FACULTY OF BUSINESS, ECONOMICS AND ACCOUNTANCY

UNIVERSITI MALAYSIA SABAH

MANAGEMENT (BT12303)

GROUP ASSIGNMENT 1
(Proton Holdings Berhad)

PREPARED TO:
DR. OSCAR DOUSIN

PREPARED BY:
Matric No. Name
YE20210037 ELDIANA SAIBIN
YE20210049 NURFAZILA
YE20210057 KAHARJANNATIN BIN ISMAIL
YE20210062 MOHD NURFIKRI BIN MOHD KAHAL
YE20210063 JOEWINNIE JOSEPH
 CONTENTS

Title Page
Contents I
1.0 Introduction 1
2.0 SWOT analysis for each POLC 3-8
2.1 Planning 3
2.2 Organizing 4
2.3 Leading 5
2.4 Controlling 7
3.0 Proposed Solution 8
4.0 Conclusion 10
Reference 11

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1.0 INTRODUCTION

Proton Holdings Berhad also an acronym of the word Perusahan Otomobil Nasional
Berhad (PROTON) was incorporated in May 7, 1983 to manufacture, assemble and sell motor
vechicles and related products, including accessories, spare part and other component.
PROTON produced Malaysia’s first car was the Proton Saga launched on July 9, 1985 by
Malaysian Third Primer Minister, Tun Dr. Mahathir Mohamed, who had originally conceived
the idea of a Malaysian Car. PROTON became the only national company until the arrival of
PRODUA in 1993.

According to Abdul Rahim, in 1980, Tun Dr. Mahathir Mohamed at the time was the
Minister of Trade and Industry directed MIDA (Malaysian Industrial Development Authority)
to start a research on nationally made projects. As a result, HICOM which is a national
industrial company received help from the Japan automotive company, MITSUBISHI. As a
result of this cooperation, PROTON managed to produce a Saga model. The first established
Proton company has sold this model. HICOM owns 70% of the shares while MITSUBISHI
owns 30%. The Proton Saga model managed to capture 70% of the Malaysian medium-
capacity passenger car market, its success being due to the Proton Saga’s much cheaper price
than foreign cars due to high import taxes on foreign cars and component parts. Although
Proton managed to enter the Malaysian market, the parent company HICOM had to bear huge
losses for PROTON since its inception until 1989 due to technical costs, components,
technology and other from Japan.

One of the main objectives for the creation of PROTON was to propel Malaysia into
the 21st century as an industrialized nation, where the acquisition of technological
knowledge, know-how and expertise that can help the country achieve both short-term and
long-term goals. Objective that includes the development of indigenous research and
development capabilities, world class manufacturimg and production standards, design
capabilities as well as a presence in the global market. Their vision is to become a successful
Malaysian Automotive Manufacturer globally by being customer oriented and producing
competitively priced and innovative quality products. In PROTON early inception back in
1983, the PROTON identity created to symbolize strength and Malaysian heritage. As time
changes, the mark of pride, which embodies the positives qualities that have come to be
associated with PROTON over the years The diamond shape, derived from their very first top
mark, and the colour sheme are a symnol of continuity with our past succes.

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 Today, PROTON currently has 75 3S/4S branches (Sales, Service, Spare Part, Body
and Paint Service) nationwide, thus emerging as the automotive brand with the most 3S/4S
branches in Malaysia. PROTON has made progress in incestice programs for existing dealers
to upgrade their centers to 3S and 4S. It is to standardize sales and services offered to
customers while ensuring that customer satisfaction remains a business priority. PROTON
cars are making their mark internationally as competitive. They are now being exported to 50
countries including the highly competitive United Kingdom and continental European
markets. With concerted and unswerving commitment from customers, business associates,
shareholders, goverment agencies and employees, PROTON is realising its goal of being an
internationally successful Malaysian automotive manufacturer. Its is achieving this by being
customer oriented and by producing competitively priced and innovative products.

Generally, PROTON Holdings Berhad is the first local car manufacturer in Malaysia.
This company has proven that Malaysia is capable of producing its own brand cars and has
further raised Malaysia’s image in the World. Therefore, this research will discuss the SWOT
(Strengths, Weaknesses, Opportunities and Threats) for each management function i.e. PLOC
(Planning, Organizing, Leading and Controlling) for PROTON Holdings Berhad.
2.0 SWOT ANALYSIS FOR EACH POLC

2.1 PLANNING

` The main role of management is Planning, which encompasses all that is done in a
company. It can also be described as the process of setting goals and determining how to
achieve them. Based on information I found, the strength for the Proton Company. Proton's
popularity and good brand image are valuable assets, thanks to its long history as Malaysia's
first "National Car" brand. Furthermore, as Malaysia's largest automaker and the only full-
fledged OEM car manufacturer in South-East Asia with foreign engineering experience,
Proton stands on a solid base of strength with its own CamPro 1.6L engine. This is possible
thanks to the Lotus Group's 1996 acquisition and Petronas' recent purchase of the 2.0L engine
produced by the company in 2016 for a future model.

Furthermore, the weakness for the Proton Company is they have a bad reputation for
providing low quality products. For example, earlier product that they invented was CamPro
engine for the assembly of their Gen-2 model which consumed more fuel than they expected.
Even this issue was already resolved in their recent Car’s Model like the New Proton Persona
(was awarded the Most Improved Model in Fuel Efficiency 2016), their brand still considered
not efficient. Many Malaysian view Proton as a maker of cars that lack of excitement.

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 Proton will gain opportunities access to the right-hand drive segment in Southeast
Asia by bringing Geely on board as a new shareholder. 2017 (Bernama). More specifically,
based on estimates from the Malaysia Automotive Association (MAA), Proton should be able
to tap into local opportunities, with TIV growth of 1.4 percent in the passenger vehicle
segment in 2017 compared to 2016, totaling 522,000 units. TIV is expected to rise from 2018
to 2021, according to MAA.

Among the threats was the MAA listed down challenges in the automotive company
that affect Proton. The biggest threat that mentioned was the continuation of stringent
requirements imposed by local banks to approve hire purchase loans. Household debt in
Malaysia is rising and middle income group which is B40 directly reduced the spending
buying on their New Saga, Iriz and New Persona models.
2.2 ORGANIZING

Proton is the first car manufacturer in Malaysia, Proton makes a profit through the
domestic market. The company is able to penetrate the domestic market to all countries in
Asia but does not use the same logo and brand that exists in Malaysia. The company also
designs various types of car designs as a result of the efficiency in the company's management
to produce 27 types of car models.

The proton company has many advantages in its management. Among them is that
Proton was able to produce various types of cars by exporting the cars abroad until at one
point Proton set a record for Fastest Selling Make of New Car Ever to Enter The United
kingdom because proton exported 164,153 cars between December 1986 and December 1997,
United kingdom was by far the most successful market in terms of accumulated sales. In 1992
the Proton Saga was among the Top 20 best -selling cars in the UK ahead of competitors
mainly from Hyundai and SEAT. Proton management in producing cars that can attract
customers resulting in an increase in demand for Proton cars.

Furthermore, although Proton is a large company but the company also has
weaknesses in the management of upgrading the functionality and design of the car, this is
because the factors that contributed to the fall of proton include the revision of the National
Automotive Policy (NAP) newer original design model Protons (i.e. Proton Waja, Proton
Gen-2 and Proton Savy) that were not maintained were designed and manufactured. As a
result, in the mid-2000s Proton revenue and sales declined sharply. In 2006, Proton’s market
share was 32%, down from 40% in 2005. Proton also lost a majority domestic market share

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for the first time in 20 years to Perodua and Proton’s total sales and market share failed to
recover pre-2002 statistics and perodua remained the domestic market leader from 2006
onwards.

Proton is one of the well -known car makers and exports cars all over the country in
Asia with the success they have gained definitely get a chance. The opportunity they got in
terms of management was that Proton produced a type of Proton hero which was launched in
1993 to be the first car of the company to be released in right and left side drive configuration
provided with this diesel engine because in 1988 proton tried to enter the American market
but failed because it could not meet the automotive regulations of one of the developed
countries which is the strict United States. Therefore, Proton seized the opportunity by
designing Proton like a hero to penetrate the market in the United States.

In doing business there must be competition and threats. The threat in terms of
management that we can get is proton stated by PEKEMA has shifted from its main objective
and the importance of Bumiputera agenda is not the priority of Proton's new management,
Proton's need to upgrade 1S Center which is mostly Bumiputera owned to be upgraded to 3S
center is burdensome because the Bumiputera people do not have the capacity to implement
the measure. Referring to the issue of unfair competition between distributors, Proton said the
new margins and new intensive schemes set by Proton were aimed at preventing unfair
marketing between distributors. As a result of this threat, the demand from the Bumiputera
population will decrease due to doubts. Therefore, Proton took action by increasing the
number of branches to have a positive impact on sales by further increasing customer trust.

2.3 LEADING

The management of proton holdings companies at all levels is more concerned with
those who inspire managers at all levels to provide added value or benefits to the company,
the country and society in exercising formal authority. This situation requires a high level of
commitment and personal responsibility for each employee to lead to an effective vision or
outcome in the management of the company’s organization.

The special strengths of Proton Holdings is to have an effective and systematic

organizational management. This shows that Proton Holdings has leaders who can involve
other parties, namely between leaders and employees in a management. Proton Holdings
Company, also has the ability to distribute tasks. This is very important and necessary in

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terms of leadership because those who work need to understand the tasks given by the boss
according to the ability, experience and knowledge of employees.Moreover, to do teamwork a
leader who leads an organization needs to lead his team and most leaders are not only capable
of leading effectively, but they are also capable of working with each other. For example, they
should be the leading voice in matters relating to problems in the business. They need to play
a big role in solving the problems that are happening in the business.

In the management of Proton Holdings Company, a weakness that is often

underestimated in an organization by a particularly inexperienced leader is to often jump
straight into their ideas without thinking about the planning required in a management.
Through this, the results will be less satisfactory or fail. While the initial idea may be good,
but in this case, the appropriate approach is needed to create long -term success that is to
follow the objectives and direction of the company that has been set. Failing to set clear
objectives, employees will become confused and not know what to do and will continue to be
left with questions and uncertainties. For example, giving instructions and describing
missions related to the Proton company will motivate the work team to ensure that the work is
always running. While it is important to trust each employee with their job, this does not
mean that the leader in charge should leave the job entirely to the employee. The leader must
always remind employees of the objectives and goals to be achieved. Therefore, the leader
should set individual goals for the work and explain how they align with the work of the
broader organization.

Accordingly, opportunities are an external factor that can help businesses to become
more advanced and successful. Opportunities in business management Proton Holdings
Company applies localization as a business strategy. is a business strategy that focuses on a
specific market in a specific area. A common form of strategy used by multinational
corporations to produce products or services that suit the local country. Proton Holdings
Company, seeks to transform foreign subsidiaries into local organizations to suit local
characteristics. In addition, Proton can also reduce the risk of loss, be able to expand the
market and be able to save costs and focus on products that are suitable for the market.

Next, the threats to Proton Holdings Company is the increasing intensity of

competition in the business. There are many proactive competitors around the area cause
many people to compete especially in the same form of business. Competitors are those who
trade to meet the needs of the same consumer or have the opportunity to serve that consumer
where the cost, price and offer as well as the quality made by the competitor also influence
pricing. For example, the Toyota Company also produces the same product which is a car.

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When consumers make a purchase, they will also consider the quality, price and offer for each
product according to the tastes of consumers and their ability from different. Therefore,
leaders need to be wise to install strategies such as pricing strategies, product quality and also
product offerings in order to encourage more buyers to buy products produced by Proton
Holdings Company.
2.4 CONTROLLING

Controlling involves a process of ensuring that employee does not deviate from well
-established standards. Control consists of three steps namely setting performance
standards,comparing actual performance with standards and taking corrective action when
necessary.performance standards are often expressed in monetary term such as revenue, cost,
or profit but they can also be expressed in other terms,such as units produced, number of
defective product, or level of quality of product and services or customer service.
Performance measurement can be done in a number of ways, depending on performance
standards, including financial statement, sales reports, production results, customer
satisfaction, and formal performance appraisals. Managers at all levels are involved in
management functions to control employees to a certain extent.

The strength for the proton company is car product at affordable prices. All
Malaysians have the power to buy proton cars. In addition, proton’s strength is its extensive
nationwide distribution network. Proton is also exported to foreign countries such as England,
the United States, and Arab world. Next up to proton’s strength is also good corporate
governance. Proton’s best practices in governance are applied consistently within the
company and across the group. Proton’s next strength is the influence of patriotisme as proton
is national car maker. Most patriotic Malaysians have always supported products produced in
Malaysia. Government support is also proton’s strength, as the goverment provides financial
support to proton and fosters the production of quality cars. For example, the Government
approved a soft loan of RM1.5 bilion to proton company in an effort to revive the business of
Malaysian automotive companies.

Besides that the weakness of proton company is the product performance and product
function is low reputation. Proton’s reputation is low compared to other automotive
companies like Toyota, Honda and many more.in addition, Proton also requires high costs to
expand their operations with advanced technology because proton uses an insufficient level of
research and deveploment. Furthermore, proton’s weaknesses are also exposed to rising
material costs such as steel tools. Proton lacks R&D or innovation as well as a lack of original
products and limited product due to the company’s failure to introduce genuine new models,

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which led them to discreetly remove their product line. Furthermore, companies with human
resource issues diffrent because of their inability to retain and nurture talent. For all of these
reasons, the company is lacking in international operations.

Next, the opportunities that proton can get is economic growth in china and a large
population. Due to the increasing use of automatic vehicle, the export of local vehicles such
as proton is able to improve the Malaysin economy. Furthermore, owning a car in a
developing country has become a necessity and part of the modern lifestyle especially in
Southeast Asia because the locals can afford to buy cars produced by Proton at affordable
prices.

Lastly, the threats facing proton companies is rising world oil prices. This is because
the country’s income has reached a decisive level.in addition, the increase in world oil prices
continues, it will give room for the goverment to spend and target a better fiscal deficit in
front. The next threat is intense price competition among local car manufacturers such as
PERODUA. This is due to the production of local cars being a very important platform for the
manufacture of goods in Malaysia, especially among the younger generation in Malaysia.

3.0 PROPOSED SOLUTION

First, the proposed solutions to Proton’s is to develop high quality products that can
bring excitement to all Malaysian to buy local car. Proton has also struggled to compete with
international makes even in its home markets. Proton should designed their car with many
moden convenience and safety features including four airbags, double -DIN entertainment
unit, electronic stability programme and not to mention a gusty turbocharged engine to keep
the going enthusiastic. In addition, Proton Holdings should reduced price of their car by 20%
because not all Malaysian able to buy car based on our new economics environment.
Pandemic hit not just Malaysia but all over the world increased unemployment makes
household debt in Malaysia rising.

Secondly, PROTON’s flexible management needs to be more focused to continue to

position its company in the international market. PROTON management not only needs to be
flexible and adapt to an ever -changing environment, but also needs to be committed to
implementing long -term initiatives aimed at further strengthening its engineering and
manufacturing policies. the PROTON brand will become increasingly attractive. this is what
will drive sustainable growth for PROTON and positive returns for shareholders.

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Furthermore, PROTON cannot rely solely on the rapidly growing domestic market. As stated
in PROTON's annual report, the company needs to focus on the export market so that
significant growth can be achieved in the international market although PROTON has a
foothold in several overseas markets, there is a need to explore new markets. In line with
PROTON’s 48 -year roadmap, the company needs to be committed towards expanding its
presence in the region in terms of sales and distribution, especially in Asian countries such as
China, India, and the East.

Next, proposed solutions to weakness problems faced by a leader who leads the
organization. The leader must have responsibility and commitment to perform all tasks in the
management of the organization. for example, when a company faces a problem the boss
should discuss the problem with other employees as well as find a way to resolve it with the
employees through consensus. Tolerance must be instilled in oneself in order to avoid
dissatisfaction with each other. Therefore, it is important to develop talent in the work team
that is to have the passion to build and maintain an environment where people have a personal
commitment to their jobs and give their best to promote the success of the company. Next,
leaders who are transformational in nature can reduce threats occurring. this is because the
leader can organize his employees to perform the task as well as can teach to be trustworthy
and honest in every task. For example, employees will be more trustworthy by not sharing or
divulging company -related information to competitors.

Lasly, the proposed solutions to proton’s is to develop a weak brands name to

continue to support rhe product. Production competition in today’s era is intensifying to meet
the quality of vehicles around the world. Therefore, Proton needs to poduce more efficent
automotive vehicles accoding to consumer demand at present to increase the purchase of
proton branded vehicles in malaysian and various countries that are interested. according to
sinar daily magazine in the business sector shows the proton company has invested more than
rm200 million to build a new automotive vehicle manufacturing plant. therefore, to further
improve high standard machines and machinery to save time in the manufacture of vehicles
produced.
4.0 CONCLUSION

In conclusion, PROTON Holdings Berhad is the first Malaysian car manufacturer

established by Tun Dr. Mahathir Mohamrd which has strengh and opportunities in operation.
However, PROTON need to be constanly sensitive to weaknesses and threats that may be
encountered. Therefore, the Proton can discuss and take improment measures to overcome
these problems. By making improvement, PROTON will certainly become stronger and can

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become a successful wel-know Malaysian car brand internationally. Improvements to existing
cars will also make the car remain relevant and find a place in the hearts of cunsumers.

In this regard, PROTON must also take advantage of the opportumities available to
ensure that the company continues to grow througout the age. PROTON needs to move
forward and several things need to be emphasized such as Proton’s own management, and
also the emphasis in the development division itself so that PROTON can continue to remain
in the automotive industry.

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 REFERENCE

Abdul Rahim. Proton: Profil Syarikat, Latar Belakang Syarikat. 3.

Ameirul Anwar Mustadza. (2020). SWOT analysis enabled Proton to make that critical
decision in moving forward with their partnership with Geely. Retrieved April 28,
2021, from https://marketinginasia.com/2020/11/09/protons-swot-analysis-pre-geely-
partnership/.

Anonymous. (2014, July 9). Sejarah Kewujudan Proton Malaysia. Retrieved April 27, 2021,
from http://allberita.blogspot.com/2014/07/sejarah-asal-usul-proton.html?m=1.

Bisnes BH. (2019, March 8). PROTON Miliki 75 Cawangan 3S,4S Seluruh Negara. Retrieved
April 27, 2021, from
https://www.google.com/amp/bisnes/auto/2019/03/538720/proton-miliki-75-
cawangan-3s4s-seluruh-negara.

BH Online. (2018, January 25). Pusat 3S, 4S PROTON Bertambah. Retrieved April 27, 2021,
from
https://www.google.com/amp/s/www.bharian.com.my/amp/bisnes/korporat/2018/01/
380437/pusat-3s-4s-proton-bertambah.

Cucu Tok Timah. (2014). Kajian Analisis Pendekatan Strategik Syarikat Multinasional
Syarikat Perusahaan Otomobil Nasional Sendirial Berhad (PROTON). Retrieved
April 28, 2021, from http://lukybloger.blogspot.com/2014/12/kajian-analisis-
pendekatan-strategik_14.html.

Sinar Harian. (2021). Bisnes Sinar Harian. Retrieved April 29, 2021, from
https://www.sinarharian.com.my/article/134983/BISNES/Proton-labur-lebih-RM200-
juta-bina-kilang-baharu..

The Star. (2015, July 07). Work Together to Find Solution for Proton. Retrieved April 30,
2021, from https://www.thestar.com.my/opinion/letters/2015/07/07/work-together-to-
find-solution-for-proton.

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