STIE & Post Pandemic Futures

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RUSHDI ABDUL RAHIM
rushdi@might.org.my @RushdiAR

This basically allows you to use the presentation as you like as long as you acknowledge the source. 2
A partnership technology policy think tank
established in 1993

Tan Sri Dr. Ir. Ahmad
Tajuddin Ali
Co-Chairman Industry
Datuk Dr. Mohd Yusoff
Sulaiman
President & CEO
Datuk Ir. (Dr.) Abdul
Rahim Hashim
Co-Chairman Government

The conception of formula one Malaysia was done in MIGHT
as means to advance the national motorsports
4

MIGHT is instrumental in driving the development of aerospace industry in Malaysia
5

…justify the need for
major investments in the
development of rail
industry
6

… gave birth to these
organizations…
7

…the nation’s
kitchen crew
”
“
8

Industrial growth &
resilience plays a
significant role in
ensuring the prosperity of
society in managing the
threat to the “Future of
Work”.
However, industry
resiliency value extend
beyond provision of jobs.
As the nation move
forward, industrial growth
should also reflect the
shift from a volume-driven
economy to value-driven
economy
#NewIndustrialStrategy
Disruption
Economics of “FEAR” + Economics of “SHOCKS”
Adopted from: Oxford Economics
HEALTH DEMAND SUPPLY
CHAIN
• Rapid
Contagion
• Stress on
Healthcare
System
• Elevated
mortality
• Confidence
plunges
• Business
activity reduced
• Decrease
consumer
spending
• Travel &
tourism on hold
• Global
disruption
• Inventories run
down
• Business
closures
LOCKDOWN
PARADOX
FINANCIAL
STRESS
PRICE SHOCK
• The cruel “lockdown paradox” is that
the more severe the containment
measures are, the faster we’ll get past
the virus, but the sharper the economic
hit will be
• Supply chain shock - rapidly
transformed into a global demand,
supply, & confidence
• Largest decline in activity
• Fiscal policy stimulus is large, it will
buffer the economy from a sharper
downturn, but not prevent it.
• Shape of the rebound is a function of
the timing, severity, duration and

Industrial growth &
resilience plays a
significant role in
ensuring the prosperity of
society in managing the
threat to the “Future of
Work”.
However, industry
resiliency value extend
beyond provision of jobs.
As the nation move
forward, industrial growth
should also reflect the
shift from a volume-driven
economy to value-driven
economy
Global Response
With reference to OECD’s Country Policy Tracker - globally, countries responses
could be categorized into:-
• What are countries doing to contain the spread of the coronavirus?
• How are countries helping people, small businesses and the economy to weather
the crisis and beyond?
Weathering the crisis
• Cash payments for individual
• Unemployment benefits
• Assistance for SMEs
• Supplemental budget for 2020
• Corporate tax relief
• Aid to hard hit industries

#PostPandemicFutures
Malaysian Response
The Malaysian
government has
announced a much
larger than expected
fiscal stimulus package
amounting to RM250bn,
17.1% of GDP. The
additional fiscal
measures focus on
providing more
immediate help to
struggling firms and
workers, and ensuring
adequate liquidity. It is
expected the fiscal
deficit to widen to 4.6%
of GDP this year.
Source: Oxford Economics/Haver Analytics

• If current restrictions are in force for the remainder of the year travel will fall around
80%.
• Hotel occupancy on average has dropped by 80% across Asia Pacific
• According to IATA “Typical airline had 2 months of cash at the start of the year” - airline
failures may follow
Source: Tourism Economics

Exponential technologies has been disrupting traditional industries at an ever-
increasing pace.
… And the pandemic has basically put these changes into hyper-speed. Never
have we had the opportunity to rewrite entire sectors, redefine the problems
they address, and reinvent their solutions.

Brick & Mortar
Retail
Commercial Real
Estate & Offices
Dining &
Restaurants
Education

The current pandemic has been, to say the least, grim for business.
But during this crisis, some companies been thriving because of dramatic
shifts in consumer behaviour.
Restaurants, offices as well sports facilities & gyms are empty as people
stay home to halt the spread of the coronavirus. That's created new
opportunities for several companies.

While most prominent tech companies fret about the effects of the COVID-19 pandemic, Netflix may become even more important in the
daily lives of people forced to stay at home and in front of their televisions. The movement control orders across the globe, combined with
the loss of live events & sports, accelerate the adoption of the types of streaming services that Netflix pioneered. During the pandemic,
Netflix reported 16 million new subscribers.
20

Popular video games like first-
person shooters, football and
cute animals have been a boon
for the top gaming companies.
Activision Blizzard’s “Call of
Duty: Modern Warfare” sales
were up 21% compared with last
year.
Electronic Arts revenue grew
12% compared with last year
benefited from people staying at
home and looking for a
distraction.
Nintendo profit in the first three
months of 2020 more than tripled
compared with the previous
quarter.
21

People can't stop sanitizing,
bleaching & cleaning. That's
benefiting Clorox and Reckitt
Benckiser, the makers of the
world's top cleaning products.
Clorox overall sales jumped 15%
for the first quarter. Sales of
Clorox's cleaning segment, which
includes its wipes and bleaches,
jumped 32%.
Reckitt Benckiser that makes Lysol
and Dettol, is also seeing record
sales. First-quarter sales rose
13.5% because of "strong
consumer demand" for
disinfectants. In March and April,
the sales of aerosol disinfectants
jumped 230.5% and multipurpose
cleaners 109.1%
22

Following the Covid-19 outbreak,
Fitness enthusiasts found a way to
exercise at home through online
courses & home equipment.
Fitness equipment sales grow by
170% during the lockdown.
Peloton makes in-home workout
products, including bikes and
treadmills reported a blowout
quarter: Revenue grew 66% and
membership for its app rose 30%.
Fitness app Keep, posted a
webpage of fitness live on its app
on Jan 31 and had about 56.5
million viewers by early February
23

For people who can work remotely,
online meeting platforms have
become ubiquitous communication
tools.
Slack Technologies added 9,000 new
paid customers, an increase 80%
compared to the previous quarter. Not
only are they adding more people,
users are becoming chattier: "The
number of messages sent per user
per day increased by an average of
20% globally.
Zoom video conferencing tool, has
clearly been the biggest brand to
break out. The company hosts 300
million meeting participants a day,
crossed 200 million daily meeting
participants in March. Its stock is up
120% for the year.
24

Demand for personal safety & health
related gadgets surges in lockdown.
3M reported "strong growth" for its
personal safety products as first-
quarter revenue grew nearly 3% to
$8.08 billion, bolstered by a 21%
growth in its health-care segment
and 4.6% in consumer goods, like
Scotch-Brite sponges.
Withings Thermo contactless
thermometer once reported inventory
depletion. Use of the Thermo is
significantly higher than usual for this
time of year.
Garmin revenue grew by 12% in Q1
2020 driven by demand for personal
health gadget.
25

Online grocery shopping numbers
are officially crazy as
the growth we're seeing was
supposed to happen over four years,
not two weeks. Downloads for online
grocery shopping saw surges of more
than 100%. Though no one is
predicting that brick-and-mortar
grocery stores are going anywhere
anytime soon, the landscape is
changing far faster than anybody
would have predicted, and a
significant chunk of the business is
now moving to online ordering.
Orders for Amazon groceries have
been as much as 50 times higher
than normal. In the U.S. online sales
of consumer packaged goods grew
56%.
26

The region’s food delivery market
is expected to grow to an
estimated US$8 billion in 2025.
In Malaysia, it was reported that
some delivery companies had
recorded more than a 30 percent
increase in orders since a
Movement Control Order (MCO)
was enacted on 18 March.
Ride-hailing companies, Go-Jek &
Grab have jumped on the
bandwagon too to compete with
food delivery “pure-plays” like
Deliveroo and FoodPanda
Cloud kitchens are fast gaining
momentum in Southeast Asia.
27

Disruptive Futures
Disruption (noun) defined as an event that results in a displacement
or discontinuity.
28

ECONOMIC RECOVERY
29
Adopting to A New Normal
The new normal will be depending
on the following drivers of
change:-
• Health - Pandemic containment
• Economic – Economic recovery
• Society - Societal behaviour
PANDEMICCONTAINMENT
ReboundSluggish
Manageable
Ineffective
Compliance
Dissention

Adopting to A New Normal
Things we do
immediately to
respond
specifically to
the crisis
Things we do
and try that is
continued even
in post crisis
Things we
stopped during
the crisis but
requires to be
picked up again
Things we
stopped during
the crisis &
already not
suitable for the
future
DISCONTINUE NEW
DISCONTINUE
NEW
NEW
PRACTICE
OLD
PRACTICE

This will reset the landscape of
industries

Trends that will define post
pandemic futures
Adopted from: MIGHT/Lux Research
Infection
Control
Improve
Resiliency
Remote Work
& Commerce
Better
Agility
Macroeconomi
cs
Impact
Practice of
hygiene,
sanitation &
testing that
continues past
the crisis
Not bound to
geographical
location to
conduct
business &
commerce
Increase local
self
reliance &
rethinking
supply chain
Policies,
practices,
technology &
processes that
enable flexibility
& adaptability
Impacts of
different
scenarios on
macroeconomic
outcomes

After the pandemic, we have to
foresee a future where humans
are not dominating everything;
humans are just one part of
nature. We should not be
arrogant to say we’ll dominate
coronavirus. We’ll be aiming to
survive, under controlled
conditions
Yuko Harayama
Director, RIKEN
Chief Proponent of Japan’s Society 5.0

More Government
Intervention
More scrutiny on
businesses
The implications for the role of the government
will materially affect the way business is
conducted; business leaders in many more
sectors will have to adjust to the next normal of
greater government intervention.
With many businesses likely to be operating to
some extent with public money, the scrutiny will be
intense. That could show itself in the form of more
regulation, particularly in regard to domestic
sourcing and workforce safety.
Changing industry
structure,
consumer
behaviour & sector
attractiveness
Business will be under pressure to change to ensure
continuity of supply is just as valued as cost and
speed to market. Changes of consumer attitudes
toward physical distance, health, and privacy
impacting the tourism, travel, and hospitality sectors
and may see their businesses subject to long-term
changes in business and individual travel
preferences.
1
2
3

Resilience will be
the new buzzword
Distance Is
Back
Even when lockdown restrictions begin to ease,
businesses will need to figure out how to operate in
new ways. Companies need to rebalance their
priorities, so that resiliency becomes just as important
to their strategic thinking as cost and efficiency.
Protectionism & more restrictive immigration & visa
policies are expected. There are more than three
billion people live in countries whose borders are
now totally closed to non-residents; 93 percent live
in countries that have imposed new limits on entry
because of the coronavirus.
On The Bright
Side
The crisis is increasing the pace and scale of
workplace innovation. Businesses are forced to do
more with less, finding better, simpler, less expensive,
and faster ways to operate. Possibly public sector &
regulatory organizations could be forced to transform
& reform.
4
5
6

More Contactless
Interfaces and
Interactions
More Digital
Events
In three areas in particular—digital commerce,
telemedicine, and automation—the COVID-19
pandemic could prove to be a decisive turning point.
With automation, it is becoming possible to imagine a
world of business—from the factory floor to the
individual consumer—in which human contact is
minimized.
At present organizers as well as persons involved
with events are switching to digital events - here are
pros and cons of both. There is no capacity issue,
plus there were attendees logged on from all around
the world. Event organizers will figure out ways the
digital aspects can complement in-person events.
Rise of E-sports
E-sports are thriving. There are even e-versions of F1
car racing on television, and although it might not be
the same as traditional Formula 1 racing, it's giving
people a "sports" outlet. Unlike mainstream sporting
events, e-sporting events can easily transition online.
7
8
9

Work of the future are likely to be more
flexible, agile, networked and connected.
Workplace of the future - The distinction
between our work lives and personal lives
has blurred, workplace is no longer where
but what we carry

Workforce of the Future are people who are capable of recreating themselves
and recreating their capabilities are the ones who will be most successful

TECHNOLOG
Y
BUSINE
SS
DATA
SCIENCE

#PostPandemicFutures
We need to look at initiatives & technologies that support but
not limited to the following objectives:-
Create resilient industries – Making Malaysia industry resilient is
key towards ensuring that they will survive come what may
and continue to support national growth.
Increase self-sufficiency – As one country after another is closing
its borders in the attempt to stop the pandemic, it has given
the realization that it is better to rely on local systems, to be
self-sufficient and create a system that rely less on global
trade.
Rethinking business supply chains - As we embrace globalization,
supply chain has become more complex and spread out
across the world. Production has become more efficient but
more prone to disruption. Perhaps global sourcing that place
an emphasis “Just-In-Time”, “Lean-Manufacturing” which seek
to reduce inventories and workers, needs a rethink.

5G communication networks – What the crisis have shown us that
high-speed connectivity is critical in a world that works through the
internet rather than through physical presence.
43
3D printing technology could help build a
distributed manufacturing base that would
enable to produce critical parts locally in
Malaysia.
5G communication – high-speed
connectivity is critical in a world that works
through the internet rather than through
physical presence.
Video conferencing & virtual collaboration will
become more popular & sophisticated after
this crisis. The use of AR & VR enables remote
operation and production.
Agriculture technology to support precision
agriculture and better harvesting to ensure
food security & the sustainability of food &
agricultural systems.
Digital twins enable the realization of industry
4.0 can be used to run simulations before
actual devices are built and deployed
remotely

5G communication networks – What the crisis have shown us that
high-speed connectivity is critical in a world that works through the
internet rather than through physical presence.
44
Drones would enable medical & other supplies to
be safely transported. During “restricted
movement” time, drones could patrol areas &
observe crowds and traffic more efficiently
Delivery systems – The current crisis has highlighted
the importance of food & grocery delivery. As
restaurants & shops are closed, people are
discovering food & grocery delivery services as an
alternative.
IoT & Sensors –Anything that is “Smart” will require
the use IoT and sensors. Mobilized together with
some of technology listed in this list will provide
solutions during and post crisis
Robots can help doctors’ distance from patients and
help those in isolation cope. The use of robotics
would also enable local production and thus
promote resilience for Malaysian manufacturing
industry.
Recycling & urban mining – To be sustainable, local
economies require local feedstock - recycling &
upcycling technologies can help achieve that
especially technology used to recycle rare and
valuable metals from waste materials.

STIE & Post Pandemic Futures

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