KellyOCG’s Response to Malaysia’s Brain Drain Issue

April 6, 201611:25 am1173 views

Focusing on the dire state of Malaysia’s perennial brain drain issue, ASEAN Today recently published a piece.

In response to the same, Anthony Raja Devadoss, Vice President Asia Pacific, Kelly Outsourcing and Consulting Group comments that, “The article hits the nation’s brain drain issue right on its head, and accurately depicts the alarming state of the deteriorating state of continual HR talent losses from this market.”

While the Malaysian government is making considerable efforts to address this, corporations and organizations (Private and Public sector, MNCs and SMEs) need to see the urgency of acting in their own capacity to help themselves – since business productivity and sustainability cannot rely on expecting this massive problem being resolved by the government anytime soon.

So what can employers do? What actions do corporations take to resolve the issue of insufficient HR talent and resources? They need to prioritize having a Talent Supply Chain Management (SCM) strategy today and if you already have one, ramp-up the effort to activate it.

Basically, corporations need to change their ways of managing their talent resources. They need to accept the brain drain issue is not going away for the next few years at least; so plan to move away from the traditional way of employment to a robust talent engagement framework.

Some of the key points highlighted in the article published by ASEAN Today are:

  • 26% of Malaysians who have US$30 million of investable assets are planning to migrate within the next 10 years. This is much higher than the average rate of 16% in the region.
  • Economic reasons are the main push, with 84% of Malaysian jobseekers are willing to pack up and leave for an overseas job just so that their lives would be better.
  • World Bank study showed that 72% of those Malaysians who have migrated do so for better career opportunities.
  • In 2015, there were 2,206 Employees Provident Fund (EPF) withdrawals by Malaysians leaving the country, as compared to 1,787 in 2014.
  • As of 2011, about one million Malaysians are overseas – a substantial number considering that the population of Malaysia is about 30 million.
  • 2 out of 10 Malaysian professionals eventually leave the country.
  • The poor economic climate is the main reason, with over 6,500 employees from 114 companies who have been laid off. About 78% of them are from the finance and insurance sectors.
  • Malaysia’s shortage in talent will drive more MNCs – which set up business in Malaysia in the earlier 5 years, to move away to set up facilities and invest in neighbouring ASEAN markets including Philippines, Vietnam and Thailand.

There are many ways to do this, but KellyOCG’s key advocacy now is to reshape your workforce to adopt the Free Agent Workstyle trend – a movement that is already hitting the US, Europe and many Asian regions.

KellyOCG believes that Malaysia’s fundamental workforce and talent, is highly adaptable to this Free Agent model, especially in the Gen Y and Gen Z pool of mid-20s to early 40s employees. Adopting a ‘Free Agent’ model as part of the company’s Talent Supply Chain Management (SCM) strategy fits well to an overall flexible and varied approach to sourcing workers for the company.

The non-traditional way of filling up the need for a workable workforce in a company, besides full time employees, may involve

  1. Temporary Staff
  2. Independent Contractors / Freelancers
  3. Service Providers
  4. Alumni, Retirees & Interns

These could make up for a more fortified Talent Supply Chain Management (SCM) Strategy.

In short internally, there are numerous ways and action points that corporations and organizations can take to do something about the impact of Malaysia’s brain drain problem on their talent and HR requirements – these include talent optimization, good succession planning, building employee competencies, managing transitions and much more.

But immediately and most fundamentally, it is important to first work at a Non-Traditional Talent Supply Chain Management (SCM) Strategy that incorporates the free agent workstyle trend that we believe, will work quite well in Malaysia’s corporate culture.

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