No.: 603 - 7660 1919Tol Free: 1800-18-1801

Email : info@smidec.gov.mywww.smidec.gov.my