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A Monthly Bulletin for Entrepreneurs

Issue 9

October - November 2016

Complimentary Copy




Expectations for
Budget 2017

alaysias Prime Minister Datuk

Seri Najib Razak will present the
governments annual budget
for 2017 themed Accelerating
Growth, Ensuring Fiscal Prudence, Enhancing
Well-being of the People, on October 21.
Budget 2017 is the second budget under
the 11th Malaysia Plan 2016-2020; the
final leg of our journey towards Vision
2020 as the country hopes to become a
high-income advanced economy. In view
of the escalating cost of living, the budget
is expected to emphasise on addressing
the plight of the people, especially the
Bottom 40 percent (B40) and the Middle
40 percent (M40) income group. At the
same time, it is also anticipated to be a
prudent budget, with the Government
targeting to achieve a 3 percent deficit as
it aims for a balanced budget by 2020.
Despite the weak external environment
due to factors such as the global oil
price, the economic slowdown in China,
the Brexit, and uncertainty surrounding
U.S interest rates, Malaysia is still on
course to achieve an economic growth
of between 4 and 4.5 percent of GDP as

What to Watch Out For in Budget 2017
Page 2-3

by Dr Ghaz

targeted for 2016. Indeed, the government

has demonstrated that it means business
when it comes to the economy, as seen
in several timely measures taken to
safeguard and spur the economy. These
measures include boosting domestic
consumption as the engine for growth
through the reduction in EPF contribution
by employees and the Overnight Policy
Rate (OPR) cut.
On the whole, Malaysian SMEs are
among the key beneficiaries of Budget
2016, receiving an allocation of more
than RM1.3 billion. This reflects the
towards its SME Masterplan 2012-2020,
where it aims to achieve 41% SMEs
contribution to the GDP by 2020. In
carrying the mandate and trust given by
the government to support the SMEs,
the SME Bank had allocated RM200
million for the implementation of the
SME Technology Transformation Fund
and RM500 million for the Industrialised
Building System (IBS) Promotion Fund
programmes to eligible entrepreneurs in
last years budget.

Forecast for Budget 2017 Page 4
Kemudahan Pembiayaan Eksport untuk PKS
Page 5
Internal Factors That May Affect Business
Organisation Page 8
How to Have An Indomitable Spirit During
Sales Recession Page 9
Creating an Effective Job Description
Page 10
En. Ismail bin Asha'ari of
Systematic Aviation Services Sdn Bhd
Page 11
The Lean Startup: Continuous Innovation to
Create Radically Successful Business
Page 12
Page 12


BUDGET 2017?
As we edge closer to the tabling of the
budget, the mainstream and online media
are inundated with wish lists, projections
and even debates. These speculations
include Budget 2017 being an election
budget with the general election due
in 2018, a generous allocation for
development expenditure for Sabah and
Sarawak, a higher 1Malaysia Peoples
Aid (BR1M) handout and a higher cap on
withdrawal of EPF savings for first-time
continue on page 2

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Datuk Mohd. Radzif Mohd. Yunus
Group Managing Director


Sheikh Ghazali Abod, Ph.D
Chief Operating Officer, CEDAR
Norhisham Hamzah
Raja Shahriman Raja Harun Al Rashid
Shahrir Amran
Hayati Abu Seman
Hamdan Mohd Habibollah
Irman Hussain
Nur Amiza Aman
Ahmad Azuar Zainuddin
Muhammad Zafri Ismail Khan
Rusydan Hamedy Rusli
Hanzo Ng

What to Watch Out For

in Budget 2017

by Raja Shahriman Raja Harun Al Rashid

The baseline global growth forecast has been
revised down modestly relative to the April
2016 World Economic Outlook (downward by
0.1% for 2016 and 2017, as compared to a 0.1%
upward revision for 2017 envisaged pre-Brexit).
As for Malaysia, being the only net exporter
of oil among Asias major economies and
the second-largest liquefied natural gas
exporter in the world, Malaysia's economy and
financial markets are suffering as a result of
close reliance on energy markets. The energy
industry contributes to one-fifth of Malaysias
gross domestic product.
As at Q2 2016, Malaysian economic growth
slows to 4.0% (Q1 2016: 4.2%; Q2 2015: 4.9%),
which is the slowest rate of expansion since Q3
2009 during the global financial crisis of -1.1%.
The economy had also expanded at its slowest
pace of quarterly expansion since 2013 at 0.7%.
In terms of export and import, the marginal
growth of 1% and 2%, respectively, leading
to the lowest net exports in three years by
RM19.7b.This led to the GDP growth to be
lower by 0.6% (YoY), confirming worries that
the slow global trade activity will eventually

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affect economic growth. In terms of consumer

sentiment, despite the recovery in July 2016
at 78.5 points, it is still weak and far below the
optimal level of 100 points.
Economic growth as at Q4 2016 is expected
to be at 4% with the domestic demand to
be the main growth driver, while exports are
projected to remain weak given the subdued
global demand.
It is under the above scenarios of prolonged
deterioration of oil prices and weak economic
outlook that Budget 2017 may be a difficult
task. Due to the tight finances amid relatively
lower revenue collection from oil-related
sources, the Government is expected to
announce modest expansionary measures
while keeping its promise to ensure that its
fiscal position remains strong. Based on the
2017 Budget Consultation held on 16th June
2016 chaired by Malaysian Prime Minister,
the theme for Budget 2017 is Accelerating
Growth, Ensuring Fiscal Prudence and
Enhancing Well-Being of Rakyat.

The views and opinions expressed
throughout this newsletter are those of the
authors and do not necessarily reflect the
official position and views of the SME Bank.
Copyright Small Medium Enterprise
Development Bank Malaysia Berhad.
All rights reserved. This publication is not to
be reproduced in part or whole without the
express permission of the copyright holders.
Materials on this publication are protected by
copyrights law. Unauthorised reproduction
or distribution of copyright materials, or any
portion of it, may result in severe civil and
criminial penalties and will be prosecuted to
the maximum extent possible under the law.

SME Bank Group of Companies

BizPulse | Issue 9 : October-November 2016

continue from page 1

When asked to comment on the upcoming
Budget 2017 at the recent Khazanah
Megatrends Forum 2016, the Second Finance
Minister, Datuk Johari Abdul Ghani said that
the government plans to stimulate economic
growth through infrastructure projects with
RM150 billion invested in projects such as the
Mass Rapid Transit (MRT), KL-Singapore HighSpeed Rail and the Pan Borneo Highway. Once
completed, these infrastructure projects would
have a larger and long-term impact on the
countrys economic growth compared to cash
handouts and tax reliefs.
Indeed, the National Budget is as much
about the governments source of revenue
as it is about expenditure. With the benefit
of hindsight, after almost two years since it
was implemented, many today are praising
the governments decision to introduce the
Goods and Services Tax (GST), especially
with oil and gas revenue declining from 40
percent in 2014 to 21 percent the following
year. Although it was only introduced in April

2015, the GST made up 12.3 percent (RM27

billion) of the overall government revenue for
2015. This year, between January to July, the
government has collected RM21 billion from
GST from an annual target of RM39 billion. In
an interview with the New Straits Times, the
Minister in the Prime Ministers Department in
charge of the Economic Planning Unit, Datuk
Abdul Rahman Dahlan said that there is no
plan to review the GST rate as it is already the
lowest among middle-income countries. While
rigorous spending management measures
such as optimisation may not be popular, it
is nevertheless necessary to ensure lower
fiscal deficit.
As Malaysia strives to achieve its goal of
becoming a high-income nation, and balance
its budget by 2020, it is important that our
progress is inclusive and felt by people from
all walks of life, including the broad segments
of Malaysian SMEs from technopreneurs,
Bumiputera, women to social entrepreneurs. The
government has been open to feedbacks from

BizPulse | Issue 9 : October-November 2016


Accelerating Growth while at the

same time enhancing the well-being of
Rakyat means priority would be given
to people-centric projects such as
affordable housing, rural electrification,
water supply and public transportation
projects. Projects such as the LRT and
MRT, the Pan Borneo Highway and the
Petronas Refinery and Petrochemical
Complex in Pengerang Johor which are
still ongoing will continue to support
future economic growth.
However, given domestic demand
would also continue to be the main driver
of growth, the Government would likely
increase the allocation of BR1M and tax
income relief for the lower-middle income
earners to boost consumer spending
It is also expected that the
Government would focus on the

stakeholders by providing platforms

such as the Budget 2017 Consultative
Council meeting and a special website
for members of the public to contribute
ideas in the preparation of the budget.
On a positive note, Datuk Seri
Mustapha Mohamed, the Minister of
International Trade and Ministry has
publically said that his ministry is
lobbying the government a bigger fund
allocation for SMEs in Budget 2017. A
larger allocation would not only build
on the progress already made but also
enable our SMEs to become more
competitive to seize the opportunities
of an economic recovery which some
analysts expect to begin in 2017 and
Dr Sheikh Ghazali Abod is the COO of the Centre
for Entrepreneur Development and Research
(CEDAR), a wholly owned subsidiary of the SME
Bank Malaysia. He can be reached at sheikh.

leverage the transformative power
of science and technology, and instil
the spirit of innovation and creativity
energise the domestic economy. Digital
economy currently contributes 16.3%
to Malaysias gross domestic product.
Given that Malaysia is transforming
its economy based on innovation-led
growth, a thriving digital economy has
the ability to contribute some 20% to
the GDP by 2020. Hence, Budget 2017 is
expected to accelerate Malaysias digital
transformation in line with the 11th
Malaysia Plan.
Further cut in Corporate Income Tax
rate is also expected in order to stimulate
foreign direct investments. Additionally,
there is a possibility of financial
assistance to be given out to SMEs to
undertake export in order to promote the
businesses to penetrate new markets
in line with the recently signed TransPacific Partnership Agreement (TPPA)
"Ensuring Fiscal Prudence would
showcase the Governments measures
in ensuring its fiscal position remains
Despite the fiscal deficit had rising
sharply in 1H16, the Government is
confident that revenue collection will
likely to improve in tandem with the
economic recovery in 2H16 hence
improving its fiscal deficit to meet its
target of 3.1% (lower than 2015s of 3.2%).
Malaysia also registered strong net inflow
of foreign direct investments of RM15
billion in the first quarter of this year from
RM9.9 billion in the same period last year.
Given the above, for Budget 2017, the
Government is expected to show strong
commitment and continue to optimise
their spending. Among the expected
measures are optimising the expenses on

supplies and services as

well as asset purchases.
The Government is
also working towards
bringing down its debt to
a lower level of which it
had transferred RM21.9
billion of civil servants
mortgages to a newly
set-up statutory agency,
the Public Sector Home
Financing Board, thereby
government debt.
Enhancing Well-being of
the People would portray
Budget 2017 proposals
as generous and peoplefriendly.
Focusing on the welfare of B40 (bottom
40% income group), the distribution
of cash assistance to households via
Bantuan Rakyat 1Malaysia (BR1M) is
expected to be higher in 2017 in order to
also compensate the ease of GST burden
on households. As for M40 (middle
40% income group), the Government is
expected to provide tax relief.
Another popular measure that the
Government may undertake in enhancing
the well-being of the people is by
accelerating the supply of affordable
housing. On top of more Perumahan
Rakyat 1Malaysia (PR1MA) projects,
there might be assistance for first-time
homebuyers of low-cost houses by
increasing the allocation of Employee
Provident Fund (EPF) Account in Account
Two from 30% to 40%.Additionally, the
Government is also expected to address
the issue on the gap in terms of obtaining
financing for the total purchase price of
properties as banks are not providing the
full financing.
In terms of GST and subsidy, the
Government is unlikely to increase GST
rate to help sustain the cost of living and
lower cost of doing business. Despite
recent hike in fuel prices on 1st October
2016, further subsidy rationalisation
should be implemented later to ease the
burden of lower income groups.
On top of that, the Government is also
expected to provide opportunities for
people to reskill and upskill, as increasing
the labour productivity rate is key to
becoming a high-income nation by 2020
and to continue with efforts to encourage
women to take their rightful place in the
workplace and in the boardroom.
All in all, the Budget 2017 that will
be announced on 21 October 2016 is
expected to be a modest budget given
the need of the Government to maintain
its fiscal prudence.

Raja Shahriman Raja Harun Al Rashid is the Director of Group Compliance and Risk Management, SME Bank
Malaysia. He can be reached at

Issue 9 : October-November 2016 | BizPulse

BizPulse | Issue 9 : October-November 2016


Forecast for
Budget 2017
by Hayati Abu Seman

here are a lot of discussions going

on this coming budget 2017 and
Prime Minister Datuk Seri Najib
Razak had invites members of
the public to contribute ideas on the
budget preparation. The ideas that
have been contributed by the public are
comprehensive enough which includes
topics such as costs of living, healthcare
services, housing and urban living,
economic development, education and
also transportation and infrastructure.
Besides, more than 90 institutions
have given their suggestions and
opinions to be included in the budget
also stated that the ideas of getting
information and suggestions from both
the citizen and institutions will enable
everyone to contribute and accelerating
efforts to transform Malaysia into a
developed country and one that is
inclusive and advanced by 2020.
Budget 2017 with the theme,
Accelerating Growth, Ensuring Fiscal
Prudence, Enhancing Well-being of the
People will be tabled in the Parliament of
Malaysia on 21 October 2016. According
to United Overseas Bank (Malaysia) Bhd
(UOB Malaysia), the upcoming budget
will unlikely have big giveaways as the
government seeks to maintain fiscal

prudence to avoid the risk of sovereign

outlook or rating downgrade.
The main expectations would be in
the continuous effort to uplift the bottom
40 per cent of households, middle 40
per cent of households (M40) and civil
servants. These segments as stated by
UOB Malaysia have a higher propensity
to spend with a positive impact on
consumption and growth. Another issue
expected to be highlighted on the budget
is on the digital economy and the usage
of Information and Communication
Technology (ICT). As there are an
increase in the concern about the Forth
Industrial Revolution which enabled by
the popularisation of mobile devices,
unprecedented processing power, storage
capacity and access to knowledge.
To overcome this challenge, budget
2017 is expected to focus on how
Malaysia can capitalise on the digital
and sharing economy that is becoming
more and more important sector for the
country. Another issue that is expected
to be the focus of budget 2017 would be
to help middle and lower income earners
secure affordable homes. Treasury
Secretary-General Tan Sri Mohd Irwan
Serigar Abdullah said that the Finance
Ministry is in talks with four major banks
on how 1Malaysia Peoples Housing

(PR1MA) can deliver affordable homes

to these groups. So, property buyers,
especially those looking for their first
house, may see more goodies coming in
for them.
Overall, the upcoming budget 2017
would not differ so much with the
budget 2016 that had a total allocation
of RM267.2 Billion, made up of RM215.2
and RM52 Billion in development
expenditure. Khazanah Nasional Bhd
sees a continuation of a pro-growth
and pro-society focus in the upcoming
budget and would also likely to be fiscally
responsible on the back of a challenging
global economic environment. The
government targets to reduce the fiscal
deficit to 3.1 per cent in 2016 and further
improve it next year. Thus, bigger chunks
of the budget will be focused on growth
areas like transportation, logistics, digital
economy, value-added exports, tourism,
higher BR1M cash handouts, tax relief for
middle-income earners and property and
affordable housing.
Besides, it is believed that the budget
would also allocate a specific budget
for programmes to be conducted for
the mid-tier companies and Small and
Medium Entreprises (SMEs). Under the
11th Malaysia Plan, the government
is committed to assisting the midtier companies and SMEs. For Gross
Domestic Product (GDP) forecast, it is
best to assume that the government
would maintain their outlook of 4-4.5% for
next year giving continuous uncertainties
in the global economy


1. Budget 2017 is likely to be modestly 1. Fiscal stimulus efforts would continue 1. The budget will focus on addressing the
rising cost of living faced by the bottom
to be reinforces by off-balance-sheet
expansionary at best as the government
40% household income group (B40) and
mega infrastructure projects and fiscal
keeps fiscal discipline amid a slow
middle 40% household income group
spending by the government-linked
economic growth and low crude oil
(M40) so that they will not be affected
companies (GLC).
by the economic downturn.
2. Budget 2017 should highlight services
personal tax rates after rationalizing 2. The future development expenditure of
on new economic engines of growth
the government will focus on projects
the subsidy and implementation of the
that will be beneficial to the people and
GST. The government is also keen to
Region, services sector with emphasis
provide significant multiplier effects to
further refine the subsidy program so
focus on the telecommunication sector.
the economy.
that it is more targeted at deserving
3. Emphasis on high infrastructure
3. Selected relaxation in the property
spending (rails, roads, maritime and 3. There are also plans to relook all the
sector, particularly on re-allowing DIBS
aviation) and selective relaxation for
(interest cost absorption scheme) for
45 companies under the Ministry of
first-time house buyers and promoting
Finance (MOF) to see if theyre any
property purchases
affordable housing.
duplication of roles.
4. Opportunities:
Grow the companies that make
Information and Communication
money and consistently declare
dividends to the government
Leverage the transformative power of
Try and revive of close companies
science and technology, innovation.
that are loss-making with growing
Value-added exports
Transportation and logistics
Keep companies that loss-making
Digital economy
but involved in providing services to
the general public

Hayati Abu Seman is the Head of Business Intelligence section of the SME Banks Corporate Planning. She can be reached at

BizPulse | Issue 9 : October-November 2016

BizPulse | Issue 9 : October-November 2016


Kemudahan Pembiayaan
Eksport untuk PKS
oleh Hamdan Mohd Habibollah

sederhana (PKS) mengimpikan
untuk ke peringkat antarabangsa,
tetapi ramai mengambil langkah
ke belakang kerana kekangan kewangan
kekurangan pengetahuan. Walaupun
membentuk 98.5% daripada keseluruhan
perniagaan di negara ini, majoriti PKS
hanya memenuhi pasaran tempatan.
kuasa membeli yang semakin lemah
sejak kebelakangan ini, PKS disaran
supaya lebih serius memandang ke arah
pasaran eksport untuk mengembangkan
perniagaan mereka. PKS Malaysia
jumlah eksport dan kerajaan mahu
meningkatkannya kepada 23% pada
tahun 2020. Komuniti Ekonomi Asean
(AEC) adalah platform yang amat sesuai
pada masa ini untuk PKS Malaysia
mengembangkan perniagaan mereka
memandangkan populasi AEC berjumlah
625 juta dan akan menjadi ekonomi


ketujuh terbesar di dunia dan ketiga

terbesar di Asia.
Keadaan semasa sudah pasti berdaya
saing tetapi kita bukanlah satu-satunya
negara di rantau ini yang menghadapi
kejatuhan nilai mata wang. PKS digesa
terus mempromosi perniagaan mereka
dengan mengambil bahagian dalam
program-program dan aktiviti-aktiviti
yang di dianjurkan oleh agensi-agensi
kerajaan seperti MATRADE dan SME
Bank. Malaysia adalah pengeksport
yang ke-23 terbesar di dunia dan telah
menandatangani perjanjian perdagangan
bebas dengan kebanyakan negaranegara utama. Ini akan memberikan
akses kepada sebahagian besar daripada
pasaran dunia yang merupakan peluang
baik bagi PKS untuk mengembangkan
sayap mereka di luar Malaysia.
Sebagai sebuah institusi kerajaan
yang menumpukan kepada pembangunan
PKS, SME Bank telah mengambil inisiatif
dalam menyalurkan pembiayaan kepada
PKS-PKS dari pelbagai latarbelakang

perniagaan untuk menembusi pasaran

eksport. Sehingga September 2016,
SME Bank telah meluluskan sejumlah
RM21.4juta kemudahan bagi tujuan
membiayai aset tetap (loji / jentera
/ peralatan) dan modal kerja kepada
pengeksport PKS dari pelbagai industri
dan aktiviti perniagaan di bawah program

SME-GO ialah program pembiayaan yang dibangunkan untuk menyokong

program Go-Ex (Going Export) di bawah Perbadanan Pembangunan Perdagangan
Luar Malaysia (MATRADE). Ia adalah selari dengan inisiatif Kerajaan untuk
membimbing dan meningkatkan pertumbuhan eksport PKS Malaysia.
Berdasarkan konsep pembiayaan syariah
Pembiayaan Aset Tetap (Loji / Jentera / Peralatan)
Pembiayaan Modal Kerja (Tetap / pusingan)
Jaminan Bank-i / Kafalah
Untuk menyediakan platform pembiayaan kepada PKS yang layak di bawah
program Go-Ex
Untuk menyokong PKS yang terlibat atau bersedia untuk memulakan
perniagaan dalam industri eksport
Pembiayaan maksimum sehingga 100% (pembiayaan minimum RM250,000)
Tertakluk kepada Harga Berasaskan Risiko Bank
Tempoh pembayaran balik maksimum sehingga 15 tahun
Perniagaan milik warganegara Malaysia (> pemilikan 51%): Sdn Bhd,
Perkongsian dan Pemilik Tunggal.
Minimum 3 tahun dalam perniagaan (termasuk tahun beroperasi). Untuk
Perniagaan Tunggal, Perkongsian Liabiliti Terhad atau perkongsian, ia mesti
dalam baris yang sama perniagaan.
Terlibat dalam industri yang digalakkan kerajaan dan sektor yang dikenal pasti
oleh Bank dari semasa ke semasa.
Hamdan Mohd Habibollah merupakan Ketua Perbankan Usahawan, SME Bank. Beliau boleh dihubungi
Issue 9 : October-November 2016 | BizPulse

BizPulse | Issue 9 : October-November 2016


by Corporate Planning , SME Bank Malaysia



Oil prices (3rd October 2016, Monday) Oil

rose more than 1% on Monday, with Brent
settling above USD50 a barrel the first time
since August, after Iran exhorted the need for
other oil producers to join OPEC in supporting
the market. Brent for December settlement
increased USD0.70 (1.4%) to USD50.89 a
Ministry of Energy, Green Technology and
Water: Malaysia is expected to implement
net energy metering (NEM) in 2017 and
preparations are on track for its scheduled
November 1, 2016 implementation. It is a
mechanism where an eligible consumer
installs a solar photovoltaic (PV) system
primarily for own use while the excess energy
to be exported to the grid. Consumers would

receive credit for the excess energy supplied

to the grid to offset part of their electricity
bills provided by the distribution licensees
such as Tenaga Nasional Bhd (TNB) and
Sabah Electricity Sdn Bhd (SESB). The
implementation of the NEM is also an effort to
ensure sustainability of the solar PV industry.


International Energy Agency (IEA):

Global energy investment in 2015
amounted to USD1.8 trillion, down by
8% from 2014 mainly due to a sharp fall in
upstream oil and gas investment which fell to
USD583 billion or 25% drop last year and the
agency is predicting that investment in the
sector will fall a further 24% to USD450 billion
in 2016, as low oil and gas prices cut projects

returns on investment.
Goldman Sachs: The Organization of
Petroleum Exporting Countries' (OPEC)
decision to cut oil production may provide a
short-term support for prices, but chances
are that it is not expecting to change the
supply outlook much. The bank is keeping
its forecast for Brent at USD50 a barrel in
the fourth quarter of this year and USD60 a
barrel in 2017, with WTI expected to trade
at a discount of USD1.50 to Brent prices.
As reported, OPEC members would limit
production to a range of 32.5 million to 33
million barrels per day, down slightly on
Augusts output of 33.2 million barrels a day.


CIMB Research: Analysts maintained Neutral

on the sector rating as KPJ Healthcare
Bhd highlighted that: i) the consumer
sentiment remains weak in 1H2016, ii) costs
of pharmaceuticals have increased due
to the implementation of the GST and iii)
outpatient and inpatient volumes are slightly
weaker due to higher costs and given the
cautious economic outlook. However, KPJ is
cautiously optimistic about the possibility of
better patient volumes in 2H2016. The group
also plans to continue with its expansion
plans. Construction plans have begun in five
locations and the new hospitals are expected
to be completed by 2018.
Pharmaceutical group Apex Healthcare Bhd
is constructing a new oral solid dosage
manufacturing facility (SPP NOVO) in Melaka
for RM68 million. SPP NOVO is a strategic
investment to design, build and operate
an advanced manufacturing facility for the

production and packaging of tablets and

capsules. The construction is expected to
commence in the fourth quarter of 2016 and
expected to be commissioned in the first half
of 2018.


MIDF Research: Analysts reiterate

that the demographics shifts and
developments in the healthcare

markets will continue to bode well for the

sector in 2016/2017. The demographic
factors that encourage the adoption of
private healthcare services are (i) increase
in ageing population, (ii) increase in lifestyle
diseases, (iii) increasing awareness on health
diseases, (iv) improvement in standard of
living and (v) urbanization.
Furthermore, with Ringgit at its current
levels, analysts reckon that Malaysia
is faring better in attracting medical
In addition, the increasing adoptions of
medical insurance policy and employer
tie-up with private hospital operators are
also expected to encourage the usage of
private medical services.
Frost & Sullivan reported that, at the
current growth rate, Malaysias healthcare
expenditure will reach USD20 billion by


Malaysia Airports Holdings Bhd (MAHB) saw

5% YoY more passengers pass through the 39
airports it manages in the country, bringing
the number to 7.53 million compared with
7.17 million a year ago.
The international sector recorded 3.7
million passengers in August 2016, up
5.2% over the same time last year, while
the domestic sector recorded 3.8 million
passengers, a 4.9% rise.
Malaysia is expected to attract more regional
tourists as 85 Asean celebrities converge on
the nations capital for the Asean Celebrity
Explore Quest Malaysia 2016.
The Asean Celebrity Explore Quest will
expose the participants to the best of
what Malaysia has to offer and share
their experiences with the social media
followers, attracting them to the country.
Asean tourists account for 74% of visitors
to the country. In 2015, Asean tourists
contributed 19.1 million arrivals and
BizPulse | Issue 9 : October-November 2016

RM44 billion in receipts, out of a total

25.7 million arrivals and RM69 billion in


A new set of passenger service
charges (PSC) or airport tax is set to
be implemented by January 1, 2017
on air travelers. Apart from domestic and
international categories, the new PSC rate
structure will feature a new category for inter-

Asean flights, which will benefit those flying

to other Asean nations.
The government will put more effort into
spurring the nations medical tourism
industry to achieve its target of RM4.2 billion
in revenue by the year 2020. The nation was
strategically located in the Asean region to
tap the growing number of travelers seeking
quality healthcare treatment.
Government are targeting one million
health travelers this year which is
expected to generate some RM1.0 billion
in revenue.
The number of healthcare travelers
seeking medical treatment in Malaysia
has increased steadily over the last
three years, with some 881,000 travelers
in 2013, generating RM726 million to
882,000 in 2014, generating RM777
million in revenue and last year, 859,000
healthcare tourists brought in RM914
million in revenue.

BizPulse | Issue 9 : October-November 2016

Business Alert


Malaysian Institute of Economic Research

(MIER): The Automotive Industry Index (AII)
reads higher at 110.0 points in 2Q2016 from
83.3 in 1Q.
The CI gains 8.6 points to settle at 53.3
points and EI strengthens by 18.1 points
to settle at 56.7 points. Higher vehicle
sales were boosted by festive promotions.
The outlook for auto sales in the next
few months will remain competitive
and challenging due to macro factors
influencing the sector include regulatory
changes, forex trends, availability of
financing, consumer behavior patterns
and consumer sentiment.
International Air Transport Association
(IATA): Global demand for air travel rose by
4.6% in August, slowing from a 6.4% increase
in July 2016 as the airline industry continues
to see the effect of terrorist attacks in Europe
on demand.
August international passenger demand
rose by 4.7% compared to August 2015.

All regions recorded increases, but growth

was dominated by airlines in the Middle
Demand for domestic travel climbed
by 4.3% in August from a year earlier in
all major markets except for Brazil and
Russia, while India and China reporting
double-digit rises.


Boeing: Demand for commercial

airplanes in China is projected to
reach 6,810 new airplanes over the
next 20 years with the estimating total value
of USD1.03 trillion. As China transitions to a
more consumer-based economy, aviation will
play a key role in its economic development.
Also driven by China's growing e-commerce
business - already the largest in the world - air
cargo is expected to become a key driver for the
continuous growth of aviation in China, with the
need for 180 new freighters and 410 converted
investments of USD5.9 trillion for 39,620 new

commercial airplanes to be delivered during the

next 20 years.
BMI: The growth in Malaysia's construction
sector is set to moderate over the coming
years, decelerating from an estimated 10.7%
in 2015 to 7.8% in 2016 and 6.6% in 2017.
Transport segment will remain the bright
spot, driving overall growth, while the nonresidential segment will weight on growth.
Analysts forecast the transport sector
to grow by 9.5% in 2016 and at an
annual average of 8.5% over our five-year
forecast period. The growth will moderate
over the coming decade, averaging 7.3%
per annum between 2016 and 2025.
The railways sector is forecast to
outperform, averaging 8.9% growth
per annum between 2016 and 2020,
supported by a large project pipeline.
Growth in the roads and bridges sector
will also remain strong, averaging 8.6%
between 2016 and 2020.



Singapore internet service provider (ISP)

ViewQwest has launched its fiber broadband
services in Malaysia. The company is offering
speeds of up to twice as fast as existing
providers at lower prices.
ViewQwest will be primarily targeting
enterprise demand for high speed
broadband in key business districts to
generate returns on its fiber network
investments. Coupled with a high
technological base, access to cheaper
broadband will help boost enterprise
adoption of cloud services within
ViewQwest's footprint.
Malaysian ISPs pay about USD20 per mega
bit (Mb) of international bandwidth versus
just USD5 in Singapore. By leveraging
this cost advantage, ViewQwest will
undercut rivals' broadband prices which

average RM30,000 for a 100 megabits per

second (Mbps) enterprise connection, to
offer 1 gigabit per second connectivity at
SGD500 (MYR1,510) a month.
ViewQwest's disruptive prices will
accelerate the adoption of cloud
computing services as businesses can
afford the bandwidth required for their


Malaysia Digital Economy Corporation

Sdn Bhd (MDEC): The Malaysian
e-commerce industry is expected to
boom and grow further with the launch of the
National E-Commerce Strategic Roadmap
(NESR), which is likely to be tabled to the
Cabinet in the 4Q2016. The roadmap is
aimed at doubling e-commerce growth

in the country from the current 10.8% to

20.8% by 2020. It is a proactive effort by the
government to ensure that the e-commerce
application becomes the most important
platform in marketing products and services.
The government is giving full attention to the
development of e-commerce with the setting
up of the National e-Commerce Council
besides forming the Strategic E-Commerce
Direction Plan soon.
International Data Corporation (IDC): The big
data and business analytics (BDA) market
is predicted to hit USD203 billion in the year
2020, up from USD130.1 billion in 2016. The
market was worth an estimated USD112
billion in 2015 and is expected to grow at an
annual compounded growth rate (CAGR) of
11.7% through 2020.



Thai shopping mall developer Central Pattana,

which operates 29 malls in Thailand, plans
to open its first foreign outlet in Malaysia in
2018. The new mall, which will cost about 8.3
billion baht (USD232 million), will be located
in Shah Alam.
iPay88 Sdn Bhd: Online shopping in Malaysia
is on the verge of a turning point as the
country's eCommerce scene undergoes a
dramatic change, backed by increased user
The two key disruptive driver trends
that supported higher user confidence
are Technological-wise, which is a new
solution innovation that make funds
immediately available while Behaviouralwise is an online shopping pattern
towards higher value items such as

automobile, property and professional

As for the technological-based driver,
iPay88 is currently working with selected
partner banks to approve personal loans
for online purchase. The company is
emulating what Alibaba has been doing
since mid-2015, to offer their customers,
financial loans based on their online
shopping history.


(BMI): Despite the current economic
headwinds and lower consumer
sentiments, household spending in the
retail sector is anticipated to pick up from
2017 onwards. Rapidly rising incomes and
accommodative monetary policy will support

a gradual shift towards greater spending

on non-essentials, higher-quality essential
products and services. The country's youthful
population will drive strong demand in the
areas of education, consumer electronics
and recreation & culture. The headline retail
During 2016-2020, analysts forecast
headline household spending to increase
at an average rate of 8.4% per annum,
reaching a total figure of USD254 billion.
Rising from a low base, education will
enjoy the strongest spending growth
rate, forecast at 9.8%. On the other side
of the spectrum, housing & utilities will
demonstrate the weakest growth figure,
forecast at 7.4% during 2016-2020.

Issue 9 : October-November 2016 | BizPulse

BizPulse | Issue 9 : October-November 2016


Internal Factors That May Affect

Business Organisation
by BizPulse Team

he role of company leadership

is an essential internal factor.
Your leadership style and
other management style
impact organizational culture. Often,
firms provide a formal structure with
its mission and vision statements.
Some cultural implications which
result from leadership approaches
are value of employees; the positive
or negative nature; and effectiveness

In a high performing workplace,
the workers not only have talent,
but they also work better together.
The employees and departments
collaborate on ideas and resolutions.
The internal factors basically include
the inner strengths and weaknesses.
Internal factors can affect how
a company meets its objectives.
Strengths have a favorable impact
on a business. Weaknesses have a
harmful effect on the firm.

Some examples of areas which
are typically considered internal
factors are:
Financial resources like funding,
sources of income.
Physical resources like companys
location, equipment, and facilities
Human resources like employees,
target audiences, and volunteers
Access to natural resources,
patents, copyrights, and trademarks
Current processes like employee
programs, software systems, and
department hierarchies

Companies must also consider
softer elements like company culture
and image, the role of key staff,
operational efficiency and potential.
BizPulse | Issue 9 : October-November 2016

The most common internal factors

that might affect your business in
various ways are:
These are a part of the operational
and administrative procedures. This
includes disorganized or inaccurate
record keeping. Interruptions to your
supply chain and outdated or faulty IT
systems are also factors you should
evaluate. If you do not overcome
these, your customers might see you
as unreliable. You can also lose all
your data.

These affect your firms ability to
reach the goals in the business plan.
They could be due to the impacts of
changes in technological evolutions
or customer demand. These factors
could pose as threats as they can
alter how customers perceive your
product. Based on these, customers
might think a product is overpriced,
dull and outdated.
Your business needs innovation in
order to keep up with competitors.
It is essential to get one step ahead.
Innovation could come in the form
of marketing. It could also be
through promotional initiatives in the
marketing plan, staff training, and
welfare. Embracing new technology
is the best way to keep up with
technological advancements.

A lack of innovation can pose a
serious risk to a growing business.
No innovation will cause a company
to remain boring. The company will
become dull, stagnant and irrelevant.
The financial risks depend on the
financial structure of your business.
It is also dependent on your business
transactions and the financial
systems. For example, changes in
interest rates or being overly reliant on
one customer could affect business.
Employees are vital to business
success. But, there are risks
associated with them. For an industry,
strike action could lead to a lot
of problems.

BizPulse | Issue 9 : October-November 2016


How to Have An Indomitable

Spirit During Sales Recession
by Hanzo Ng

I cant do it!; It is too tough!; Its

hopeless; Market is bad!; Competitor
keep throwing prices!
These have been the typical
responses I hear throughout the year thus
far. Honestly, it is not new. I hear these
limiting mindsets all the time even
during good times. Amid the current state
of economic uncertainties, how would
you boost your resilience and persistence
to keep fighting for sales by having an
indomitable spirit?
The answer is ABC!



What do you need to do

every single day to deliver
results? Many people go to
work aimlessly. They have no idea what
they need to do or what they need to
accomplish. The first step is always have
an aim be it a target or a goal.

How many prospects do you need to
talk to daily? On the personal side, what
do you want to achieve? Do you want to
travel? Do you want to change your car?
Do you want to save up for your childrens
education? Let your life goal become your
sales goal. By aiming the right target, you
will focus on the right things.
There are wrong and right
mindsets. Beliefs are mindsets.
What you believe in would
eventually become true because we will
defend it through justification. Mindsets
work the same way. What we think and

what we say everyday becomes the


An example of wrong mindset is
when one tends to think that the targets
are too high and I will never achieve it.
The right mindset would be the targets
are high so I better put in more effort to
achieve it!

What are your beliefs? You got to be
aware what you say every day because it
affects you and the people around you.
Change your mindset, change your beliefs.


Take the challenge! We are in the

environment where its harder
to get sales but are you ready
to take the challenge? However, if you do
take up the challenge, remember this
challenges are never comfortable.

If you are used to a comfortable
environment, you will not survive in tough
environments. Thats why you need to
challenge yourself out of your comfort

zones or situations where you are not

accustomed to. Many veteran sales
people are comfortable serving existing
customers but right now, they need to
hunt, make cold calls and acquire new
clients which requires lots of effort and
the ability to handle rejections.

If you challenge yourself, you will
ultimately grow, progress and eventually
create more opportunities than you can
ever handle. Challenge yourself to achieve
your targets or go beyond it!
No matter how tough the situation is,
keep your fighting spirit high. Build
that indomitable spirit that you cannot
be conquered by negativity, rough
competitors or demanding customers.

Get up every day by having an AIM
what you need to do and accomplish;
BELIEF you can do it with the right
mindsets, and CHALLENGE yourself to
achieve your goal no matter how difficult
the situation is. YOU CAN DO IT!

Hanzo is currently the Group CEO of The Sales Ninja Group, a regional sales solutions company. For more
information on Sales Ninjas programme or training, visit

Issue 9 : October-November 2016 | BizPulse


BizPulse | Issue 9 : October-November 2016


Creating an Effective
Job Description

reating a clear job description

before you begin the hiring
process can help you choose
the best candidate from a
pool of applicants. It usually
consists of two areas -- a summary of
the job's responsibilities, and a list of
the key duties that will be performed. It's
worth your time and effort to think the
job description through completely. A
confusing, hazy, or incorrect description
can make it much harder for you to match
a candidate and a job, because you're not
sure about exactly what the job entails.

an inventory clerk simply as someone

who will "record inventories". Instead,
if you use something like "will assist
classifying and recording inventories by
using standard inventory classification",
you will know you need someone who is
meticulous and follows guidelines and

by Shahrir Amran


Be explicit about the kind of
performance you are looking for from
someone, and whenever possible look
for ways to quantify those criteria with
numbers or dates. Otherwise, you may
find that you have hired someone who
can perform the necessary tasks but
falls short in productivity or throughput.
For example, will an account manager
be working with one, four or ten
accounts at a time? Will a bookkeeper
be expected to update accounts
receivable daily, weekly or monthly?

An accurate job description is also

essential for drafting classified ads, job
postings or other recruitment efforts. It
lets you be clear on exactly which talents
you're looking for, and focus your ad
on those attributes to attract the most
qualified candidates.
Use the tips below when you are drafting
a job description:

Be as specific as possible when you
describe the duties and responsibilities
you will need this employee to
perform. Think in terms of the benefits
this employee will provide to your
organisation or to your customers/
clients. For example, don't describe
BizPulse | Issue 9 : October-November 2016

Once you have created a list of
responsibilities and duties, put them in
order of importance. Start with skills that
are integral to the job to be performed.
This way you will know what is necessary
for the successful execution of the job,
what simply is desired, and what may
actually be irrelevant. Hiring is often a
matter of trade-offs, so by prioritising,
you're helping yourself determine what
you can or cannot live with.


Spend time with others in your
organisation who will be managing or
interacting with a new employee to find
out what they think the chief duties of
this person should be. Those who are on
the front lines with someone often know
more about what day-to-day skills are
necessary to perform a job successfully.
You will find this input invaluable.

Shahrir Amran is the Director of Group Human

Capital Management, SME Bank Malaysia. He can
be reached at

BizPulse | Issue 9 : October-November 2016



En Ismail bin Asha'ari
Ketua Pegawai Eksekutif

Nama Syarikat
Systematic Aviation Services Sdn Bhd
Bidang Perniagaan
Penyelenggaraan, Pembaikan dan Baik
Pulih (MRO) pesawat, penerbangan
sewa khas (charter) dan latihan
penyelenggaraan pesawat
Alamat Perniagaan
SAS Hangar, Sultan Abdul Aziz Shah
Airport, 47200 Subang, Selangor.
+603 7846 9015

ystematic Aviation Services Sdn Bhd

(SAS) menyediakan tiga perkhidmatan
industri penerbangan yang saling
berkait di bawah satu bumbung,
iaitu Penyelenggaraan, Pembaikan dan Baik
Pulih pesawat (MRO); Penerbangan Sewa
Khas melalui SASair menggunakan pesawat
ringan, bersiar-siar dari udara menggunakan
helikopter, penyemburan dari udara; dan Latihan
Kejuruteraan dan Penyelenggaraan Pesawat.

En Ismail Ashaari, Ketua Pegawai Eksekutif
SAS, telah meluangkan masa bersama BizPulse
untuk berkongsi pengalaman, pengetahuan dan
pendapat beliau dalam dunia keusahawanan.
S: Apakah yang mendorong anda untuk
menceburi perniagaan sekarang dan
boleh ceritakan secara ringkas tentang
perniagaan anda?
Semasa di zaman kanak-kanak, saya sering
melawat bapa saya yang bekerja di Tentera
Udara Diraja (RAF) di Changi, Singapura. Di
sinilah bermulanya impian sepanjang hayat
saya- satu impian yang menjadi cita-cita untuk menjadi seorang juruterbang! Setelah
menamatkan pengajian di Maktab Tentera
Diraja, saya memohon untuk menyertai Tentera
Udara. Malangnya, saya gagal pemeriksaan
fizikal, iaitu penglihatan. Saya mengambil
keputusan untuk melanjutkan pelajaran saya.
Saya melakukan dengan baik dan mampu untuk
naik tangga korporat. Saya berjaya meningkat
kepada jawatan Ketua Pegawai Eksekutif di
sebuah syarikat pengangkutan besar Malaysia,
tetapi semangat keusahawanan saya serta
impian zaman kanak-kanak tidak pernah pudar.
Walaupun tidak dapat terbang seperti seorang
juruterbang profesional, saya menyertai Kelab
Penerbangan Diraja Selangor untuk memenuhi
impian saya untuk terbang. Saya mampu
Swasta dan akhirnya dapat terbang. Namun
walaupun impian saya telah tercapai, semangat
keusahawanan yang kental mendorong saya
untuk mencapai lebih lagi. Dan pada usia 44
tahun saya memutuskan untuk memulakan
perniagaan sendiri dalam industri penerbangan.
Terdapat beberapa halangan dalam
usaha untuk bertapak di dalam dunia korporat.
Antaranya, masalah mencari ruang pejabat

di Lapangan Terbang Subang. Ini akhirnya

diselesaikan apabila mendapat kebenaran
untuk menukar sebuah tandas kecil kepada
ruang pejabat. Itulah bagaimana syarikat saya
bermula. Dengan tenaga pekerja seramai 5
orang, syarikat Systematic Aviation Services
Sdn Bhd meneroka pasaran perkhidmatan
penyelenggaraan pesawat dengan melakukan
kerja-kerja untuk Kelab Penerbangan Diraja
Selangor dan pekerjaan kecil yang lain. Seperti
kebanyakan syarikat lain yang pertama kali
beroperasi, syarikat saya menghadapi pelbagai
cabaran, terutamanya aliran tunai.
S: Apakah strategi atau konsep perniagaan
anda yang berbeza daripada pesaing lain?
penyelenggaraan pesawat pengangkutan
komersial dan ketenteraan, Systematic Aviation
Services diluluskan oleh Jabatan Penerbangan
Awam Malaysia (DCA) dan Directorate General
Technical Airworthiness Malaysia
Komitmen kami dalam penyelenggaraan
adalah berdasarkan kepada garis panduan
piawaian Continuing Airworthiness Maintenance
Organization (CAMO) di dalam menekankan
keselamatan dan kelayakan terbang pesawat.

SASair beroperasi secara kerap dari
Subang Skypark ke destinasi pulau kegemaran
anda. Kami terbang setiap hari ke Pulau
Tioman, Pangkor dan Seletar. Kami juga
menawarkan penerbangan pelancongan KL
Sky atas permintaan. Pesawat kami termasuk
Cessna 208B Grand Caravan, Piper Chieftain dan
Cessna 400 Corvalis. SASair telah beroperasi
sejak tahun 1994. Kami juga menyediakan
penerbangan sewa khas untuk medevac
(mengangkut pesakit ke hospital melalui udara)
dan pengangkutan kargo.

SAS juga adalah organisasi penyedia
latihan yang disahkan oleh Jabatan Penerbangan
Awam (DCA). Kami menyediakan latihan khusus
untuk sukatan pelajaran DCAM / EASA Bahagian
66 dan latihan jenis penyelenggaraan pesawat
mengikut permintaan pelanggan kami dan
mendapat kelulusan DCA. Pusat latihan kami
terletak di Pusat Perniagaan Kelana Jaya dan
kemudahan latihan khusus semasa kerja (on-thejob) yang terletak di hangar latihan di Lapangan
Terbang Sultan Abdul Aziz Shah.

S: Apakah cabaran-cabaran utama yang

dihadapi syarikat dan bagaimanakah syarikat
menghadapi cabaran tersebut?
Pasaran MRO pesawat melalui banyak
cabaran pada tahun-tahun kebelakangan
ini dengan cabaran ekonomi sekarang dan
kemerosotan dalam permintaan berdasarkan
trend kejatuhan pendapatan bagi beberapa
syarikat MRO terkemuka. Baru-baru ini, industri
penerbangan telah menunjukkan tanda-tanda
pemulihan dengan permintaan yang besar di
kawasan-kawasan seperti Asia Pasifik dan
Timur Tengah. Ini dijangka akan bertindak
sebagai satu daripada pemacu pasaran utama
bagi sektor MRO pesawat untuk masa depan
jangka sederhana.

Salah satu cabaran yang dihadapi oleh
penyedia perkhidmatan MRO di Asia adalah
kekurangan kemahiran pakar. Permintaan ke
atas kakitangan mahir dan terlatih tempatan
adalah meluas, terutama dari Timur Tengah
yang menawarkan gaji lumayan. Sering kali,
sebaik sahaja juruteknik khusus mendapat
pengalaman, mereka dilamar dengan kerja yang
menarik dari pembekal perkhidmatan MRO
yang besar. Walaupun kos buruh yang semakin
meningkat di Asia, mereka kekal lebih rendah
daripada di Eropah dan Amerika Syarikat. Hong
Kong dan Singapura mempunyai kos buruh yang
tinggi, manakala kadar di China dan Malaysia
juga semakin meningkat.

SAS amat bertuah kerana mempunyai
model perniagaan yang begitu mampan
dan fleksibel di mana ketiga-tiga segmen
perniagaannya, iaitu MRO, penerbangan charter
dan latihan penyelenggaran pesawat saling
menyokong dan melengkapkan antara satu
sama lain.
S: Apakah pencapaian terbesar syarikat
setakat ini dan aspirasi perniagaan anda di
masa akan datang?
Bermula sebagai sebuah kelab penerbangan
pesawat kecil pada 1994, SAS sekarang
mempunyai 4 cawangan termasuk ibu pejabat
di Lapangan Terbang Subang, Sungai Besi, Kota
Kinabalu, Sabah dan Kuching, Sarawak. SAS
telah berjaya mendapatkan beberapa kontrak
utamanya diperbaharui beberapa kali oleh
pemberi kontrak di atas prestasi perkhidmatan
yang sangat baik.
Kami adalah satu-satunya pembekal
perkhidmatan semburan dari udara di Malaysia,
menggunakan pesawat Grumman Ag-Cats
untuk operasi udara menyeluruh khusus untuk
keperluan pertanian. Grumman G-164 Ag Cat
adalah pesawat pertanian satu enjin, yang
dibangunkan oleh Grumman dari Amerika
Syarikat. Operasi Ag-Cat kami disokong oleh
sistem aplikasi kadar boleh ubah terkini yang
terdiri daripada DGPS (Sistem Pembezaan
Kedudukan Global), untuk tindak balas kepada
perubahan pesat keperluan applikasi aliran
dan ketepatan. Aplikasi racun perosak cecair
dari udara adalah satu operasi yang penting,
terutama di hutan dan kawasan tanaman besar.

SAS juga merancang untuk menubuhkan
cawangan antarabangsa dan sekolah latihan
penuh penyelenggaraan dan kejuruteraan
pesawat. Visi SAS adalah untuk menjadi salah
satu jenama utama dunia dalam industri MRO
pesawat antarabangsa seperti syarikat ST
Aerospace dari Singapura yang merupakan
syarikat kedua terbesar dunia di dalam membekal
perkhidmatan bersepadu yang menawarkan
spektrum yang luas seperti penyelenggaraan
dan perkhidmatan kejuruteraan aero angkasa.
October-November 2016 | BizPulse



BizPulse | Issue 9 : October-November 2016

Reviewed by Ahmad Azuar Zainuddin

The Lean Startup:

Continuous Innovation
to Create Radically
Successful Business

Author : Eric Ries

Hardcover : 336 pages
Publisher : Crown Business (2011)

aunching a new venture has always

been a hit-or-miss proposition.
According to a study conducted
by Shikhar Ghosh, Professor of
Management Practice at the Harvard
Business School, as many as 70 to 80
percent of businesses fail to see their
projected return of investment. From this
statistic, between 30 and 40 percent end
up losing most or all the money they put
in the company. Among the reason for
the high-rate of failures is the allure of a
good business plan, a solid strategy, and
thorough market research, which would
often constricts business from changing
when the initial assumptions does not
meet the customers demand. Indeed, it
seems naive to think that something as
disruptive and innovative as a startup to
be able to fully map its journey sans the
feedback from the customer.
Entrepreneur Eric Ries offers a
more acceptable approach in starting and
managing a startup in the Lean Startup,
published in 2011. This approach draws

upon his early failures and subsequent

runway success, as well as inspiration from
lean manufacturing derived from the
Japanese manufacturing industry. Rather
than wasting time creating elaborate
business plan, the Lean Startup focuses on
the Build-Measure-Learn feedback loop.
Instead of creating a complete product, the
goal of the Lean Startup is to learn what
is valuable to the customer. This process
starts with building a Minimum Viable
Product (MVP), which enable startups
to measure the customers response, and
learn whether to pivot or persevere. For

instance, rather than building a website

with a large inventory of shoes, in order
to find out whether customers were ready
to buy shoes online, Zappos founder Nick
Swinmurn approached a local shoe store,
took photos of their inventory, post them
online, bought the shoes from the store
at full price when a sale is made, and
then shipped them directly to customers.
Based on the MVP, Swinmurn deduced
that customer demand was present, and
Zappos would grow into a billion dollar
business based on the model of selling
shoes online.
A key takeaway of the
Lean Startup approach is: if
you cannot fail, you cannot
learn. The ability to learn
faster from customers is
the essential competitive
advantage that a startup
must possess. While the
Lean Startup approach
is only a few years old,
its core concepts such
as the minimum viable
product and pivoting
have quickly taken root in
todays business world.

Adapted from The Lean Startup, Eric Ries

Ahmad Azuar Zainuddin is a Senior Associate at the Centre for Entrepreneur Development and Research (CEDAR),
a wholly owned subsidiary of the SME Bank Malaysia. He can be reached at




Autopilot Your
Business With SOP



Enterprise 50


Malaysia Promotion
Programme in Sydney,




The Autopilot Your Business with SOP

programme is a 1-day programme that will
equip you with the knowledge and skill-sets
required to prepare a full-set of Standard
Operating Procedure documentation for
your business. Establishing an SOP will
improve your business sustainability,
increase your competitiveness and help
you achieve higher productivity.

Enterprise 50 is an annual award programme

organised by the SME Corp Malaysia and
Deloitte Malaysia to celebrate and highlight
the achievements of enterprising SMEs that
are well positioned for the future. Each year,
50 winners are selected from amongst the
nominations received and the evaluation
is based on key financial and non-financial

Malaysia promotion programme is a

cohesive export promotion programme
across sectors that bring together
Ministries, Agencies, GLCs and the private
sectors. The programme brings forth
clear branding of Malaysia by initiating
greater collaboration across sectors with
a cohesive approach in national promotion

Menara SME Bank

BizPulse | Issue 9 : October-November

October - November2016

Sunway Putra Hotel, Kuala Lumpur

Sydney, Australia