Key Takeaways

• • The Center of Technology, Strategy and Sustainability of the Asia School of Business launched the “Industry 4.0 Technology Adoption in Malaysian Manufacturing:
    Strategies for Enhancing Competitiveness” report with the support of the Penang State Government on the 10th of February, 2023.
  • The report found that while firms adopt IR 4.0 to improve productivity and quality, the availability of talent, skills and continuous training remains the biggest challenge to IR4.0 adoption.
  • The report suggested that in the short-term, efforts for continuous talent training and upskilling should be enhanced, including strengthening the technical and
    vocational education system. In the mid-term, the state should develop incentives that match the entrepreneurial discovery of new activities. In the long-term,
    Malaysia needs a new industrial policy to chart a way out of premature deindustrialisation.

Penang, 10 February 2023 – The Center of Technology, Strategy and Sustainability of the Asia School of Business launched the “Industry 4.0 Technology Adoption in Malaysian Manufacturing: Strategies for Enhancing Competitiveness” report with the support of the Penang State Government on the 10th of February, 2023 at The Wembley – A St Giles Hotel, Georgetown, Pulau Pinang. The report launch was attended by policymakers, researchers, academia and the private sector.

The launch was opened by Dato’ Abdul Halim Hussain, Exco for Trade, Industry & Entrepreneur Development, where he welcomed the participants and emphasized on how Industry 4.0 technology adoption is an opportunity for the Malaysian and Pulau Pinang manufacturing sector to move up the global value chain. He stated that his office is exploring public-private partnerships to set up a R&D centre for the benefit of local SMEs.

Dr Tim Sturgeon from the Industry Performance Center (IPC) at the Massachusetts Institute of Technology (MIT) introduced the Work of the Future – Global Research Network research, where this research report is part of the broader collaboration with researchers and universities in Turkey and Brazil to understand technology adoption in emerging economies.

This is followed by the presentation by one of the authors, Dr. Renato Lima de Oliveira, Assistant Professor and Faculty Director of the Center of Technology, Strategy and Sustainability of the Asia School of Business. Professor Renato presented the key findings from the research project. The key findings are as below:

• • Firms adopt IR4.0 technology to improve productivity and quality, and rely on close collaboration with local technology suppliers.
  • Workers are generally receptive to IR 4.0 technologies, as it improves the quality of their work.
  • While several successful industry-led training initiatives have been launched, the availability of talent, skills and continuous training remains the biggest challenge to IR 4.0 technology adoption in Malaysia.
  • Firms need to work closely together with governments, especially in the area of skills and training, both to upskill current workers, and to ensure new workers have the right educational foundation.

Dr Renato also shared three policy recommendations for IR4.0 technology adoption in the manufacturing sector

• • In the short-term, efforts for continuous talent training and upskilling should be enhanced, including strengthening the technical and vocational education system,
    such as partnerships with the private sector through government-led programs, and the formation of community talent-sharing.
  • In the middle-term, the state should develop incentives that match the entrepreneurial discovery of new activities. This may not require large subsidies,
    instead incentives which can help companies innovate along the way.
  • In the long-term, Malaysia needs a new industrial policy to chart a way out of premature deindustrialisation, aiming at the diversification of sectors and jobs in the
    economy and creating spaces for entrepreneurs.