The Malaysia Digital Economy Corporation (MDEC), the lead
agency for driving the digital economy in Malaysia, has launched
the Digital Transformation Acceleration Programme (DTAP) to provide Malaysian companies a
structured approach to digital transformation, so that they can future-proof
their business and stay competitive. Companies in manufacturing as well as
services sector can tap on the programme.
It will leverage on Digital Transformation Labs’ expertise
to help businesses adopt emerging digital technologies. DTLs are global experts
who are partnering with MDEC to help companies identify business pain points
using specific methodologies to brainstorm on new ideas, design new business
model, develop new product and/or technology design and finally pilot the
The experts for this programme will be from consultancy
firms, Deloitte, McKinsey and Roland Berger, along with a global
cooperative of entrepreneurs, called Rainmaking and German multinational engineering and electronics company, Bosch.
The Malaysian Investment Development Authority (MIDA) has been working with MDEC to
structure the DTAP for assisting Malaysian industry players in the priority
sectors in their digital adoption journey. MIDA has been facilitating the shift
of home-grown companies through the Domestic Investment Strategic Fund (DISF),
and it is now being expanded to cater for MDEC’s DTAP.
Established for large corporations and mid-tier companies,
DTAP is an outcome-driven programme which aims to help businesses achieve
increase in productivity, reduce dependency on foreign labour and create new business
models and sources of growth.
The programme consists of two phases. During the pilot
phase, the businesses will leverage on the expertise of the Digital
Transformation Labs to identify pain points and opportunities in the digital
space, uncover potential solution and implement proof of concept (POC)/minimum
viable product (MVP) with measurable outcomes.
Upon successful completion of the pilot phase within a
timeframe of 6 months to 1 year, businesses can apply for full-scale
DTAP is accompanied by an outcome-based matching grant, offered
through a partnership between MDEC and MIDA. The grant has the objective of
assisting companies to leverage on digital transformation lab’s expertise and
assistance in addressing pain points or exploiting opportunities in the digital
space, while adopting emerging digital technologies. The companies will be
reimbursed through the grant based on the outcome achieved.
Companies embarking on digital transformation may be
eligible to claim tax
deductions on certain expenditures as provided in Income Tax Act 1967 [ITA]
and its subsidiary legislations. For instance, companies can claim Capital
Allowance with initial allowance of 20% and annual allowance of 20% on purchase
of ICT equipment and software and development of customised software comprising
of consultation fee, licensing fee and incidental fee related to software
development. Capital Allowance is available with effect from YA (Year of
Assessment) 2017 for purchase of ICT equipment and software, while for customized
software, it is available from YA 2018.
“We hope that these efforts will continue to get the support
from the industries and in the long run, we will have more capable Malaysian
champions to penetrate the global market,” said Dato’ Azman Mahmud, Chief Executive Officer at Malaysian Investment
Development Authority (MIDA).
“Digital disruption is inevitable; it is the way of the
world now. It is imperative for businesses to embrace the changes that come
with digital innovation. To stay competitive, Malaysian companies must rapidly
adapt to the way technology is changing the rules of business and increasing
efficiency. Homegrown businesses – like Top Glove and Gamuda Land – have
successfully integrated digital technologies to their business processes. Now,
that move has yielded positive results. However, the digital transformation
journey is not an easy road. That realisation has inspired the establishment of
DTAP. Through this programme, Malaysian businesses will receive support, guidance
and be part of an ecosystem that will provide a structured approach to the
transformation into the digital world,” said Datuk Yasmin Mahmood, Chief Executive Officer at MDEC.
“The goal is to help Malaysian companies become world class
entities, and the best way to achieve that is by connecting them with global
Digital Transformation Labs. With these global connections, we are able to give
companies the global exposure that they need,” added Datuk Yasmin Mahmud.