IR4.0: Closing the digital gaps

With the ongoing evolution in technology and its impact on industries worldwide, the focus on Malaysia's progression within the realms of Industrial Revolution 4.0 (IR4.0) remains crucial.

Over the years, Malaysia has embraced the IR4.0 concept, aiming to leverage cutting-edge technologies like blockchain, big data analytics and artificial intelligence (AI) to stay competitive in the global market. However, amidst these endeavours, certain challenges persist, hindering Malaysia's seamless integration into this digital revolution.

The National Fourth Industrial Revolution (4IR) policy, established to chart Malaysia's course toward digital transformation, underscores the significance of sectors such as smart manufacturing, digitalisation and talent development.

Under the stewardship of Malaysia’s Eighth Prime Minister, Tan Sri Muhyiddin Yassin, the policy played a pivotal role in steering the country's socioeconomic transformation by harnessing innovation and ethical utilisation of 4IR technology.

Supported by the Malaysian Digital Economy Blueprint, the intention of the national 4IR policy is all about bringing changes that will make businesses and society interact better, more intelligently and smoothly while preserving the environment and guiding society towards a better future and well-being in tandem with the National Policy on Science, Technology, and Innovation (DSTIN) and Twelfth Malaysia Plan (RMKe-12).

Yet, the implementation of Industry 4.0 principles across the business landscape remains an arduous task, primarily due to knowledge gaps and cost-related hurdles. Malaysia's aspiration to stand shoulder-to-shoulder with global industrial giants like Singapore and China is definitely filled with immense challenges.

Despite initiatives like the National Policy on Industry 4.0 (Industry4RWD), aimed at bolstering Malaysia's Industry 4.0 trajectory, there exist ambiguities stemming from lack of understanding and requisite digital infrastructure and insufficient practices related to the developments.

Reports from the Institute of IR4.0, Universiti Kebangsaan Malaysia, suggest that Malaysia's readiness and maturity in implementing Industry 4.0 stands at an average level, underscoring the gap in meeting the necessary standards. A study by Universiti Tun Hussein Onn Malaysia (UTHM), meanwhile, reveals that major companies are hesitant to participate in Industry 4.0 mainly due to excessive expenses of investment required that might exceed their corporate growth projections, and ultimately lead to financial deficiencies.

These findings illustrate the need for clarity over financial gains and knowledge. Hence, the government should play its outmost role in providing the necessary assistance. Moreover, the aftermath of the Covid-19 pandemic has left Malaysia in a stagnant phase of recovery, thereby, necessitating a renewed emphasis on digital infrastructure development and widespread awareness of Industry 4.0's potential.

Government support is imperative because many businesses, particularly those small- and medium-sized entrepreneurs (SMEs), are striving to rebuild and fortify their economic standing.

While commendable efforts have been made through various incentives introduced by Muhyiddin, concerted attention towards sustaining and bolstering the business landscape is crucial for the present government to do in order to enhance competitiveness, especially among SMEs. Lack of talent, regulation, economies of scale and technological innovation are some of the challenges facing SMEs.

There is a shortage of people skilled in science, technology, engineering and Mathematics (STEM) and insufficient focus on digital literacy and innovation has resulted in a workforce that is less adaptable to fast-evolving technology. The problem of brain drain due to unsatisfactory wages and other factors has also reduced Malaysia’s competitiveness in high-tech and high-value industrial production.

As the world progresses into Industry 5.0, Malaysia stands at a pivotal juncture. Addressing those existing gaps in technological acceptance, financial resources and skills are of paramount importance in propelling the nation into the next industrial phase.

Initiatives by the government must focus on coordinating efforts to promote new technologies, with emphasis on potential competitive advantages for businesses for both national and international competitors.

Indeed, the journey towards Industry 4.0 integration remains very challenging and arduous but Malaysia has been making steady progress while preparing for IR5.0.

There are still outstanding gaps in the availability and reliability of internet connectivity and digital services in some parts of the country, particularly in suburban areas. While IR4.0 focuses on the integration of advanced technologies, IR5.0 emphasises the importance of human collaboration with these technologies.

Concerted efforts, therefore, need to be made to address existing obstacles. First and foremost, the government must put all the pieces together – overcoming political and economic uncertainties, containing the rising costs, and building a vast pool of reliable workforce and talent that can meet the requirements of industry players.

It should introduce, among others, more strategic moves and programmes to facilitate the expansion or establishment of large local companies and mid-tier companies. They need to be empowered in IR4.0 to remain competitive and keep pace with the ever-evolving industries.

Much work remains ahead but a more focused commitment and strong political will, hopefully, will enable Malaysia to position itself favourably in the evolving landscape of global industries.

Muhammad Fadzil Anif

Institut Masa Depan Malaysia (Masa) strategic communications and management executive