LAB 2:

BUMIPUTERA

LAB

Labs established under NATIP LabKPPK

BUMIPUTERA RAW MATERIAL

LABOURMARKETING

AND PROMOTION

LABS

Target on Bumiputera Timber Industry KPPK

KRA KPI 2011

Targets

As at December

2010

2012 Targets onwards

Participation at all level of

the value chain at both

upstream and

downstream activities

200 entrepreneur

for 10 years

49 29 69

Increase Bumiputera

participation on equity and

business from 5% to 40%

( 3.5% growth annually)

40% participation 8.3% 4.8% 11.8%

2010 2020 2010 2020

29

40%200

4.8%

Project Target : Sustainable and significant Bumipreneurs participation at all level of the value chain at both upstream and downstream activities

1) To increase the number of Bumipreneurs 2) To increase the percentage of equity

sharing of Bumipreneurs

KPPK

LAB

MEMBERS

LAB MEMBERS

Sponsor: Dr Jalaluddin Harun Co- Sponsor: Tn Hj. Osman Hj KasimLab Leader : Pn. Noor Laila Mohamed Halip

Facilitator: En. Md. Ridzuan Md Yusof(Proton Holdings)

Sub Lab Leader:Y.Bhg. Datuk Ag. Buhtamam Ag. Mahmun(One Holdings Sdn Bhd)

Asst. Sub Lab Leader: Encik Saliman Sipulin(Sagahalus Sdn Bhd)

Members:

1. En. Steven Sampil (MID )2. Ir. Tn. Hj. Wahid Jaafar (PEKA)3. En. Antin Hj. Ismail (Adhwa Enterprise)4. Puan Hjh. Zaibi Yakin (MTIB)

5. En. Hassan Baharun (Jabatan Perhutanan Sabah)

6. En. Mohd Faizal Rodzak (MTIB Sabah)

7. Cik Hazlinda Zainal Abidin ( MTIB Sabah )

8. Prof. Madya Matyasin Jamil (UiTM Sabah)

9. En. Azman Poji (MITI Sabah)

10. En. Cyril Pinso (Sabah Softwoods)

Secretariat

1. Hjh. Noor Zakiah Othman(MTIB)

2. En. Wan Mohd Hafizi Wan Mohamad (MTIB)

3. En. Mohd. Amin Kadir(MTIB)

BUMIPUTERA

LAB IN

SUMMARY

Sustainable and significant Bumipreneurs participation at all level of the value chain at both

upstream and downstream activities

Increase Bumipreneurs participation on equity and business from 5% to 40% ( 3.5% growth

annually) by 2020

To boost export performance up to 40% by 2020.

Manage to move up ladder in value chain Manage to produce high quality raw material

Getting Sabah and Sarawak to participate more actively in the timber industry

Upstream

- Minimum ownership of 2.5 ha. is eligible for government assistance

targeting 30,000 ha. RM200 million fund allocated for Sabah SME for all types of forest

produce which include timber, rattan and bamboo

- Land availability - to provide land for forest plantation

Downstream

Change in government procurement policy ie. To gazette 30% of wood -based component in

government projects

Provide funds for RD&C to enhance design and innovation

Reinstate government central contracts for Sabah Bumipreneurs

Integrated marketing projects

Set up central raw material facilities

Objective

What should

change?

BUMIPUTERA LAB IN SUMMARY

Develop forest plantation policy for Bumipreneurs smallholders

Establish a viable business model for Bumipreneurs Sabah wood-based industry

To produce 200 Bumipreneurs by 2020

Continuous supply of raw material

Annual sales performance of estimated RM 8 bilion for the next 10 years

How will

success look

like?

What is the

deliverables?

BUMIPUTERA LAB IN SUMMARY

Raw Material

Bumiputera

Lab on BUMIPUTERA

Objectives:• Participation at all level of the value chain at both upstream and

downstream activities

• Increase Bumipreneurs participation on equity and business from 5%

to 40 %

• To boost export performance up to 40%

Proposals: Big Win A1

Marketing & Promotion

Scope Status

BIG

WINS

A1 Govt procurement policy to use

Bumipreneurs produced furniture

A2 Customized financial policy Enhancement

A3 Human Resource Development

Programme

Enhancement

QUICK

WINS

A4 To provide plantation land for

Bumipreneurs

New

A5 Provide immediate market for

Bumipreneurs

Enhancement

A6 Develop databank for wood-based

Bumipreneurs

New

Labour

Apart from the above, other identified initiatives include 9 big wins and 19 quick wins

PEOPLE

Identify talent/expertise - q200 entreprenuer - bDeveloping design skill for products - qUpgrading of business skill - qFree package for entrepreneur to go to trade fair - qAssessment through SCORE - q

STRATEGY

Credible entrepreneur - bEstablish business model - qTrain new entrepreneur - bAnchor-vendor development programme - qTrade fair participation in local and international - q Provide CAD-CAM facilities in MTIB - qMarketing and promotion - q Raw material centre - bVenture to export market through G to G ( e.g : school furniture for 3rd world market) - bAutomation grant - q

PROCESS

Best practices model - bMechanization – quality and productivity - qEnhance productivity - q

Govt grant for ISO 9000 to entrepreneur - q

POLICY

Govt procurement policy to use Bumiputera produced furniture - bProvide market for Bumiputera companies- qProvide plantation land - qReinstate central contract policy - qReinstate central purchasing programme – qCustomized financial policy - bRM20 million to train entrepreneur - qAdequate supply or raw material - b

INITIATIVES

Government procurement policy to use Bumipreneursproduced furniture

To provide plantation land for Bumipreneurs

Provide immediate market for

BumipreneursBUMIPRENEURS

Human Resource Development Programme

Develop databank for wood-based

Bumipreneurs

Customized financial policy

BUMIPUTERA

A1

High

HighLow

A4

A5

Implementation

Difficulties

Quick Win

Big Win

A6

SUB INITIATIVES IMPACT

1 A1

A2

A3

Government procurement

policy to buy Bumipreneurs

produce furniture

Customized financial policy

Human resources development

programme

H

H

H

2 A4

A5

A6

To provide plantation land for

Bumipreneurs

Provide immediate market for

Bumipreneurs companies

To developing databank for

wood-based Bumipreneurs

H

H

H

A2

A3

What is the Initiative/Lab

Why is it Important?

What should change?

How will success look like?

What is the deliverables?

• To secure sustainable market

• To enhance capacity building

• Policy (Federal and state)

• Establishment of Central Buying House / Central Purchasing

• Increase in sales & productivity

• Increase in employment

• Improve in skills & experience

• Proposal for changes in policy can be done by the government at

any time

•Government Procurement Policy to buy Bumiprenuers produce furniture

BIG WIN A1: GOVERNMENT PROCUREMENT POLICY TO BUY BUMIPRENEURS PRODUCE FURNITURE

BIG WINS :

A1

• WHAT : Government procurement policy to buy Bumipreneurs

produce furniture

• PURPOSE : To secure sustainable market

To enhance capacity building

• RESOURCE: Federal & state policy

established of central buying house/central

purchasing

• PERSON CHAMPION : R: DG of MTIB

A: KSP Federal, PS Sabah MOF

S: KSU, KPPK

I: CM, Sabah

C: Bumipreneurs

• DELIVERY DATE : January 2012

What is the Initiative/Lab

Why is it Important?

What should change?

How will success look like?

What is the deliverables?

• Current policy does not favour and allow this sector to

borrow

• To increase working capital for entrepreneurs

• A new derived financial model for this venture

• Entrepreneurs have adequate fund to run the business

• They have new access to funding

• Customised financial policy

BIG WIN A2: CUSTOMIZED FINANCIAL POLICY

• New mechanism for funding

BIG WINS

A2

• WHAT : A new derived financial model for this venture

• PURPOSE : Entrepreneurs have adequate fund to run the business

They have new access to funding

• RESOURCE :SME bank, Agro Bank

• PERSON CHAMPION : : R: Minister of KPPK

A: BNM

S: MITI

I: MOF

C: Bumipreneurs

• DELIVERY DATE : January 2011

What is the Initiative/Lab

Why is it Important?

What should change?

How will success look like?

What is the deliverables?

• To produce 200 entrepreneurs by 2020

(Today : 29 Bumipreneurs)

• To increase the number of Bumipreneurs trained in

this industry

• 20 new entrepreneurs every year

• Training institution can develop a training model for

this sector

Human Resource Development Programme

BIG WIN A3: HUMAN RESOURCE DEVELOPMENT PROGRAMME

BIG WINS

A3

• WHAT : To produce 200 entrepreneurs for the next ten years

•PURPOSE : To increase the number of entrepreneurs trained in

this industry

• RESOURCE : All training provider / institutions and 23 IPTAs

• PERSON CHAMPION : R: DG of MTIB

A: MOHR

S: MITI

I: KPPK

C: Bumipreneurs

• DELIVERY DATE : January 2012

What is the Initiative/Lab

Why is it Important?

What should change?

How will success look like?

What is the deliverables?

• Raw material is the main component in manufacturing

• State government policy on land allocation

• Policy of providing customize financing assistance

• Bumipreneurs gets access to sustainable supply of raw

material

• Availability of raw material for Sabah Bumipreneurs wood-based industry

• Addressing NATIP Thrust 7 – Bumiputera participation

• To ensure continuous & consistent supply of raw material for Bumipreneurs downstream activities

QUICK WIN A4: TO PROVIDE PLANTATION LAND FOR BUMIPRENEURS

QUICK WINS

A4

• WHAT : To Provide Plantation Land For Bumipreneurs

• PURPOSE : FSC raw material furniture (continuous raw material supply for downstream activities)

• RESOURCE : Sabah / Forest Management Unit (Privating100 years) / private plantation companies and individuals

• PERSON CHAMPION : R: Bumipreneurs

A: CM, Sabah

S: MTIB / Sabah FD / Dir. Land Survey

I: Minister of KPPK & Bumipreneurs

C: Bumipreneurs

• DELIVERY DATE : June 2012

What is the Initiative/Lab

Why is it Important?

What should change?

How will success look like?

What is the deliverables?

• To strengthen the business sustainability for Bumipreneurs

companies (for the 1st two years)

(Today : 0.06%)

• Government policy of awarding supply contract to Bumipreneurs

• Aiming on the ongoing big projects in Sabah – Entry Point

Project & Sabah Development Corridor

• Other state and federal government projects

• Establishing credible Bumiprenuers (Wibawa)• Addressing NATIP Thrust 7 – Bumiputera participation

•To provide consistent market for Bumipreneurs

•Identify immediate potential projects for supply

QUICK WIN A5: PROVIDE IMMEDIATE MARKET FOR BUMIPRENEURSCOMPANIES

QUICK WINS

A5

• WHAT : Provide Immediate Market For Bumipreneurs Companies

• PURPOSE : To ensure equitable participation of Bumipreneur

• RESOURCE : 1) Federal and State Government of Sabah

2) Trade Associations

•PERSON CHAMPION : R: Bumipreneurs

A: MOF Federal &Sabah

S: MTIB

I: CM, Sabah

C: Bumipreneurs

• DELIVERY DATE : 4th quarter December 2011

What is the Initiative/Lab

Why is it Important?

What should change?

How will success look like?

What is the deliverables?

• The need of reliable data and info to draw the right

development programme for Bumipreneurs

• To a certain level of competency and competitive edge

• Uncompiling data for Bumipreneurs companies

• Methodology of assistance (has to be customized)

• Reliable methods of assessment by incorporating SCORE

method

• Complete database of Bumipreneurs

•Auditing and profiling Sabah Bumipreneurs at all level of supply chain

QUICK WIN A6: TO DEVELOP DATABANK FORWOOD-BASED BUMIPRENEURS

QUICK WINS

A6

• WHAT : To Develop Databank for Wood-based Bumipreneur

• PURPOSE : Creating appropriate programme to develop and

enhance Bumipreneur participation

• RESOURCE : 1) Federal and State Government

2) Trade Association

3) IPTA ( UiTM, UPM, UMS, etc.)

• PERSON CHAMPION : R: MTIB

A: KPPK

S: MID Sabah / Sabah FD / IPTAs

I: Dewan-dewan perniagaan

C: Bumipreneurs

• DELIVERY DATE : 31 December 2011

DELIVERABLES ISSUES/CHALLENGES CURRENT

STATUS

PROPOSAL

MOF to

change policy

in wood

furniture

procurement

from Sabah

( 1 )

1. Acceptance by MOF to

amend the current policy

1. Open tender 1. Government

procurement

policy to buy

Bumipreneurs

produce furniture

New

mechanism

for

Funding

(2)

1. Conventional banking

institutions reluctant to

extend fund to

Bumipreneurs

1. No more

grant

from

government

1. Derived a new

financial model

for this venture

Bumiputera

DELIVERABLES ISSUES/CHALLENGES CURRENT

STATUS

PROPOSAL

Training

institution

can develop a

training

model for this

Sector

(3)

1. Training is not customized

to the industry

1 Training

programme

not tailored

to the need

of the

industry

1. Tailor the training

to need the

industry in the

followings :

a. Credible

Bumipreneurs

b. Innovation

Technology

c. Skills

Bumiputera

DELIVERABLES ISSUES/CHALLENG

ES

CURRENT STATUS PROPOSAL

• Availability of

raw material

for Sabah

Bumipreneurs

Wood-based

Industry

(4)

1. Scarcity of

acquiring raw

material

2. Unaffordable to

buy at open

market price

1. Inadequate supply of

raw material

2. Less bargaining

power arising from

higher premium price

for certified timber

1. To set up private forest

plantation

2. Subsidized price for raw

material consumed by

Bumipreneurs

• Establishing

credible

Bumiprenuers

(Wibawa)

(5)

1. Lack of

methodology to

identify, select

and groom the

potential and

credible

Bumipreneurs

1. No credible

Bumipreneurs

1. Anchor vendor

development programme.

2. To identify and groom 20

Bumipreneurs annually.

3. To search and identify

better methodology to

identify, select and groom

the potential and credible

Bumipreneurs

Bumiputera

DELIVERABLES ISSUES/CHALLENGES CURRENT STATUS PROPOSAL

• Timely ( up to

date)

Database for

Bumipreneurs

(6)

1. No fund and effort for data

compilation

1. No

comprehensive

compilation of

database on

the

Bumipreneurs

wood-based

industry

1. To provide fund in

order to carry out the

database survey.

2. Cooperation

between Sabah

Forestry Department,

Statistics Department

and MTIB to do the

survey.

Bumiputera

IMPLEMENTATION

No Activities Time

Q2, 2011 Q3,2011 Q4,2011 Q1, 2012 Q2, 2012

4 5 6 7 8 9 10 11 12 1 2 3 4 5 6

1 Government Procurement Policy to buy produce furniture

- To compile &

review current

govt policy

- To propose

amendment of

the policy

- Meeting & briefing

of the new policy to

all related govt

agencies

-

Announcemen

t &

implementatio

n of the new

policy

2 Customized financial policy - Review current financial

policy

- Proposed dedicated

financial policy for

Sabah entrepreneurs

-

Implementati

on of the

dedicated

policy

3 Human Resource Development Programme

- Planning for new model for

training for the industry

- Ministry to have

meeting with training

institutions

-

Implementatio

n of the new

training

moduls

4 To Provide Plantation Land For Bumipreneurs

- Preparing &

finalizing

proposal

- Submission

of proposal

- Evaluation by the

state authority

- Decision

making by the

state authority

- Loan

application

5 Provide Immediate Market for Bumipreneurs Companies

- Preparing &

finalizing

proposal to MOF

- Submission

of proposal to

MOF

- Evaluation by MOF - Decision

making by

MOF

-

Implementation

6 To Develop Databank for Wood-based Bumipreneurs

- Identify & to

apply fund

- Submission

of proposal to

fund provider

- Evaluation by fund

provider

- Decision

making by the

fund provider

-

Implementation

1-2 Years Work Plan

Recommendations

The government to approve

the initiatives submitted by

the Bumiputera Lab (2)