| The industry is expected to grow at a CAGR of 15% | | | | Malaysian company moving up the value chain in |
| to reach $1.9 billion by 2013. Currently, IT outsourcing | | | | outsourcing. The company specializes in |
| services in Malaysia has a greater share of the overall | | | | computer-aided stress testing for engines of Boeing |
| outsourcing market, followed by BPO services; while | | | | and Airbus.” |
| knowledge services outsourcing, still in its nascent | | | | Finding its own niche will be critical for the Malaysian |
| stage, has a smaller share. Government support, | | | | outsourcing industry to sustain its growth. For example, |
| domain knowledge and industry expertise in BFSI, oil | | | | a majority of the local Malaysian service providers |
| & gas and logistics has benefited the growth of | | | | serve the Asian and the Middle East markets. They |
| the Malaysian outsourcing industry. Moreover, | | | | are well poised to address the outsourcing opportunity |
| Malaysia’s multi-cultural and multi-lingual cability is | | | | in Islamic banking services from these markets. |
| attracting business from Asian markets like China, | | | | With consolidation and collaboration at the service |
| Japan, South East Asia and the Middle East. According | | | | provider’s end and strong initiatives from the |
| to Arun Jethmalani, CEO, “Companies in the BFSI, | | | | government for the outsourcing industry, Malaysian |
| oil & gas and logistics sectors, which had set up | | | | service providers will receive greater recognition in the |
| operations in Malaysia decades ago, are leveraging the | | | | global markets. However, given the challenges, |
| country’s multi-lingual ability and domain expertise in | | | | providers will find it difficult to make a significant dent in |
| these verticals to set up IT and BPO centers in | | | | the outsourcing market. Considering the scale, a |
| Malaysia.” ( ) | | | | focused approach backed by the government and |
| Malaysia has been recognized as one of the preferred | | | | industry initiatives will drive the success of the |
| destinations for outsourcing, however it faces some | | | | Malaysian outsourcing industry in the long term. |
| challenges. One of the major challenges for the | | | | This report provides an in-depth analysis of the service |
| Malaysian outsourcing industry is to overcome | | | | provider landscape in Malaysia. The report brings out |
| constraints with regards to scalability. The total number | | | | the key strengths and challenges faced by the |
| of employees in the industry is roughly comparable to | | | | country's service providers. The report also highlights |
| the number of new hires by a leading Indian IT | | | | the growth drivers and provides the key trends and |
| outsourcing service provider. Employee costs, too, are | | | | insights for opportunities in the Malaysian outsourcing |
| 15% to 20% higher when compared to other popular | | | | industry. Outsourcing Malaysia (OM) is an initiative of |
| destinations like India. | | | | the Malaysian outsourcing industry and a chapter of |
| One of the key concerns for the outsourcing industry | | | | PIKOM. With support from its institutional partners, the |
| in Malaysia is the need to move up the value chain to | | | | Multimedia Development Corporation (MDeC), and |
| offer high value services as opposed to highly | | | | senior leaders from the global services industry, this |
| commoditized services in IT or BPO. Says Bobby | | | | outsourcing consortium aims to promote the capabilities |
| Varanasi, an outsourcing consultant, “Strand | | | | and competencies of the Malaysian outsourcing |
| Aerospace Sdn Bhd is a prime example of a | | | | industry. |