Un­der­stand mar­ket forces and an­tic­i­pate changes

New Straits Times - - Business - The writer is the chief ex­ec­u­tive of­fi­cer of the Malaysia Au­to­mo­tive In­sti­tute

ON Tues­day, the In­ter­na­tional Trade and In­dus­try Min­istry hosted the Latin Amer­i­can Business Day to bridge business, trade and in­vest­ment ties between Malaysia and Latin Amer­i­can na­tions.

I had the priv­i­lege to share my thoughts as a panel speaker for the au­to­mo­tive track. I talked about the di­rec­tion the coun­try’s au­to­mo­tive in­dus­try, in par­tic­u­lar the ex­pan­sion beyond our re­gion. The big­ger hon­our, how­ever, was the op­por­tu­nity to gain in­sight from those around me. I would like to share what I had learned.

One of the key evo­lu­tions we can ex­pect in fu­ture business deals is the way trans­ac­tions are con­ducted. In the past decade, the world saw tremen­dous gains in e-com­merce ac­tiv­i­ties, ex­em­pli­fied through the emer­gence of gi­ant en­ti­ties such as Ama­zon and eBay.

Th­ese cy­ber busi­nesses trans­formed re­tail beyond pur­chas­ing con­ve­nience, and rev­o­lu­tionised pur­chas­ing de­ci­sions, be­hav­iour and mind­set.

Con­sumers grew to be more in­formed on the choices they had.

While the play­ing field be­came more ac­ces­si­ble and trans­par­ent, it also gave birth to the lo­gis­tics night­mare of door-todoor re­tail — con­sumers didn’t need to leave their houses to re­ceive their pur­chases.

Such is the tide of the Fourth In­dus­trial Revo­lu­tion (In­dus­try 4.0). When im­mer­sive con­nec­tiv­ity is thrown into the business foray, even large com­pa­nies can dis­si­pate with­out any signs.

The next mile of In­dus­try 4.0 would most likely shift to the sup­ply chain. We are see­ing signs that global sourc­ing will soon find its way to the same revo­lu­tion. Imag­ine a fu­ture where car­mak­ers source for com­po­nents in an eBay-style bid.

At the Latin Amer­i­can Business Day, I learned that im­port­ing spare parts through e-com­merce has gained pop­u­lar­ity among some Latin Amer­i­can work­shop own­ers.

In an­tic­i­pa­tion of the fu­ture, the Malaysia Au­to­mo­tive In­sti­tute (MAI) and In­ter­na­tional Trade and In­dus­try Min­istry are ad­dress­ing nine core thrusts to al­low Malaysian busi­nesses to flour­ish. Th­ese thrusts form the fun­da­men­tal struc­ture of the MAI In­tel­li­gent Tech­nol­ogy Sys­tems.

One of the key chal­lenges is the man­age­ment of big data. Busi­nesses will need to quickly re­spond to var­i­ous con­sumer, man­u­fac­tur­ing and af­ter-sales data.

MAI has set up a high-per­for­mance cloud com­put­ing server in its head­quar­ters in Cy­ber­jaya, as well as con­nected servers in Kuala Lumpur and sev­eral lo­ca­tions around the world.

Big data will en­com­pass the en­tire sup­ply chain ac­tiv­ity. The com­put­ing power men­tioned above is con­nected to sev­eral sys­tems that cater to the dif­fer­ence dis­ci­plines that make up the au­to­mo­tive in­dus­try.

Process de­vel­op­ment is now made more re­spon­sive through MAI’s Sys­tem In­te­gra­tor and Man­u­fac­tur­ing Ex­e­cu­tion Sys­tem. The need for quicker de­ci­sion-mak­ing in pro­duc­tion plan­ning, pro­cure­ment, sales, mar­ket­ing and fi­nan­cial man­age­ment is ad­dressed through MAI’s En­ter­prise Re­source Plan­ning and In­te­grated In­dus­try In­for­ma­tion Sys­tem.

Con­sumer be­hav­iour can now be un­der­stood bet­ter through MAI’s telem­at­ics pro­gramme. Mo­torists also par­tic­i­pate through ap­pli­ca­tions de­vel­oped by MAI such as MAGIS, Car­bengkel and MyAu­toApp.

To date, eight of nine In­dus­try 4.0 thrusts have been de­vel­oped. The ninth — aug­mented re­al­ity — is ex­pected to be im­ple­mented next year.

Malaysia’s au­to­mo­tive in­dus­try is merely around three decades old. For me, the big­gest les­son we have learned is that re­sist­ing change and mar­ket forces is a last thing we should do. We should fo­cus on pre­dict­ing and an­tic­i­pat­ing change be­fore it hap­pens.

The fu­ture is es­sen­tially about un­der­stand­ing mar­ket forces. To com­pete, we must know our cus­tomers’ needs and re­flect them quickly in our sup­ply chain.

The only thing that is con­stant is change. True power is in those who know what will change and re­act quickly.

In the past decade, the world saw tremen­dous gains in e-com­merce ac­tiv­i­ties ex­em­pli­fied through the emer­gence of gi­ant en­ti­ties such as Ama­zon and eBay.

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