Global Competitive Strategy SOEs Malaysia

Agus W. SoehadiPrasetiya Mulya Business School

National Competitiveness

Indonesia Malaysia

World Economic Forum, Global Competitiveness Report 2011-2012

Stages of DevelopmentStages 1Factor-Driven

TransitionStage 1 to

Stage 2

Stage 2Efficiency-

Driven

TransitionStage 2 to

Stage3

Stage3Innovaion-

Driven

GDP per Capita (US $)threshold*

Weight for basic requirements subindex

Weight for efficiency enhancersubindex

Weight for innovation andsophistication factorssubindex

< 2,000 2,000-2,999 3,000-8,999 9,000-17,000 >17,000

60 %

35 %

5 %

40 %

50 %

10 %

20 %

50 %

30 %

40-60 %

35 -50%

5-10 %

20-40 %

50%

10%

Weights and Income Thresholds for Stages of Development

*For economis with a high dependancy on mineral resources, GDP per capita is not sole criterion for determinationof the stage of development

World Economic Forum, Global Competitiveness Report 2011-2012

c

High Income

Inclusiveness Sustainability

Target USDS 15000-20000

Per capita

By 2020

Enables allcommunities

to fully benefit fromthe wealth of the country

Meets presenceneeds withoutcompromising

Futuregenerations

Rakyat

Quality of Life

Goals of the New Economic Model

c

High Income

Inclusiveness Sustainability

RakyatQuality of Life

Break of logjamvested interestthrough political

will andleadership

PrepareRakyat for

Change

1. Re-engineering the private sector

2. Developing quality workforceand reducing dependency onforeign labor

3. Creating a competitive domesticeconomy

4. Strengthening the public sector

5. Transparent and market friendlyaffirmative action

6. Building the knowledge baseinfrastructure

Enabling Actions Strategic Reform Initiatives Outcomes

Coherent “big push” to boost transformation and growth

The New Economic Model: Enablers and Strategic Reform Initiatives

NEAC 2010

7. Enhancing the source of growth

8. Ensuring the sustainability ofgrowth

NEAC 2010

Growth Can Be Consistent with Distribution

NEAC 2010

Government-Owned Companies

Top 10 Biggest Companies on Bursa as at 29 January 2012

NEAC 2010

Business Operators

LocalPlayer

RegionalPlayer

InternationalPlayer

GlobalPlayer

• Purely localfoodprint

• No brandstrength

• Unclearstrategicdirection

• Insufficientcapable andexperiencetalents

• Strong localpresence

• Local toptalent

• Locallyrecognizedbrand strength

• Have internalresearch

• Regionallyintegratedvalue chain

• Regionallycompetitivetalent

• Regionallyrecognizedbrand strength

• Structuredorganizationaround sectorand geographyfocused

• Operationscapable ofchallenginglocalincumbents

• Internationalteam

• Globalllyrecognizedbrand strength

• Purely run SOEs• on a commercial

basis

• World classoperationscapable ofchallengingincumbentsglobally

• Best-in-classglobal team

• Top brand

Sime Darby Bhd Transformation Journey

Hay Group 2013

Sime Darby Mission

Sime Darby – 5 Years Strategic Thrusts

Plantation Upstream–Mission & Strategic Thrusts

Plantation Downstream–Mission & Strategic Thrusts

Property–Mission & Strategic Thrusts

Motors–Mission & Strategic Thrusts

Healthcare–Mission & Strategic Thrusts

Lesson Learned

• A Renewed Focus on Core Competence

• National interest guides GLCs policy and SOEs strategy

• Building Strong Brand Name and Extensive Distribution Channel

• Develop and Capitalize Business Networking and TechnologicalCapabilities

• Nurturing, attracting and retaining the best and brightest talents

• Aiming for continuous growth in synergistic, related businessthrough horizontal and vertical integration