Speech by Chief Minister of Penang
for Digital Collaboration & Transformation Conference (DCTX) 2018
22 September 2018
Shangri-La Rasa Sayang Resort, Batu Ferringhi
Mr. Goh Peng Ooi, Founder and Group Executive Chairman
Dr Raymond Kwong, CEO & Group Managing Director
Ladies & gentlemen
Good morning to everyone.
Thank you for inviting me to join you today. To our overseas guests, welcome to Penang! My heartiest congratulations to Silverlake Group on your 30th anniversary and I am pleased to join you all in celebrating the success stories of Silverlake customers who are in the forefront of Digital Financial Innovation and Inclusion. I shall attempt to summarize the development of digital innovation and transformation in 3 key areas.
According to global technology research firm, IDC. By 2020, total I.T investments by Malaysian financial services institutions will reach nearly USD1.4billion, 23.4% of which will be from new-to-enterprise technologies and business models.
Without a doubt, technology will be a key driver of innovation in the financial industry, bringing us to - FinTech or Financial Technology, which all of you are familiar with and some of you are leading similar programs in your institutions. The introduction of FinTech may has disrupted traditional businesses such as payment, lending or advisory, but the same technology has also made financial services invisible like air – essential, everywhere, effortless. Financial services can now be seamlessly delivered and adjusted to a consumer lifestyle or a business’ operations.
A.I & Automation, Big Data Analytics, Blockchains, Cloud Computing, Internet of Things and other digital technologies are becoming the new catalysts for development of innovative business models beyond banking. Retailers are merging their online-offline shopping experience on cloud environment, Insurers are using machine-learning to better identify frauds and shorten the claim process.
Apart from the private sectors, our government agencies are embracing technologies. We welcome changes that can help increase efficiency, better promote financial inclusion and provide lowering the cost of services.
We are continuously adapting policies to consider the impact of the technology-driven world. At times, we may seem slow in responding but this is for a good reason: as policy maker, we need to anticipate the technological risks to the business operations and impact to the society. It is not always about the latest new technologies that promise to change the world, but the most appropriate technology to fulfil the objectives.
However, technology is just one aspect in our new connected economy. Technology is not an end itself but a means to an end. Technology brings efficiency in collaboration; allowing you to become the platform of financial services, integrating value-adding services from partners in a secured manner.
I am sure “Open Banking” is not new to all of you here. Either driven by regulation (e.g. EU starting from Jan 2018) or market forces, banks are starting to allow third parties access into their customers’ financial data. We are seeing technologies such as Open APIs, to facilitate partnership and the flow of data between banks, fintech and partners. This ultimately benefits the consumers with a better experience.
We are fully supportive of open innovation to promote healthy competition in the financial sector. Bank Negara Malaysia (BNM) has established the Open API Implementation Group to formalize the open API standards so that as an industry, we can agree on a benchmark while having the flexibility to experiment and create unique differentiators.
Malaysia has been playing an active role in facilitating collaboration. One of the ways is through Malaysian Global Innovation & Creativity Centre or known as MaGIC. MaGIC has been bringing together corporates, emerging start-ups, regulators and all like-minded entities to re-define status quo, cope with disruption and simply - how can we do things better and faster.
We have also introduced the Sandbox since 2016, powered by BNM’s Financial Technology Enabler Group. The sandbox helps to improve the speed of innovation by validating the quality, efficiency and security of these new products & services when integrated into the real-world and used by the consumers.
The success of Silverlake is the perfect example of collaboration where the company enrich existing solutions through ecosystem partnerships and joint R&D programs with customers.
We have all heard “Data is the new oil”, which is very true. To compete in the digital-driven future, knowing our customer is not enough. We need to have data mastery to make use of A.I and automation, sharp business acumen to understand how disruptive technologies such as Blockchain will change our business models and creativity to think outside of the traditional boundaries.
The Industry 4.0 will change the way we live, work, play and socialize. Corporates and their employees can no longer limit themselves to the conventional ways to solve a new problem or serving the next generation of consumers.Against the backdrop of global competition, diversity and inclusion will be the key attributes of successful organizations.
Malaysia is a melting pot of cultures, languages and backgrounds. This competitive advantage allows us to nurture, attract and retain world-class talent. As a result, many Malaysia-based organizations have access to a highly educated and multi-lingual talent pool.
All these does not happen by chance. We have invested in various schemes to ensure our curriculums and strategies are aligned to the industry needs and creating platforms to connect organizations with the right talents. Some of the schemes are:
-Bank Negara Malaysia’s Financial Sector Talent Enrichment Programme (FSTEP)
-Multimedia Development Corporation’s (MDeC) training programmes to enhance the students’ digital competencies
-The Human Resources Ministry’s Skills Development Fund provides assistances to Malaysians pursuing programmes to upskill themselves
-Here in Penang, we have started our own development programs – from i40 – a seed funding to help high potential early stage technology startups to scale their business to become the next regional champions.
-And our “Code-on-Wheels”, an initiative to impart coding skills to students in school.
Hence, it is not surprise to learn that, out of Silverlake’s 3,000 engineers and researchers, 2000 of them are based in Malaysia.
We cannot depend on one party to build a sustainable talent development strategy. It is heartening to learn private organizations such as Silverlake, has contributed to similar effort such as Fintech Internship and “ASEAN-Coding for Life”, to boost the technology literacy of the local communities with less resources.
Together with private organizations, I am positive we can inspire, educate and prepare the next generation for the digital economy.
Like Silverlake, Penang has been through similar phases of transformation: From high-tech manufacturing to technology entrepreneur hub where our “Tech-Penangites” and enterprises are partnering to utilize technologies to gain the business competitiveness and achieve customer experience.
Armed with an innovation-culture, world-class infrastructure, strong-yet-transparent government and thriving community of skilled engineers, Penang is well-positioned as the platform for financial services institutions like yourself, to collaborate with our entrepreneurs and becoming the launch-pad to create new higher-value services in the digital economy.
Our developments have attracted global attention. Check out the BBC’s recent coverage of Penang’s transformation as we journeyed to become the Asia's next Silicon Valley. Simply type “BBC Penang” in google.
(Note: this is the BBC video we are referring to: http://www.bbc.com/news/av/business-42686192/the-malaysian-region-that-became-a-hardware-hub)
Today, Silverlake is recognised globally as a leading Digital Economy Transformation Solutions and Services company, with a customer base of 300 institutions, covering banking, insurance, government, retail, logistics, healthcare, education sectors across 50 countries.
The Group delivers high-end quality and state of the art solutions to help their clients remain competitive. The culmination of continuous innovation, open to collaboration and continuous investment on talent, are the reasons why Silverlake remains the top technology provider in the fast-changing technology realm.
I am extremely proud of Silverlake’s achievements and I hope their successes will serve as an aspiration for the local and global organizations in Malaysia.
I am looking forward to witness the company’s next stage of growth and expansion as the Group continues to leverage on the natural advantages of Malaysia as their headquarters to groom the next generation of leaders and developing innovative solutions and achieve services excellence for their clients.
Finally, I wish all of you a very fruitful conference, enjoy your stay in Penang.