YCM CEO Series 40: Nor Azah Razali, MD The Boston Consulting Group Kuala Lumpur
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For our milestone 40th CEO Series, we have the privilege of hosting Nor Azah Razali, the Managing Director of The Boston Consulting Group Kuala Lumpur ——————————————————————————————— ———————————————————————————————
About the Speaker BCG in Kuala Lumpur is one of four offices in Southeast Asia, and Kuala Lumpur-based consultants work on projects throughout the region. These consultants gain exposure to the breadth
of the region’s economy through hands-on experience with a diverse mix of clients.
Kuala Lumpur’s client base includes leading firms in consumer goods, energy, financial services, healthcare, media, technology, telecommunications, and utilities. The team supports assignments ranging from general strategy and market entry to organizational strategy and operational improvement. The client portfolio includes a mix of top local companies, state-owned enterprises, and multinational corporations. BCG in Kuala Lumpur has helped its clients put in place structural changes that have played a key role in the development of the Malaysian economy YCM CEO Series 40 ft Nor Azah Razali, Managing Partner of The Boston Consulting Group Kuala Lumpur Writing credits: Aimran Hamid This is a live blogging of the YCM CEO Series 40. For full details, please view our event video. The presentation was titled: “BCG 2012 Southeast Asia Challengers: Companies Piloting a Soaring Region”. A version of the presentation may be found here (insert link: https://www.bcgperspectives.com/content/articles/globalization_growth_companies_piloting_soaring_region_2012_southeast_asia_challengers/) - The speaker starts by introducing herself. - A lot of the work is mainly with public sector and the government of Malaysia mainly on financial backgrounds. - Focus on her topic and stressed on the South East Asia especially on the potential of the region. - Reminded on the economic crises in 97 - Shows on what BCG done. Came up with the report every year since 2006. Last year done report mainly on South East Asia. - Show’s comparison of SEA with China, India, Brazil and Russia. - It shows if the SEA was a country it could be at par with the rest of the countries. - Shows comparison in terms of GDP, percentage of population etc. - Shows that in 2015, 96 Million of people in ASEAN will be in the middle class with - household income of more than 5k USD per month. - 87% of palm oil from the region with 80% of rubber from the region as well. - Also shows the competitiveness of the labour pool in ASEAN. - Eg; call centres in Philippines generates revenue of USD 6 B per year. - Government taking lots of incentives to reduce the tariffs and duty with the SEA region. - Starts to see companies that became emerging challengers. - When talking on Europe, the economic crisis is what all the investors talk about compared to what this region is offering. - Double digit growth for investors in SEA - Show’s some of the companies that will be a major players in few years time within the region in which majority are unknown at this point of time. - Majority of the companies are in consumer business. - Shows SEA challengers outperform global players in terms of growth and EBITDA numbers. As well as create significant shareholder value. - A lot of the companies become very strong due to mergers and acquisitions. 9% of increase in revenues in the last 10 years. - Common characteristics for the companies- Early advantages, Ambition, Strategy and business model as well as capability development. - The companies are broken into 4 groups. a) Monetizing SEA’s resource abundance in which majority of the companies fall in this b) Building regional dominance taking advantage on the growing middle class c) Growing with large RDE’s and companies in China n India. Very good understanding in the middle class markets as well as very flexible d) dominating global niches where they dominate in very specific market. - Shows 2 companies to give example: 1) Indorama from Thailand
2) Mayora from Indonesia.
- Talk on range of macro issues need to be addressed to improve growth in SEA. - Talent shortage, Infrastructure Bottlenecks, Lack of innovation, Political Instability and remaining trading barriers - She summarized by separating key items into 4 categories; for SEA challengers, for other SEA companies, for Multinational companies and for other governments. Q&A with Audience 1) 3 big aspects which is the economic, social and political. Will there be an ASEAN youth council in relation to the growth in economy in few years time. If there is no economic growth there will be a lot of tensions and uprising issues. Growth is there and which is very important to increase the growth of the next generation. She do not specifically is there any council for ASEAN youth but in fact a lot of other organisation other which represent the youth such as one in World Economic Forum 2) Personal experiences from the speaker that created impact on the colleagues Majority of the work is done with the private sector and the speakers do find that the work she does created an impact 3) Low bottle neck in Malaysia Actions is taken in Malaysia to overcome the bottleneck and the government is more supportive compared to other SEA countries 4) Position of Malaysia in the BCG Index Should be in the Star range. Have strong institution compared to other ASEAN countries. 5) If China’s economic slows down will it affect the SEA region Says that the economic might slow down but it won’t affect the growth and lead to low growth. Give example when she visited China and Peking University in which the people are very highly competitive so slow growth is not really expected. 6) Strategy to identify business and complete the work Come with hypothesis when coming into a business. Really focus in hypothesis and very focus and straight forward into the problem. Focusing on staying longer with the client and assisting the client in way that can be beneficial to the client. 7) Ways to close the gap between the differences between the countries in ASEAN Government plays a lot of role in closing the gap. Need to have a good understanding and adaptive and to response to the different markets. Need to have good mix of talents between local and foreign. It is at very early stage. Not much players in Malaysia. 9) Hurdles BCG came across when coming into Malaysian PLC’s A lot of the companies and they are variety of hurdles or resources that they have depending on the companies. The range is very broad. Talent is always an issue in majority of the companies. 10) What do you think on political risk and protectionism in the region that will affect the growth in the region? Opportunity is still there in the region despite the risk and the protectionism issues. A lot of strategies and plans that can be put up to cater the risk involved. 11) Juggling personal and work commitments. No time for friends. It’s not easy. But it’s not about the juggling but more towards the passion on what you do. 12) If the leverage stops will the growth stops. Malaysian bank have pretty strong balance sheets and pretty strong financial system. There is not such a huge risk and despite the leverage stops, she believes the growth won’t.
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Are there any opportunities in Malaysia in terms of social enterprise and how is the perspective of the Malaysian companies looking into social enterprise. 