|kev| the @rtistic me's Blurty

Subject:	Doing IT business in Malaysia
Time:	10:55 pm.

This was an article I read from TheEdge. Sad but very true. Will be interesting for you guys who are in the IT business like me. Yes I have been long gone. busy. haha.

Anyway enjoy.

Taken from The Edge:
I have been covering technology and entrepreneurship for eight years now and it has taken me this long to figure out why I have not been able to celebrate the world-class or even Asia-class success of any Malaysian technology company. Our Money & Entrepreneurship columnist Dr V Sivapalan has some interesting views on the issue too, which he expounds on in his article "State of the country", which we will carry in our next publication on Jan 14.

But for me, the core problem is corruption on an unholy scale in public sector IT procurement and rising corruption in private sector IT deals. "It is actually getting worse and I am frankly appalled at the scenario," states the CEO of an IT company that has revenue in excess of RM15 million a year and reckons he could easily double this if not for the way the "game is played".
Meanwhile, a senior executive at an MNC that ranks as one of the three largest in the world admits that over 70% of the deals he has been involved in have been dirty. Typically, MNCs, which have strict rules about kick-backs, let their partners do all the dirty work when greed, self-interest and corruption get in the way of closing a sale.
In fact, the CEO of a leading tech MNC told me once that his company would walk away from any deal that was shady. Yet, sometime this year, the CEO, when presiding over a sales update meeting with quarterly numbers to be met looming, told his team in no uncertain words: "We need this deal." He was responding to a deal that was not closed because the buyer wanted a kickback. Says an executive who was in the room: "He knew what it meant when he said that."
Tengku Farith Rithauddeen, group CEO and co-founder of Skali, also knew what it meant when he said local companies cannot compete against the "marketing budgets" of MNCs.

But while we at netv@lue2.0 have always been hearing about such deals, it is with the looming World Congress In Information Society to be held in KL in May that I have come to realise the body blow that corruption deals to the country's aspirations of being a leading ICT player and to entrepreneurs' dreams of building a great IT company.
In 2003, when we wrote about Malaysia winning the right to host this prestigious event in 2008, we also said that it should add a sense of urgency to efforts to develop the industry as we would want to proudly showcase at least one or two companies that have become world-class. It pains me that we are nowhere near that goal.
And it pains me even more that Malaysians are afraid to highlight companies that have little or no capability and yet can win deals worth hundreds of millions from the government.

In fact, when I spoke to the press secretary of a senior minister about these deals and mentioned one company in particular, the press secretary did not want to speak over the phone about it. The CEO of a leading bumiputera ICT company also declined to talk unless it was face to face. The reason is that the company in question, Precision Portal Sdn Bhd (PP), is said to be promoted by influential political personalities Khairy Jamaluddin, Datuk Reezal Merican and Datuk Norza Zakaria. However, both Khairy and Reezal have denied any association with PP (I did not get in touch with Norza).
Reezal says he only got to know Precision Portal's executive director Mohd Aminuddin Mustafa during their time at International Islamic University and that could be the reason why his name gets linked to PP every time it wins a government deal. Although Aminuddin replied to some questions we had about PP and how it managed to win large IT deals, questions remain, mainly about the RM1.2 billion eTanah deal. Even though Aminuddin says PP did not win the job, speculation still persists that the deal is linked to PP in some way.

I thus eagerly await an interview next month with Aminuddin and his new CEO, an ex-Mesiniaga executive, on the future of the company. To be sure, PP is not the only such company winning government IT deals. But I am highlighting them because of the personalities supposedly linked to them and I want to send a message to the tech industry that such companies are not to be feared but put under the spotlight because if they cannot build on the business given to them, they have betrayed the trust our government has placed in them. And billions of ringgit in ICT expenditure have gone down the drain, with no meaningful capability built by these companies nor any hope of going regional.

Something sure stinks in tech in Malaysia.

Comments: Read 3 orAdd Your Own.