JOHOR BAHRU, May 1 — Digitalisation and automation of micro, small and medium enterprises (MSMEs) have been identified as one of the five key focus areas in the Business Strategic Plan (BSP) 2022-2030 to accelerate the adoption of digital technology and improve productivity and operational efficiency.

SME Corporation Malaysia (SME Corp) chief executive officer Rizal Nainy said the initiative is important given that MSMEs still face major challenges in digitalisation efforts, specifically involving a combination of cost constraints and a lack of expertise among industry players.

He said cost is one of the biggest barriers, as the initial investment required for digitalisation is considered high and beyond the means of some MSMEs.

“MSMEs tend to view digitalisation as an additional expense rather than a strategic investment, especially when the return on investment (ROI) cannot be seen in the short term,” he told Bernama recently.

In addition, the lack of expertise is also a critical challenge, as there is a knowledge and digital skills gap among the workforce.

According to him, without sufficient skills, MSMEs find it difficult to implement technology-based projects such as information and communications technology (ICT), data analysis, and digital marketing, and also face difficulties in obtaining expert manpower compared to larger companies.

He said that in Johor, the level of MSME digitalisation shows positive development based on the 2023 Economic Census by the Department of Statistics Malaysia (DOSM), with computer usage reaching 97.6 per cent, Internet usage (97.3 per cent), and website usage at 79.0 per cent in 2022.

In terms of e-commerce, Rizal said a total of 4,460 MSMEs in the state carried out transactions in 2022, compared to 3,212 in 2015.

E-commerce revenue amounted to RM20.8 billion in 2022, with an average annual growth of 10.1 per cent, reflecting increased awareness of the importance of digitalisation among MSMEs, he said. — Bernama