Over 40% of large, micro, small and medium enterprises (MSMEs) are expecting business recovery beginning end 2022 to end 2024. This is according to a recent EY business pulse survey of over 500 companies.
Almost half of the large companies (46%) and one-third of MSMEs (33%) indicated they had adapted well (positive to very positive) to the Covid-19 pandemic. However, 25% of Malaysian companies had been adversely impacted (negative to very negative).
The EY survey also noted that the majority of Malaysian businesses were prepared to live with Covid-19 (86%) and were prioritising technology adoption in the immediate term (77%) as they fast-tracked their adaptation to the new normal. The movement restrictions in the wake of the pandemic had accelerated the companies’ adoption of technology and their transition to a digitally-enabled work environment.
In contrast, the respondents experienced more negative impact in the financial (44% of large companies; 63% of MSMEs) and supply chain (54% of large companies; 44% of MSMEs) areas.
In the short term, 85% of the respondents were prioritising the improvement of employee safety and the implementation of standard operating procedures (SOPs) including flexible work arrangements, while 77% were focused on enhancing digitalisation to facilitate contactless information technology or IT infrastructure.
Moving forward, the key business priorities will be on re-skilling people (74%) and adopting digitalisation (74%).
At the same time, a higher proportion of MSMEs were paying greater attention to readapting the business size, changing the business model or entering new business ventures (58%) and improving their financial position (48%). Also, the survey respondents indicated that they required further support in upgrading digital technology (51%), adapting the business to be more resilient (47%), accessing resources for business recovery (42%) and redesigning physical premises (40%), to help them better prepare to live with Covid-19.
Beyond the recovery and improvement phase, the respondents indicated that they needed guidance in finding new markets (58%), forging new partnerships (54%), accessing digital skillsets and talent (53%) and developing new business models, products and services (53%).
The upshot is recovery to 2019 level will take up to two years from end 2022. The Government needs to re-calibrate support packages and economic measures for companies to survive in the next 24 months or so. Meanwhile, companies will need to redesign business model, innovate and re-skill employees and pray for the best!
Reference:
Large proportion of firms expecting recovery, The Star, 24 March 2022
(https://www.thestar.com.my)
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