Malaysia’s prime minister Datuk Seri Najib Tun Razak has launched the Malaysia Productivity Blueprint (MPB) on 8 May 2017; and has set a minimum target to achieve an annual labour productivity growth of 3.7% by 2020. The blueprint outlines five strategic thrusts; which include 10 national initiatives, 32 sectoral initiatives and 16 key activities.
“The Malaysia Productivity Blueprint represents a bold step in raising labour productivity to achieve the targets set in the Eleventh Malaysia Plan, 2016-2020, laying the groundwork for an era of unprecedented productivity growth in the country,” stated PM Najib in the foreword.
The blueprint would also serve as a holistic measure to target initiatives to open up potential productivity at national, sectoral and industrial level. These five key strategic thrusts form the basis of its recommendations to raise productivity and address the common challenges – talent, technology, incentive structure, business environment, and productivity mindset.
With those set of challenges in mind, the five strategic thrusts include:
- Building workforce of the future
- Driving digitalisation
- Making industry accountable for productivity
- Forging a robust ecosystem
- Securing a strong implementation mechanism
The blueprint also outlines immediate national-level priorities that require policy reform and the government’s intervention and action within the next 12 to 24 months. For sector-specific initiatives, a roll out in prioritised stages has been proposed. At the enterprise level, the blueprint describes the required expertise and support for enterprises to tackle their productivity challenges on the ground.
MPB national-level priorities
According to the executive summary, there are ten initiatives that require urgent action at national level. Anchored on the five strategic thrusts, they are outlined below.
To roll out these national-level initiatives, sixteen key activities have been identified:
Out of these, six are to be implemented immediately:
- To restructure and improve the management of foreign workers
- To actively encourage adoption of Fourth Industrial Revolution technologies by companies
- To strengthen digitalisation among SMEs through e-commerce and adoption of innovative tech
- To embed productivity targets for enterprises into disbursement processes of new grants
- To remove non-tariff measures that impede growth, and to improve efficiency of the logistics sector
- To evolve governance model to drive game changing implementation of MPB
MPB Sector-specific initiatives
The blueprint has also identified nine priority sub-sectors which collectively contribute to 30% of Malaysia’s GDP, and 40% of total employment. They are retail and food and beverages (F&B); electrical and electronics (E&E); chemicals and chemical products; agro-food; professional services; tourism; information, communication and technology (ICT); machinery and equipment; and private healthcare.
MPB enterprise-level initiatives
According to the blueprint, firm-level intervention is imperative to address specific productivity constraints at the firm level and to ensure the achievement of industry and national productivity targets.
The blueprint proposes an Enterprise Productivity Programme to enable enterprises raise their productivity performance based on a pilot programme that was launched.
The pilot programme involved seven enterprises drawn from retail and F&B, agro-food, and chemicals and chemical products. The programme consisted of two key elements – an Enterprise Productivity Diagnostic (EPD) framework, which is a qualitative assessment of enterprise productivity; and a Productivity Metrics Toolkit, which is designed to enable enterprises collect and track their own productivity data.
Within this framework, four dimensions are drawn including strategy and leadership; operational excellence; talent management; and customer and product experience.