Building Capacity and Capability - SME Corporation Malaysia

National SME Development Council
SME ANNUAL REPORT 2009/10
Chapter 5: Building Capacity and Capability
70 Performance of Key Programmes in 2009
Box Article: Groom Big Programme 78
80 Programmes in 2010
Box Article: Developments on SME Competitive
Rating for Enhancement (SCORE) 83
67
CHAPTER 4
Strengthening the Enabling Infrastructure

CHAPTER 1
The Malaysian Economy
68 National SME Development Council SME ANNUAL REPORT 2009/10

National SME Development Council
Building Capacity
and Capability
SME ANNUAL REPORT 2009/10
69
In order for Malaysia to attain a high income
economy that is built on innovation,
technology and creativity, human capital
would be one of the key determinant
factors. This is particularly critical for SMEs
given that the sector represents the bulk
of the businesses in Malaysia. Part of the
national SME development agenda is to
focus on stepping up measures to build up
the entrepreneurship capability and skills
of SMEs in order to be equipped with the
appropriate knowledge, competencies and
technical expertise in the pursuit of building
strong homegrown champions that can
compete internationally.
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CHAPTER 5
Building Capacity and Capability
70 National SME Development Council SME ANNUAL REPORT 2009/10
Amidst the challenging economic
environment in 2009, policy measures
announced by the Government under
the stimulus package did not only
focus on stimulating the economy in
the short term but also on building
the long-term capacity of the
economy in order to prepare SMEs
to seize the opportunity during the
economic recovery. Efforts were
intensified especially to enhance
entrepreneurship skills and to retrain
displaced workers to develop new
skills and to move to other economic
activities.
The challenging times also demanded
that SMEs continuously work towards
reducing costs and wastages;
employ better credit control and cash
management; focus on productivity
enhancement; and diversify into new
markets and products/services in
order to remain competitive. Building
greater resilience was not only aimed
at sustainability of business but also
to enable SMEs to seize new business
opportunities in the changing business
environment.
Performance of Key Programmes in 2009
In 2009, the Government implemented a total of 119 programmes under this
strategic thrust, with a financial expenditure amounting to RM804 million which
had benefited some 289,200 SMEs. Programmes in building capacity and
capability can be broadly divided into seven key areas as follows:
Human Capital
Development
Entrepreneurship
Development
Marketing and
Promotion
Product
Development
CAPACITY &
CAPABILITY
BUILDING
Technology
Enhancement
Advisory
Services
Awareness and
Outreach
The focus was nevertheless on three main areas, namely entrepreneurship
development; human capital development; as well as marketing and promotion.
The programmes under the three areas accounted for almost 80% of the total
number of programmes under the strategic thrust on capacity and capability
building, with financial expenditure amounting to RM668 million benefiting about
285,800 SMEs across all sectors (refer to Table 5.1).

National SME Development Council
SME ANNUAL REPORT 2009/10
Table 5.1: Key Areas for Capacity and Capability Building
Key areas Programmes Financial SMEs
Expenditure Benefitted
(RM mil)
Entrepreneurship Development 45 308.0 91,908
Human Capital Development 32 124.3 176,535
Marketing and Promotion 18 235.4 17,364
Total 95 667.7 285,807
Entrepreneurship Development
Entrepreneurship covers an important
aspect of the business growth cycle
as innovativeness, market savvyness,
risk taking and management of a
business would determine the
success and viability of an SME.
Entrepreneurship programmes have
been structured in a holistic manner
to develop these competencies.
The support system comprised both,
financial and non-financial technical
assistance to build entrepreneurial
skills. During the year, a total of 45
programmes were implemented to
promote entrepreneurship
development among SMEs. The
bulk of these programmes were
implemented by the Ministry of
Plantation Industries and Commodities
(MPIC), the Ministry of Rural and
Regional Development (MRRD),
and the Ministry of International
Trade and Industry (MITI).
Among the key programmes
undertaken by MPIC and the
outcomes were as follows:
Tunjuk Nasihat Sawit (TUNAS)
Programme: The Malaysian Palm
Oil Board (MPOB) which
conducted the activities through
the TUNAS Centre drew the
participation of 64,314
smallholders. MPOB also
conducted a Quality Palm Oil
Seedings Assistance Schemes
for Smallholders which benefited
3,522 entrepreneurs;
Transfer of Technology in Estates
in Sabah: The Malaysian Rubber
Board (MRB) conducted the
programme with the aim to
develop model holdings and
rubber group processing centres
as well as to implement training
and transfer of technologies
which benefited a total of 660
smallholders; and
Entrepreneur Development
Programme: Plantation of cash
crops other than cocoa
implemented by the National
Kenaf and Tobacco Board (LKTN)
involving 436 entrepreneurs
covering 729 hectares of land.
The programme had enabled
71
these entrepreneurs to produce
a total of 7,072 tonnes of cash
crops valued at RM6.8 million.
During the year, MRRD also
conducted a few programmes to
promote entrepreneurship and these
among others include:
The Commercial Agriculture
and Rural Tourism Programme:
MRRD in collaboration with State
Governments managed to
increase the income of 719 SMEs
in the rural area through tourism
and agriculture activities;
Entrepreneur Training
programme: The Majlis Amanah
Rakyat (MARA) provided business
exposure to some 12,344
entrepreneurs to create and
develop competitive and dynamic
entrepreneurs;
Additional Economic Activities
(AET): The Rubber Industry
Smallholders Development
Authority (RISDA) enabled a total
of 1,165 smallholders to obtain
an average household income
of at least RM2,000 per month;
and
Training and Entrepreneur
Guidance: Jabatan Kemajuan
Masyarakat (KEMAS) successfully
trained and facilitated 720 ex-
KEMAS skilled trainees and rural
entrepreneurs to venture into
business.
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72 National SME Development Council SME ANNUAL REPORT 2009/10
Meanwhile, programmes by MITI
also yielded significant outcomes
and these include:
Financial Assistance Scheme
for SMEs in the Services
Sector: The programme
conducted by SME Corporation
Malaysia (SME Corp. Malaysia)
approved a total of RM46.2
million to 1,682 SMEs. The
Scheme had not only assisted
SMEs to achieve 80% business
viability, but also to increase sales
by 20 - 30%;
Hawkers and Petty Traders
Entrepreneurship Training:
The Institut Keusahawanan
Negara (INSKEN) provided
training to 1,256 hawkers and
petty traders, of which about
83% of the participants indicated
that the training had enhanced
their knowledge and expertise;
Bumiputera Enterprise
Enhancement Programme
(BEEP): The programme
conducted by SME Corp.
Malaysia benefited 87 SMEs,
enabling these companies to
increase annual sales by 20 -
30%; and
Acculturation and
Entrepreneurship Training
programmes by INSKEN: These
programmes which attracted
some 84,565 participants during
the year were aimed at
developing more knowledgeable,
skilled, progressive, resilient and
competitive entrepreneurs.
Other key initiatives undertaken to
promote entrepreneurship throughout
the year included the Homestay
programme by the Ministry of Tourism
(MOTOUR) which benefited a total of
1,534 SMEs. The programme aims
to enhance the quality of Homestay
services through streamlining and
tightening of the registration process
and requirements. To qualify under
the Homestay programme, the
entrepreneur has to attend the basic
Homestay course and undergo
inspection by the panel appointed
by MOTOUR.
Human Capital Development
An innovation-led economy does
not only require creativity and high
investments in technology, but also
highly skilled workforce to support
the entire chain of activities.
Recognising the importance in
building a greater talent pool and
skilled workforce, the Government
further intensified efforts to develop
human capital in 2009. A total of
32 programmes were implemented
at the cost of RM124.30 million
benefiting 176,535 individuals.
Most of these programmes were
carried out by the Ministry of Human
Resources (MOHR), MITI and MPIC.
Pembangunan Sumber Manusia
Berhad (PSMB) an agency under
MOHR is responsible to enhance the
knowledge and skills of the workforce
through effective management of the
Human Resources Development
Fund (HRDF). Through HRDF
Schemes namely Skim Bantuan
Latihan (SBL), Skim Bantuan Latihan
Khas (SBL Khas), Program Boleh
Lulus (PROLUS) and Perjanjian
Latihan (PERLA), PSMB continued
to emphasise on retraining and
upgrading skills of Malaysian workforce
in order to equip the workforce with
specialised, up-to-date skills in line
with the business needs and the
development strategy of the country
towards a high income economy.
In 2009, a new scheme called
“On-the-Job Training” had been
introduced to SMEs registered under
HRDF. This initiative was taken to
facilitate SMEs to train their workers
internally and minimise the disruption
involved in sending a worker to
external training. In 2009, a total of
58 programmes have been approved
under this scheme.
During the year, PSMB has also
provided consultative visits to SMEs
registered under the Agency to
extend advisory services in the area
of training and to inform SMEs on the
available schemes and financial
assistance available under PSMB. A
total of 180 companies were visited in
2009 under this programme.
The combined efforts had benefited
SMEs especially in developing their
workforce to be more innovative,
resilient and competitive. This initiative
resulted in the utilisation rate of the
HRDF amongst SMEs to increase
from 34% in 1999 to 73% in 2009.
As at end-2009, the number of SME
employers registered with HRDF
totaled 8,404, or representing 70%

National SME Development Council
of the 12,045 total employers
registered. A total of RM73.09 million
of financial assistance was approved
for SME employers, constituting
about 21.5% of the RM340.65
million approved for all employers in
2009.The training places approved
for SME employers were 122,989 or
17.9% out of 685,394 training places
approved for all employers. This is
very encouraging, considering that
the number of workers in SMEs is
only about 345,357, or constitute
16.6% of the total workers of
2,085,438 whose employers are
registered with PSMB.
Apart from administering the HRDF
and its role as a driving force in
training and development of the
Malaysian workforce, PSMB was
entrusted by the National SME
Development Council (NSDC) back in
Dec 2004 to be a coordinating body
to coordinate and oversee training
and human resource development for
SMEs across all economic sectors.
Under its role as a coordinating body,
PSMB has implemented initiatives,
amongst which include:
• “Train the Trainer” (TTT)
programme to ensure the quality
of training provided by Ministries
and Agencies. A total of 30
sessions were organised, and
attended by 423 trainers and
training coordinators. In addition,
24 Evaluation-on-Effectiveness
of Training programme (EET) were
also attended by 322 trainers and
training coordinators from the
Ministries and Agencies;
SME ANNUAL REPORT 2009/10
73
• Brainstorming on Core Competency to identify core competency and
training needs in selected sectors. For year 2009, four brainstorming
sessions were conducted which involved aquaculture, landscape,
construction-related architecture and interior design, and driving institute.
The template of core competency and training needs for each sector was
published in the PSMB portal for reference of SME employers; and
• SME Forum to establish close linkages with industry associations,
SME employers, and Government Agencies in order to obtain feedback
pertaining to relevancy of training programmes. Four sessions were
conducted in 2009.
Meanwhile, MITI through its agencies conducted various human capital
development programmes which include:
Skills Upgrading Programme:
The programme implemented by SME Corp. Malaysia through the 41
appointed Skills Development Centres (SDCs) and Professional Training
Providers (PTPs) benefited a total of 8,364 employees from 4,835 SMEs in
2009. Based on the feedback gathered, 91% of the participants agreed that
the courses have enhanced their skills and capabilities; and
Capacity Development Programme:
Malaysia Productivity Corporation (MPC) carried out the programme with
the aim to enhance and develop the capacity of SME employees in the area
of productivity and quality. The programme attracted a total of 6,914 SMEs.
Other key programmes in human capital development include:
Short-term Courses:
The programme by the Ministry of Higher Education (MOHE) aims to provide
alternative career path for school leavers and provide lifelong learning in
developing knowledge community. A total of 121,000 participants had
benefited from the programme. MOHE also conducted the Self
Development Module programme to provide exposure to a total of 14,000
universities and Community College students on soft skills and
entrepreneurship courses to inculcate their interest in entrepreneurship;
and
Mesra Malaysia Programme:
The programme by MOTOUR involved 292 training courses which attracted
a total of 15,000 participants.
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74 National SME Development Council SME ANNUAL REPORT 2009/10
Marketing and Promotion
To enhance the marketability and
presence of products and services
by Malaysian SMEs, the Government
spent RM235.4 million in 2009
towards marketing and promotional
initiatives. A total of 18 programmes
were organised throughout the year
benefiting a total of 17,364 SMEs.
Majority of these programmes were
carried out by MITI and among the
programmes with significant
outcomes were:
Export promotion activities
and seminars: The activities
undertaken by Malaysian External
Trade Development Corporation
(MATRADE) benefited some
10,000 SMEs in enhancing
knowledge and facilitating
exports;
One District One Industry
(SDSI) Showcase: The showcase
attracted a total of 565 exhibitors
and generated sales amounting to
RM1.02 million and recorded a
contract value of RM21.9 million.
A total of 705 business matching
sessions were also organised;
SMIDEX 2009: The programme
organised by SME Corp. Malaysia
to promote products and services
of SMEs attracted participation of
333 exhibitors and 9,032 trade
visitors. Meanwhile, the Business
Matching Sessions organised
during the event managed to
generate potential sales of
RM150 million; and
Malaysia Kitchen Programme:
The programme by MATRADE
promoted a total of 461
restaurants operating abroad
with a total expenditure of
RM21.4 million aimed at
increasing patronage to
Malaysian restaurants by 30%.
In addition, the Ministry of Domestic
Trade, Co-operatives and
Consumerism (MDTCC) undertook
various promotional activities in
collaboration with the hypermarkets/
supermarkets locally and abroad in
2009 through its Produk Malaysia
Citarasa Kita (PMCK), Taste of
Malaysia and business matching
programmes. Eight programmes
were devoted to promoting PMCK
which attracted the participation of
266 SMEs generating sales in excess
of RM3.7 million. In July 2009,
MDTCC also organised the Franchise
International Malaysia Exhibition that
attracted 90 exhibitors and 110
booths, made up of local and foreign
franchisors. The exhibition received
7,843 visitors and successfully
generated potential sales amounting
to RM340 million.
Meanwhile, the Federal Agriculture
Marketing Authority (FAMA)
undertook aggressive marketing
efforts for agriculture and agro-based
products with the total products
marketed directly by FAMA and
SMEs assisted by FAMA nationwide
amounting to RM 1.1 billion in the
year 2009.
The Farmers Market provided 364
outlets for 17,298 entrepreneurs
who managed to market agriculture
and agro-based products valued
at RM490 million in the year 2009
(2008: 322 outlets for 14, 905
entrepreneurs with sales value of
RM438 million). Meanwhile, the
number of Agrobazaar K-Shoppe
had doubled to 50 outlets in 2009,
from 25 outlets in the previous year.
To ensure that the agricultural
produce was marketed effectively,
320 entrepreneurs participated in
392 FAMA Fresh Fruits Stall
programmes generating an increase
in sales of 52% to RM198 million in
2009 (2008: RM130 million). Overall
in the year 2009, FAMA successfully
took part and represented in 23 trade
and consumer exhibitions in 14
countries abroad which involved
the participation of 88 local
entrepreneurs.

National SME Development Council
Product Development
During the year, the Government
intensified efforts to help local SMEs
further develop their products and
services to ensure that local offerings
remain competitive, relevant and
meet with the constantly evolving
consumer expectations. In 2009,
eight programmes were organised
with a financial commitment of
RM125.90 million benefiting more
than 1,800 SMEs.
Among the key programmes
implemented were:
Best Practices Management
Programme: The programme
focused on sales improvement
(5%), productivity and operational
cost reduction (10%) and delivery
time improvement (85%); and
Matching Grant for Product and
Process Improvement: The
programme undertaken by MITI
via SME Corp. Malaysia extended
RM43.1 million to 422 SMEs
which recorded between 20%
and 30% increase in productivity.
Technology Enhancement
Technology assumes an integral role
in improving productivity, efficiency,
reducing wastage, lowering costs
and ultimately enhancing profitability
of SMEs. In 2009, five programmes
in technology enhancement were
implemented at a cost of RM9.5
million. These among others include
the Management Consolidation
SME ANNUAL REPORT 2009/10
75
Model implemented by MPIC via MRB with the aim to adopt modern
technology on commercial basis to manage and consolidate the management
of plantation of rubber. In 2009, the programme had successfully covered an
area of 1,347 hectares and contributed to an increase in productivity which
registered 1,924/kg/ha/year.
In addition, MITI through SME Corp. Malaysia also conducted The Automotive
Technical Experts Assistance Programme under the Malaysia - Japan
Automotive Industry Cooperation (MAJAICO). This is an initiative of the Malaysia
- Japan Economic Partnership Agreement (MJEPA), whereby SME Corp.
Malaysia was given the responsibility of handling the A-1 Project, namely
the Automotive Technical Experts Assistance Programme. This Programme
is aimed at upgrading the local automotive parts and components
manufacturers to move up to high value added products and to enhance
capacity through the Lean Production System (LPS).
Since its commencement in November 2006, a total of 77 companies had
participated, with 164 improvement projects completed where these companies
were guided and monitored by 68 Japanese industrial experts with vast
experience in the automotive industry. This MAJAICO A-1 Project is scheduled
to be completed by June 2011, with 150 projects expected to undergo
improvement. Under the LPS project, various measurable improvements and
bottom-line impact have been undertaken through the weekly KAIZEN
activities. Among the achievements were:
Impact Area Achievement
Inventory (working capital) reduction 75%
Cycle time reduction 50% to 90%
Delivery lead-time reduction 62%
Productivity and quality improvement 65% to 85%
Defect reduction 81%
Die setup time reduction 61%
Manpower reduction 20%
Work in progress (WIP) stock reduction 57%
Space savings 50%
Loading efficiency 87%
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CHAPTER 5
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76 National SME Development Council SME ANNUAL REPORT 2009/10
Awareness and Outreach
A significant amount of focus
continued to be channelled towards
keeping SMEs abreast with the latest
information on initiatives and
development programmes, in addition
to disseminating news as well as
business leads. The awareness and
outreach was done by the Ministries
and Agencies through conventions,
workshops, seminars, exhibitions
and briefings. Amongst these include
the programmes by MITI through
SME Corp. Malaysia which attracted
92,000 participants in 2009 and
through MPC which organised the
Industry Excellence Award
Programme and the Organisational
Excellence Development Programme
benefiting local companies particularly
SMEs. Meanwhile, the Ministry of
Energy, Green Technology and Water
(MEGTW) also implemented the
Extension of TNB Vendor Quality
Management programme benefiting
32 TNB vendors.
Online Services
In addition to the physical outreach
programmes, Ministries and Agencies
used the Internet as a medium to
reach the business community and
enhance their awareness on outreach
programmes available.
SMEinfo Portal:
www.smeinfo.com.my
This is a one-stop online resource
centre for SMEs to obtain
comprehensive and updated
information on the SME
development initiatives
undertaken by the Government.
Information is available in Bahasa
Malaysia, English and Mandarin.
SME Corporation Malaysia:
www.smecorp.gov.my
The site offers information on
advisory services, fiscal and
financial assistance, infrastructural
facilities, market access and other
programmes on SME
development.
MATRADE Online:
www.matrade.gov.my
The website offers a
comprehensive source of traderelated
information for Malaysian
exporters and foreign importers.

National SME Development Council
Agribazaar:
www.agribazaar.com.my
The site was developed by the
Ministry of Agriculture and Agrobased
Industry (MOA) in
collaboration with MIMOS
Berhad. It is an Internet-based
trading hub for buyers and sellers
of agriculture produce by
providing a platform for farmers,
producers, retailers and exporters
to interact online as well as to
have access to relevant data on
new supply, price feedback and
market projections.
iGuarantee:
www.iGuarantee.com.my
iGuarantee is a one-stop web
services portal by Credit
Guarantee Corporation Malaysia
Berhad’s (CGC) which contains,
amongst others, comprehensive
information about its products
and services. It also has an outline
facility through which the SMEs
can apply for CGC’s guarantee
schemes to secure financing from
the financial institutions.
HRDF training portal:
www.hrdf.com.my
The training portal which can be
accessed through HRDF website
serves as a centralised
information hub for all training
programmes available i.e courses,
seminars, conferences and events
related to human resource
development. It also provides an
avenue for training providers to
promote their services and for
employers to communicate with
course providers on their training
needs.
SME ANNUAL REPORT 2009/10
77
Technopreneur Development Portal:
www.technopreneurdevelopment.net.my
This is a comprehensive public domain dedicated to the ICT business,
comprising ICT SME industry database including MSC and non-MSC status
companies. The portal provides on-line information and communication
resources.
Publications
During the year, Ministries and Agencies also produce publications to enhance
awareness and outreach among SMEs on the various initiatives taken. These
include the SME Annual Report, Panduan Langkah Demi Langkah Memulakan
Perniagaan and Journey of Successful SMEs by SME Corp. Malaysia. In
addition, the Special Task Force to Facilitate Business (PEMUDAH) has also
produced various publications that are beneficial to SMEs including the
Retrenchment Management Guidelines and Guidebook on Registering Property
in Malaysia (2nd Edition).
Advisory Services
In 2009, advisory services assumed a bigger role as SMEs sought assistance
amidst the challenging environment faced during the global financial crisis.
Assistance extended to SMEs included advisory services and consultancy to
help these companies ride over the difficult period. These among others include
the One Referral Centre (ORC) at SME Corp. Malaysia to provide assistance to
SMEs on all areas and the Helpdesk at MATRADE HQ to provide advice on
matters relating to export business.
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78 National SME Development Council SME ANNUAL REPORT 2009/10
Groom Big Programme
The Programme also provides a
platform that enables new
entrepreneurs to learn from one
another as well as gain more
knowledge and establish better
networking which is intended at
creating and promoting healthier
competition within the sector
Envisioned to nurture and propel
Malaysian Bumiputera SMEs and
micro enterprises into becoming
competitive domestic and global
players, the Groom Big programme
was introduced by the former Ministry
of Entrepreneur and Cooperative
Development (MECD) in 2005. The
programme was later entrusted to the
Ministry of International Trade and
Industry (MITI) in May 2009. Groom
Big focuses on three manufacturing
sub-sectors, namely food and
beverages; cosmetics and herbs; and
glass and ceramic. The programme
was undertaken in collaboration with
SIRIM Berhad and the Forest
Research Institute of Malaysia (FRIM).
Groom Big goes beyond merely
providing financial assistance for
SMEs as the programme is meant to
impart awareness and build capacity
among SMEs on implementation of
quality, technology and standards.
This is crucial since SMEs are prone
to have issues such as absense of
legal operating license, lack of Halal
requirements in terms of raw
materials and requirements on
packaging, as well as inconsistencies
in terms of safety and cleanliness
standards. The Programme also
provides a platform that enables new
entrepreneurs to learn from one
another as well as gain more
knowledge and establish better
networking which is intended at
creating and promoting healthier
competition within the sector. The
model for Groom Big Implementation
Programme is as depicted in Chart 1.

National SME Development Council
Chart 1: Groom Big Implementation Model
Advanced
Packaging
Development of
Export Products
Evaluation
& Application
Basic Quality
Improvement
& Labelling
Halal
Certification
Branding &
Packaging
SME ANNUAL REPORT 2009/10
Quality
Improvement
Practices &
Product
Development
START
HALAL MS 1500,
HACCP, GMP,
ISO 9000
GROWTH
Promotion
Service-Oriented
Entrepreneur
Development
Over the last four years of 2005 to 2009, a total of 904 SMEs had benefited
from the programme, bulk of which were from the manufacturing of food and
beverages (819), followed by cosmetics and herbs (70), and ceramic and glass
(15). The programme has shown significant impact on upgrading the products
offered by SMEs, particularly in the area of quality improvement and labelling;
obtaining of Halal Certification; and packaging and branding. To date more than
1,000 products by participating SMEs in the programme have managed to
meet the requirements of the Labelling Act by the Ministry of Health, while about
160 SMEs have also been successfully certified HALAL by Jabatan Kemajuan
Islam Malaysia (JAKIM) or State Religious Authority. Meeting with these
important and stringent pre- requisites have enabled these SMEs to supply
products to hypermarkets in the country and in the process, increased their
sales by 20 - 50%. More than 50 companies have also participated in
promotional activities to market their products in countries such as Dubai,
Japan, Ireland, Romania and Bangladesh.
As these businesses grow, SMEs have also become increasingly aware on the
importance that factories and production facilities must adhere to high
standards as per the Good Manufacturing Practices (GMP)/Hazard Analysis
and Critical Control Point (HACCP) requirements. Physical improvements are
also noticeable in the operations of SMEs where some have since relocated to
bigger premises or are today housed in more conducive operating
environments. In addition, the Groom Big has also shown other positive
outcomes. It has spawned spillover effects by boosting other related
businesses and downstream activities, thus providing opportunities for more
than 40 other companies in the
services sector involved in
photography, design, printing and
trading.
79
Going forward, the Groom Big
Programme will be expanded to the
ICT sector, in line with the efforts to
produce more technopreneurs. Other
potential areas include the furniture
industry and services sector such as
healthcare, logistics, tourism and retail.
The programme will also emphasise
on research and development (R&D)
as a means to enabling SMEs to
further enhance their product quality
through collaboration with relevant
institutions.
Meanwhile, to further enhance both
the public and media’s awareness of
the programme, MITI will organise a
series of Groom Big Mini Showcase
in an effort to encourage the
development of more entrepreneurs
who are of quality and competitive in
the manufacturing and services
sector domestically and globally. The
showcase will display SME products
before and after undergoing the
Groom Big programme and is aimed
at increasing awareness amongst
entrepreneurs and other SMEs about
the benefits of the programme and its
effectiveness. Among the identified
locations for the mini showcase
include Kota Bharu, Kelantan for the
East Coast Region, Kedah for the
Northern Region, Johor for the
Southern Region and Sabah. MITI
will also adopt the SME Competitive
Rating for Enhancement (SCORE) as
a tool to identifiy specific assistance
to be given to companys under the
programme.
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80 National SME Development Council SME ANNUAL REPORT 2009/10
Programmes in 2010
Of the total 267 programmes that are
being implemented in 2010, 200
programmes (75%) with a financial
commitment of RM786 million are
devoted towards building capacity
and capability of SMEs. Programmes
to build capacity and capability in
2010 will continue to emphasise on
entrepreneurship development,
human capital development as well
as marketing and promotion among
the seven areas. These programmes
are expected to benefit a total of
272,500 SMEs across all economic
sectors.
As in previous years, the bulk of the
planned programmes (85) is in
entrepreneurship development, with
a financial commitment of RM276.3
million, and is expected to benefit
21,000 SMEs in 2010. Among the
programmes which are expected to
produce significant outcomes include:
• The Training and Advisory
Programme by MRRD, whereby
150 courses will be organised to
provide entrepreneurship
enhancement courses to 4,000
rural entrepreneurs;
• The Women Entrepreneurs’
Development Programme
(Program Pembangunan
Usahawan Wanita) by the Ministry
of Women, Family and Community
Development (MWFCD) which is
aimed at increasing the income of
4,000 women in low income
household to a minimum of
RM3,000 by end-2012 and
providing skills training for woman
to become entrepreneurs;
• The Training for Potential and New
Entrepreneurs Programme by
Ministry of Industrial Development
(MID) Sabah, whereby 82 courses
will be organised on
entrepreneurship development
and technical courses which are
expected to create a total of
2,700 new entrepreneurs;
• The Technical Entrepreneurs
Programme (Putek) by MRRD
which is expected to create
1,000 new entrepreneurs with
technical skills and provide
assistance in building basic
business sites/facilities; and
• SME Corp. Malaysia in
collaboration with the Malaysian
Industry- Government Group for
High Technology (MIGHT) has
begun to implement the 1-
InnoCERT (1 Innovation
Certification for Enterprise Rating
and Transformation) programme
to certify and foster growth of
innovative SMEs to become
homegrown champions.
In addressing shortages of skilled
workforce and in line with efforts to
create a competent pool of local
talent, numerous initiatives will be
undertaken to further develop human
capital. In 2010, a total of 39
programmes are being implemented
with a financial commitment of
RM184.4 million to benefit 226,850
SMEs. Among the key programmes
include:
• The Retraining and Skills
Upgrading Programme by PSMB
aims to reach out to 98,000
participants;
• The Short-term Courses offered
by MOHE through community
colleges will be further
strenghtened to include modular
programmes. The programmes
will use a flexible approach
through various short courses
especially in the technical and
vocational field. A total of 47
courses will be offered in 2010
which are expected to benefit
50,000 participants and the
number is expected to increase
to 135 courses with 120,000
participants by 2015.
• The Short-Term and Part-Time
Courses by MOHR in
collaboration with the Human
Resource Department to upgrade
and enhance industrial workers’
multitasking capabilities which
is expected to benefit 45,100
participants;
• The Entrepreneur Training
Programme implemented by
MRRD through MARA to provide
exposure, awareness and
encouragement to some 25,700
youth and adult Bumiputeras to
undertake entrepreneurship as a
career;

National SME Development Council
• The Jejari Bestari programme by
MWFCD is intended at improving
the economic status of 6,700
women in the rural areas and
increasing the number of women
entrepreneurs; and
• The National Dual Training System
(NDTS) by MOHR which is
expected to produce 5,000
apprentices and benefit 1,000
SMEs.
SME ANNUAL REPORT 2009/10
Best Innovation Award in Manufacturing Sector
Subsea Explore Services (M) Sdn. Bhd.
Best Innovation Award in Services Sector
Romstar Sdn. Bhd.
Best Innovation Award in Agriculture and Biotechnology Sector
TT Biotechnologies Sdn. Bhd.
Best Innovation Award in Design
IC Microsystems Sdn. Bhd.
Best Innovation Award in Green Technology and Energy Efficiency
Device Semiconductor Sdn. Bhd.
Best Innovation Award in Halal
Nutrivention Sdn. Bhd.
81
While Malaysian products and services enjoy a significant success in the export
market, the Government will intensify its marketing and promotion efforts to
enable local SMEs to gain a larger foothold in the global market. Emphasis
will be given not only towards enhancing awareness in existing markets but
identifying new and potential markets around the world. In 2010, a total of
35 programmes are being implemented with a financial commitment of RM125
million to benefit 10,000 SMEs.
In line with the Malaysia Innovation Year 2010, the Prime Minister had mooted
the idea that SMIDEX 2010 by SME Corp. Malaysia be themed as SME
Innovation Showcase to promote innovation among SMEs. The event which
was held from 1 to 3 June 2010, was participated only by invitation, by SMEs
who had qualified the stringent criteria based on the 1-InnoCERT. The highlight
of the event was the SME Innovation Award to acknowledge and recognise the
top most innovative SMEs. This programme was carried out in collaboration
with MIGHT to award winners from the following six categories:
Chart 5.1
Winners of SME Innovation Award 2010
CHAPTER 5
Building Capacity and Capability

CHAPTER 5
Building Capacity and Capability
82 National SME Development Council SME ANNUAL REPORT 2009/10
IC Microsystems emerged as the overall winner with a cash price of RM1
million, while the winners of the other categories were awarded RM200,000
each. In addition the Business Matching Sessions conducted during SMIDEX
2010 have also managed to generate potential sales of RM95.6 million.
Other programmes in 2010 include:
• The Branding Innovation Centre (BIC) which is an initiative under the SME
Brand Development Programme was established by SME Corp. Malaysia in
collaboration with Lim Kok Wing University of Creative Technology (LUCT).
The objective of the BIC to provide awareness on the importance of
branding and packaging and provide training on branding and packaging to
SMEs across the country. One of the activities under BIC is the Branding
and Packaging Mobile Gallery whch aims to reach out to rural SMEs to
provide awareness on the importance of branding and packaging. The
Gallery comprises a bus which has been refurbished and fitted with
packaging samples and materials;
• The Cradle Investment Programme by Ministry of Finance (MOF) with an
allocation of RM70 million is to commercialise technology ideas towards
building a stronger innovation ecosystem. The programme is expected to
benefit 110 SMEs to finance ideas and seed funding for commercialisation;
• The Halal Training Programme
which include the Halal
Awareness Programme (HAP),
Halal Industry Programme (HIP)
and Halal Professional
Programme (HPP) implemented
by MITI through Halal Industry
Development Corporation (HDC)
with the objective to increase
awareness on halal and provide
knowledge on the fundamentals
of halal and its requirements, will
reach out to more than 10,000
participants from SMEs in the
manufacturing and services
sector.

National SME Development Council
Business
Performance
5.22
4.64
4.06
3.48
2.9
2.32
1.74
1.16
0.58
0
SME ANNUAL REPORT 2009/10
Developments on SME Competitive Rating
for Enhancement (SCORE)
Management
Capability
Compliance to
Requirements
Marketing
Capability
Stock
Management
Financial
Capability
Operation
Management
The Ministry of International Trade and Industry (MITI) through SME Corporation
Malaysia (SME Corp. Malaysia) will continue to implement the SME Competitive
Rating for Enhancement (SCORE) which is a diagnostic tool to assess and rate
the competitiveness of SMEs based on company performance and capabilities.
SCORE will also identify areas for improvement and develop appropriate action
plans to guide and provide specific assistance to SMEs. At the 10 th National
SME Development Council (NSDC) meeting in February 2010, all Ministries and
Agencies involved in SME development were encouraged to adopt SCORE to
monitor SMEs under their programmes.
As at July 2010, a total of 4,686 SMEs have been evaluated under SCORE,
of which 1,605 SMEs were rated 3 to 5 stars category. SCORE is one of the
Key Performance Indicator of the Minister of International Trade and Industry
(MKPI) and the target is to achieve a total of 5,000 companies evaluated by
end-2010, with at least 1,500 in the category of 3 to 5 star. Towards this end,
SME Corp. Malaysia will introduce the Enrichment and Enhancement (E2)
Programme which will combine the elements of SCORE and the technical
and business advisory services from experts under the SME Experts Advisory
Panel (SEAP) Programme in improving the performance of companies under
the 3 star category.
3 ★
30.2%
4 ★ No ★
4.1% 4.3%
41.9%
19.5%
2 ★
83
Chart 1
SCORE Rating for SMEs as at end-
July 2010
1 ★
In order to ensure that there are
sufficient auditors for SCORE,
SME Corp. Malaysia is currently
conducting the Training of Trainers
on SCORE to train the SCORE
auditors from within the agency and
its strategic partners based on the
SCORE module. The target is to
have at least 50 auditors for SCORE
by end-2010. In addition, to cater for
the specific needs of micro
enterprise, SME Corp. Malaysia has
also developed a special diagnostic
tool for micro enterprises named as
M-CORE (Microenterprise
Competitive Rating for Enhancement).
M-CORE is a simplified version of
SCORE targeted to evaluate
competitiveness of micro enterprises
and to develop specific hand-holding
assistance to address weaknesses of
these businesses.
CHAPTER 5
Building Capacity and Capability