KUALA LUMPUR (Jan 25): The global business services (GBS) industry is expected to buck the trend and register stronger growth in 2017, said Outsourcing Malaysia, a division of the National ICT Association of Malaysia (PIKOM).
“2017 is a promising and ‘disruptive’ year for Malaysia’s global business services industry. The GBS sector [will] further strengthen and position Malaysia as a world-class, high-value based location for outsourcing services via disruptive measures,” Outsourcing Malaysia said in a statement today.
The projected growth, it added, will be underpinned by various factors, which include increasing pressure on global companies to reduce cost, especially in the wake of a moderating economy.
“The attractive incentives and infrastructure within the local GBS sector and the strong U.S. dollar, coupled with various geo-political developments could also potentially see companies relocate existing GBS operations to Malaysia,” it added.
Outsourcing Malaysia said the GBS industry was worth US$670 billion in 2014, with Asia Pacific having the largest market share at 36% or US$240 billion.
Malaysia’s GBS sector is expected to record a compounded annual growth rate of 10% to 15% over the next five years.
“In 2016 alone, more than 6,000 skilled jobs were created for a total of 85,000 jobs — surpassing the target set by 2017,” the association said.
According to Outsourcing Malaysia chairman Cheah Kok Hoong, the various policies and strategies put in place over the years have created long-term value for the GBS sector.
“We will continue to employ new ideas and means to disrupt the status quo — shifting from a ‘low-cost’ value proposition to a high-value based service provider. We are beginning to see the fruits of our efforts. This will be more evident in 2017 — giving us an edge in 2017, despite the many challenges and stiff competition faced from other countries,” he said.
Cheah added that a high-value based model consists of knowledge, talent pool, top class technology enabled infrastructure and a comprehensive legal framework on intellectual properties.
“It will also include access to comprehensive knowledge base, risk mitigation strategies, rapid re-engineering of key business processes and access to specific talent resources. The talent eco-system plays an important role in delivering high value to your clients by filling the gaps in talent employability for the industry,” he said.