The Government Business Support Services in Malaysia: The Evolution and Challenges in the New Economic Model

Abstract

Over the years, the government business support services (GBSS) have worked closely along the government<br />policies and experienced a number of transformations to suit the current needs of the SMEs and business<br />environment. In order to understand the philosophy and the very nature of the GBSS in the present context it is<br />paramount to study the development of the services in the country over time. Hence this paper explores the<br />evolution of the GBSS, starting from prior independence period to the New Economic Policy era and in the<br />contemporary period. The study shows the government business involvement formerly started a few years back<br />before the independence. A humble beginning with the objectives to bring close ties between the rural folks and<br />the government had acted as a stepping stone to the glorious achievement of the GBSS. The quantum leap begun<br />in the NEP era as the current government had recognised the roles of entrepreneurship as a catalyst to the social<br />restructuring process. While understanding the evolution of the GBSS provides a background of the study, it is<br />paramount important to look at the challenges faced by GBSS in current situation. The new economic model<br />which was launched by the Prime Minister recently is aimed at moving the country towards high income<br />economy in ten years times. Coherently, the move is a big challenge to the GBSS as to better equip the<br />Malaysian SMEs with innovation, creativity and value-added activities. An important question is, do they ready<br />for the big game? The present paper is structured according to the following lines. First, a brief reviews the<br />establishment, roles and present functions of the GBSSs’ main players namely Majlis Amanah Rakyat (People<br />Council of Trust), SME Bank, GCG, SME Corporation and National SMEs Development Council. Second,<br />discusses the current issues and challenges that need to be addressed by the GBSS, and lastly discusses and<br />suggests viable strategies should be taken by the GBSS to remain relevant and successfully contribute to the new<br />economic model

Islamic Banking Implementation: Supportive Role of Business Service

“…Lin and Bennett (2014) have stated in this context that the customer's experiences may be a significant factor influencing their consummation and allegiance. Customers who have experienced better satisfaction with an organisation's (banks services in this research) products or services will tend to use that service or product again (Yusoff & Yaacob 2010). Five dimensions of service quality viz., tangibility (equipment, appearance of physical facilities, personnel and written materials), reliability (capacity to dependably and accurately perform the promised Islamic banking service), responsiveness (willingness to provide prompt Islamic banking service and assist customers), assurance (the employee's Islamic banking knowledge and courtesy as well as their ability to inspire confidence and trust on Islamic banking) and empathy (the individual attention and care that the firm gives its Islamic banking customers) have effect on adoption of services or products (Zeithaml & Bitner 1996;.…”

“…Past researches report that the business service support has a direct and positive relationship with the intent to adopt Islamic banking among SME business entrepreneurs (Lin & Bennett 2014;Yusoff & Yaacob 2010;Fombrun 1996). Better the banking services, higher will be the intent to adopt Islamic finance among SME industry entrepreneurs.…”

“…Jaffar and Musa (2013) also indicated that the business supports provided by Islamic financial institutions and agencies can affect the attitude of businesses towards their intent to adopt Islamic banking. Yusoff and Yaacob (2010) in this context stated that there are two types of business supports, i.e. financial supports (property loan, working capital, and grant) and nonfinancial ones (distribution, management, courses and advisory, research and development).…”

Technological Innovation Adoption in Manufacturing Sector: The Moderator Role of Government Support

“…Government support plays an essential role, especially in a developing country [20] in the purchase of advanced machinery or equipment, provision of training, and in the implementation of new marketing method and new organization methods. SMEs, especially in manufacturing sectors, face many setbacks in terms of lack resources such as skill, insufficient capital and others primary resources, and these are among limitations that hinder the fast development of SMEs [25]. By considering the significant roles of SMEs to the nation, government interference and continuously support have become critical to the SMEs through several ways.…”

The Impact of Regional Soft Environment on SME Performance in China:Considering the Moderating Effect of Firm Life Cycle

“…The serious bureaucracy is one of the main challenges Malaysian SMEs face. It's so complex for SMEs to obtain support from government that they have to ask for help from private sectors [19]. This discussion leads us to state the following hypothesis:…”