YCM CEO Series 42: Tengku Farith Ritahuddeen, CEO and Co-Founder of SKALI
Dear YCM Members,
For the YCM CEO Series 42, we have the privilege of hosting Tengku Farith Rithauddeen is the Group CEO and Co-Founder of SKALI.
Writing Credits: Jason Tan Jing Shen, YCM Convenor 2012
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Date: Tuesday, 10th July 2012
Time: 8.00pm -10.00pm
Dress Code: Your work attire
Venue: Intercontinental Hotel KL (formerly Nikko Hotel),Jalan Ampang, Kuala Lumpur
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Tengku Farith Rithauddeen is the Group CEO and Co-Founder of SKALI.
Prior to joining SKALI as its President, Farith led a team to turn around a local manufacturing company involved in the building materials industry. In his four-year stint as CEO of this company, he earned valuable experience in managing the day-to-day and hands-on operations of two factories employing 160 employees.
At SKALI, he is also instrumental in the establishment of SKALI’s new division and program called SNAP or SKALI Netpreneurs Acceleration Program. SNAP is an initiative for Asian Netpreneurs to leverage the pool of SKALI’s experience, expertise, resources and business networking. SNAP creates and adds further value for investors, Netpreneurs and communities in general by sharing an in-depth knowledge base and widening the reach of Internet opportunities.
In 2002, Farith was selected as one of the 100 Global Leaders for Tomorrow (GLT) by the World Economic Forum, Davos of Switzerland. In 2004, he was the first recipient of the Young Entrepreneur award by the Malay Chamber of Commerce, Malaysia and in 2006 was awarded the prestigious Eisenhower Fellowship for 2007 by the Eisenhower Foundation, USA.
Farith was the President of TeAM, Technopreneurs Association of Malaysia from 2004 to 2007. TeAM has been formed by a group of Malaysia Technopreneurs and to assist in the development of the Digital Economy in Malaysia.
He is also a co-founder and current advisor of the New Entrepreneur Forum (NEF) which among other established to promote the development of Bumiputera ICT entrepreneurs or Technopreneurs. He sits on other advisory boards both in the public and private sectors which focus mainly on Industry and Netpreneur development in Malaysia.
Farith obtained his Bachelor of Arts in Economics from Carleton University in Ottawa, Canada in 1992.
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The YCM Series 42 opened with a welcome address and introduction of the speaker’s background by Ms. Farisya Shukor the Master of Ceremony, followed by a brief introduction of YCM by Director Dimishtra Sittampalam. The MC then invited the speaker, Tengku Farith Ritahuddeen, CEO and Co-Founder of SKALI to deliver his presentation.
Tengku Farith started by conducting a very brief background check of the audiences and expressed his hope that the audiences will go home with substance after hearing his presentation.
“How will the future be like”?
He started his presentation by showing a slide featuring the world’s most innovative companies in year 2011 and highlighted that the ranking of companies has changed in just a matter of 12 months since year 2010. He continued by saying that this imply that competition is intense and will continue to be highly intense. Malaysia will be extremely challenged within the ASEAN countries and by China, and also by the deterioration of income of the traditional markets (i.e. US and Europe) which we sell our goods to. He emphasized that this will consequently impact the level of our personal income. He raised the question, “How do we become a high income nation when the countries that we are selling to can’t really afford our goods anymore?”. In addition to that, he stressed that what used to be the core competencies of Malaysia is no longer competitive as other countries can deliver the same services/products in a more efficient and cost effective manner. His observations of the efficiency of other countries make him worry about whether Malaysia will be able to achieve its goal of becoming a high income nation. He highlighted that developing new generation of leaders that can compete globally is the key to achieve the goal. Malaysians are in the comfort zone and we will be challenged by our way of life. Through his interactions with the youths in other ASEAN countries, he thinks that the Malaysian youths are not hungry enough for success; a shock in the system is needed to wake us up.
“Where’s Malaysia’s wealth?”
56% of Malaysia’s GDP comes from services, 28% comes from manufacturing, and 7% comes from agriculture. These three industries are facing tough industry specific challenges due to the challenges post by the change in the global economy. The government has been pumping money into the economy to make sure things stay afloat, however, this is not a sustainable solution.
“Should we be worry? What do we need?”
Looking at the current scenario, he thinks that Malaysians should be worry and we have reached a point where we need to ask ourselves where we need to go from here. Malaysia fell into the middle income trap where we are stuck in between, we can’t compete based on cost advantage and we are yet to be able to become a highly innovation driven country.
He believes that the right and positive attitude is what the country needs. He shared his experiences on interviewing young people and highlighted that he realized people nowadays switched job/choose a job because of higher pay. He emphasized that one must focus on value creation and make sure that he/she is worth the value that are being paid before asking for a higher salary. To further elaborate his point on the importance of attitude, Tengku Farith shared the experience of SKALI with the audiences. The first big customer of SKALI, Bank Nagara Malaysia subscribed to SKALI at a subscription fee of RM 38 per month for a simple hosting service at the very beginning and SKALI’s sales people had to travel to Bank Negara’s offices several times to provide services. In addition to that, the cost of parking that time was RM 6 an hour, hence, it was obvious that the deal was not a very profitable one for SKALI. However, with a highly positive attitude, SKALI still delivered excellent services to Bank Negara. As a result, Bank Negara was happy with SKALI’s services and after 3 or 4 months, they switched the hosting of their entire main website to SEKALI’s data center where SKALI could charge a higher fee. Eventually, SKALI managed to secure contract worth millions of ringgits with Bank Negara. He said if SKALI was dealing with Bank Negara Malaysia with a lousy attitude at the beginning because of the low subscription fee, they would have lost this important customer. Using this story as an example, he once again stressed the importance of value creation before one ask for money from customers/ before one ask for increase in pay from his/her employer.
“Escaping the comfort zone!”
He advised the young people to push themselves, challenge their own boundaries and escape the comfort zone. He believes one will never know what he/she can achieve if he/she don’t stretch and challenge him/herself. He asked if the young have the courage to challenge themselves and strive for their dream. He started SKALI not because he was being forced. He started the company because he was tired with his old job and could not see the value on the things he was doing in his job. With the aim to have a more fulfilling career and to leverage on the rise of IT industry at that time, Tengku Farith left his job which pay him good salary and started SKALI with no knowledge about IT. He managed most of the word processing of SKALI during its early days using the typing skills he acquired from his old job. He was not afraid of doing new things. He thinks that young people nowadays are scared of failure and are not versatile enough. He said, in SKALI, staffs who have taken the extra step to learn new things (i.e. sales, programming) are probably management leaders now because of the versatility that they have demonstrated. Failure is a process, we have to fail to learn and we must not be afraid to fail and make mistakes.
“What is your value? Do you know it? Where Will we be?”
Tengku Farith believes that understanding one’s own value will allow one to understand his/her competitive edge. He shared his experiences of travelling to Vietnam for work and how these experiences made him realized how highly competitive the people and companies in Vietnam are. He highlighted the point that some countries which were the top economies in ASEAN during 1940s have fallen behind Malaysia. He asked where Malaysia will be in the next 20 years if we do not react and change now looking at the current progress and development of other countries in ASEAN.
What do we have?
He believes Malaysia has a relatively stable government, versatile and open community, big savings and relatively good infrastructure. We must realize about the values and advantages that we have and make sure we fully utilize them.
Closing
To close his presentation, he emphasized again that Malaysia is at a very critical period, things are going to be increasingly challenging. We have a lot of qualities and advantages that we have to realize. We have neighboring countries that need our expertise, our knowledge, our experience, and the lessons that we learnt from our mistakes. We must go there to create and share our values for them, because if we don’t, other countries will. We have lost lots of opportunities because we were too slow. He encouraged everyone to not to be scared, instead we must go out to the neighboring countries to build network and gain experiences.
Q&A
1) What is SKALI?
SKALI help organization to use the web more effectively. It buillds solutions for organizations, so that they can manage their processes more efficiently, increase their revenues, and decrease their cost of operations. SKALI believe in open source technology, it has the platform and infrastructure for organizations to build their web based solutions and it has also recently introduced the “cloud” which is growing very fast for the company.
2) How did SKALI procure government’s contract during its startup stage?
SKALI did not get its’ first business from the government. Instead, it was a search engine portal. It ran “AltaVista” for Asia, the world’s most popular search engine before the emergence of Yahoo and Google. Examples of SKALI’s clients were Intel and Motorola. During that time, there was no content management system to run portals. SKALI went to companies like Microsoft and IBM to buy a content management system, but the quotation given by Microsoft and IBM that time was RM 20 million and RM 4 million respectively. The cheapest CMS that they could find was RM 4 million. Tengku Farith met two entrepreneurs, who had the skill to produce a CMS platform. He proposed a 50-50 profit sharing mechanism where SKALI would do the marketing and the two entrepreneurs would develop the CMS platform. The deal was sealed very quickly as it was mutually beneficial for both parties. There was tender by EPF, during that time, EPF’s the counters were always flooded with people who were there to settle small matters (e.g. checking for status updates). EPF was looking for an online platform to allow people to check and update their EPS status and records. SKALI submitted their proposal for the tender and was shortlisted. The price that SKALI quoted was around RM4 million and their closest competitor was RM28 million. However, the government was not very convinced and requested SKALI to develop the platform for them first before paying them. If they are satisfy with the platform, they will pay for it, otherwise, no money will be paid. SKALI agreed to the request and eventually managed to secure the contract due to the value it was able to create for the government at a very low cost.
3) Could you give us a brief overview of the IT industry?
The IT industry changes all the time. For instance, SKALI once experienced investing in a technology and that technology became absolute after one year. Being in the IT industry, it is important to be ready to change all the time, catch the next big wave, must and leverage on the infrastructure of the ASEAN countries.
4) How much the government should be involved in businesses?
Tengku Farith believes in government sector and initiatives in stimulating the economy and developing industries. For instance, he supports and believes in government’s provision of training for graduates and Human Resource Development Funds to develop talents. However, he admitted that there are certain times where the government’s involvement created competition for the local companies. There were cases of competition between the government and local companies in terms of man power. SKALI has lost some talents to GLCs. Hence, he thinks sometimes too much government involvement would diminish the competitive strengths of local companies. He thinks government needs to know when and when not to intervene, so that the local companies will not be negatively impacted.
5) How to innovate?
Innovation is not something fancy, it is not rocket science. He used the example of how a burger seller in Ampang managed to achieve success by just doing some simple innovation. He believes innovation is simple; it’s all about creating value for customers. For SKALI, it was simple, it took open source technology to eliminate the cost from getting licensing, and charged its customers services fees for providing the solutions. This strategy allows SKALI to give its customers world class and price competitive solutions.
6) How did you lead the business from a start up from what it was to what it is today? What is required? What did you do?
Work backwards and begin with the end in mind. Think about how to create and add values for the customers. He recalled when SKALI’s customers’ websites were attacked by hackers, they hired extra security team to look after their customers’ website without paying much attention on how much this would cost them. They just want to make sure that their customers are happy. He advised the audiences not to focus on money, not to just focus on thinking about how to make billions of dollars, but think about one customer at a time, and think about how to create values for the customers.
7) Experience of travelling to other countries? How fast would the rising ASEAN countries catch up with Malaysia?
Malaysia has the competitive advantage over other ASEAN countries in terms of organization structure and culture. Some of the export oriented companies in ASEAN companies are very dynamic and versatile. Countries like Indonesia, Vietnam, and Thailand has massive domestic market which allows them to generate huge amount of revenues by marketing and selling their products to the local people. If an organization is complacent, there will not be innovation. Right amount of competition can create innovation. At SKALI, competitions from giants such as Microsoft and IBM keeps Tengku Fariths awake every night to think about strategies to win the competition and forced him to be innovative.
8 ) How can we help Malaysians to move up the value chain to increase their competency? What should we do to motivate our people to rise up to that level?
Tengku Farith believes talent development starts from teaching children. Most universities today teach students by memorization and spoonfeeding. Instead of spoon-feeding, he believes the journey to find information is the best learning experience for students. To develop talents, we need to change how we educate our future generation. On the organization level, he realized some companies are rewarding all their staffs without considering the discrepancies in performance among the staffs. Reward based on performance is the key in motivating talents. Don’t reward wrong behaviors because it would demotivate the good performers.
9) Advice for technopreneurs?
Specialize and stay focus, entrepreneur tends to get excited for lots of things. For instance, SKALI lost focus several times and went off tangent to build some other things. His advice for entrepreneurs is to stay focus and make sure they specialize and be the best in whatever they are doing.
The wonderful night finished with the presentation of token of appreciation by Tengku Nor Azah.
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. YCM CEO Series 38: Shahrol Azral Halmi, CEO of 1Malaysia Development Berhad (1MDB)
For our YCM CEO Series 38, we have the privilege of hosting Shahrol Azral Halmi, the CEO of 1Malaysia Development Berhad (1MDB).
CEO of 1Malaysia Development Berhad (1MDB)
Wednesday, 8h February 2012
Intercontinental Hotel Kuala Lumpur
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About the speaker Shahrol is an expert in value creation in multiple sectors. He was instrumental in growing Accenture Malaysia’s public service practice, helping government agencies to add value in their services to the people and businesses.Shahrol has over 13 years of experience in IT Transformation, IT Integration, Service Oriented Architecture and complex system implementations involving large government-linked entities, government agencies as well as local, regional and global financial institutions. Shahrol joined Accenture in 1995 and built his career in business consulting through projects in various industries such as Government, Financial Services and Oil & Gas. He has led key projects in Malaysia, including a multi-year transformation programme at the Employees Provident Fund as well as planning and executing the merger of Sime Darby, Guthrie and Golden Hope to form Synergy Drive, the world’s biggest plantation company. Prior to joining 1MDB, Shahrol was the Executive Partner of Accenture and Managing Director of the Public Service Group of Accenture Malaysia Sdn Bhd. Shahrol graduated from Stanford University in the United States of America.
3rd Annual Young Corporate Summit “China & India The Next Frontier”
Young Corporate Malaysians (YCM)
K3 Taman Tunku, Bukit Tunku 50480 Kuala Lumpur
www.ycm.org.my
THE 3rd ANNUAL YOUNG CORPORATE MALAYSIANS (YCM) SUMMIT
Saturday 17th December 2011 Intercontinental Hotel, Kuala Lumpur
PROGRAMME
DATE: SATURDAY, 17th DECEMBER
8.00 am Registration of participants
9.00 am Start of event
9.05 am Welcoming note by Chairman of Young Corporate Malaysians
9.10 am Opening Keynote speech by YBhg Datuk Rohana Mahmood
(Chairman, Kuala Lumpur Business Club)
10.00 am Session 1 on China by Hugo Restall (Editor of Wall Street Journal
Hong Kong) and Jude Blanchette (Beijing Representative, Atlas Foundation)
11.30 am Session 2 on India by Nechal Khanna (Managing Director, Morgan
Stanley Singapore) and Mohit Satyanand (Chairman, Liberty Institute New Delhi)
1.00 pm Lunch and Zuhur break
2.00 pm Session 3 on Scomi’s Mumbai Monorail Experience by En Shah
Hakim Zain (CEO of Scomi Group) and En Kanesan Vellupillai (Scomi India)
3.00 pm Session 4 on Proton’s Experience in China and India by Dato Seri
Syed Zainal Abidin Bin Syed Mohd Tahir (Managing Director of Proton Berhad)
4.00 pm Closing Keynote Speech by Dato Seri Johan Raslan (Executive
Chairman of PricewaterhouseCoopers Malaysia)
5.00 pm End of Summit
YCM CEO Series 37: Pn Hamidah Naziadin, Head of Group Corporate Resources for CIMB Group
YCM CEO Series 37 Pn Hamidah Naziadin, Head of Group Corporate Resources for CIMB Group
CIMB Group
Friday, 2nd December 2011
Intercontinental Hotel Kuala Lumpur
YCM CEO Series 36: Mohd Khairil Kevin, Partner Bain & Company
YCM CEO Series 36 Mohd Khairil Kevin Partner, Bain & Company
Partner, Bain & Company
Wednesday, 2nd November 2011
Intercontinental Hotel Kuala Lumpur
YCM CEO SPECIAL SERIES Great Ladies@Work Chin Suit Fang, Senior Executive Director, PricewaterhouseCoopers(PwC)
YCM CEO Series 35 Chin Suit Fang
Senior Executive Director, PricewaterhouseCoppers (PwC)
Wednesday, 5th October 2011
Intercontinental Hotel Kuala Lumpur
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An evening with the Prime Minister
An evening with the Prime Minister Date:Monday, 27th June 2011 Time: 8.00pm – 9.30pm Dress Code: Your work attire Venue: Intercontinental Hotel (formerly Nikko), Jalan Ampang, Kuala Lumpur
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