While Malaysia's tech services market is mature compared with other fast growing ASEAN markets like Indonesia, it remains very fragmented. Some vendors also tout capabilities in technology services that fall outside of their core competencies and for which they have not yet developed a strong track record. The fast-rising digital expectations of business stakeholders are making it increasingly difficult for client organizations to find the right partner for their requirements. In a new report, my colleague Zhi Ying Ng and I provide a detailed analysis of the leading consulting and technology service providers in Malaysia. Here are a few high-level recommendations when choosing a service provider in Malaysia:
- Reset your expectations when engaging with local service providers. Organizations looking to expand in Malaysia will find it beneficial to tap into these providers' local knowledge and experience. However, companies looking for sophisticated skills — like those related to enterprise applications — should be aware that providers might lack experience even though they claim otherwise. As such, it is crucial that enterprises set a clear strategy based on the goals and objectives that they want to achieve, together with a road map that aligns services sourcing with internal capabilities before beginning such engagements.
- Put Japanese service providers on your shortlist for SAP services. Strong SAP capabilities are few and far between in Malaysia. Clients often complain that local service providers lack advanced SAP capabilities and find it a challenge to deliver their desired outcomes. Organizations looking to expand their SAP environments can also consider Japanese service providers (including Abeam and NTT Data), as they have a proven track record in SAP consulting, implementation, and management services in Malaysia.
- Carefully consider local team capabilities when working with a global service provider. Working with a reputable global service provider does not necessarily guarantee that the objectives of your technology project will be met. Although global service providers have the required experience and expertise, it is important to evaluate the on-the-ground resources that you will have access to during the project. Many of these providers leverage a mix of local and offshore resources to provide the expertise needed — and these offshore resources rarely meet A-team standards.
- Look at leveraging Indian service providers and their capabilities. Although they are considered late in the game when it comes to setting up shop in Malaysia, Indian service providers are growing their presence aggressively, particularly in ramping up their onshore resources. Malaysia is no longer seen purely as a delivery center for these providers' global clients. Most large Indian providers now see Malaysia as a promising market in which they intend to invest for the long haul. Organizations should consider leveraging these providers as a way to counterbalance the global and local service providers in their sourcing mix.
Picking the right service provider is key to augment your chances of success for your technology projects. We look forward to hearing about your experiences working with these different categories of service providers!