From Production to Knowledge: Why Malaysia and ASEAN’s Digital Economy Is Still Stuck and What Policy Must Change - By Nik Zafri

Read this article as well : 

SHARING ECONOMY VS TRADITIONAL BRICK AND MORTAR IN THE 21ST CENTURY – BY NIK ZAFRI

By Nik Zafri

Summary

Malaysia and ASEAN have made significant strides in digitalisation, from e‑government services and fintech adoption to AI roadmaps and smart cities. Yet beneath this progress lies a structural contradiction: our digital economy largely operates on a production‑based (P‑based) capitalist logic, rather than a true knowledge‑based (K‑based) economy that digital technology promises.

This article will try to address the constraint is not technological capability, but policy design, governance frameworks, and legacy measurement systems. Without deliberate reform, digitalisation will continue to amplify consumption, inequality, and environmental stress rather than generate shared intelligence, resilience, and long‑term value.

1. THE ASEAN-MALAYSIAN DIGITAL PARADOX

Malaysia’s digital agenda supported by initiatives such as #MyDIGITAL, #Industry4WRD, National AI Roadmaps, and various smart city programmes emphasises:

• Platform growth,

• Startup ecosystems,

• Cashless payments

• E‑commerce expansion

Across ASEAN, similar patterns emerge in Singapore, Indonesia, Vietnam, and Thailand.

However, most digital success is still measured by:

• Gross transaction value (GTV),

• User acquisition numbers,

• Platform scale,

• Contribution to GDP

These are P‑based indicators, not K‑based ones. The result is a digital economy that sells more efficiently, but does not necessarily think better.

2. WHY P-BASED LOGIC PERSISTS IN POLICY

2.1 GDP and Fiscal Metrics Dominate

Public policy continues to rely on GDP growth, consumption, and investment flows as primary indicators of success. Knowledge creation, prevention of loss, environmental preservation, and social trust, all critical in ASEAN’s climate‑vulnerable context remain largely invisible to national accounts.

2.2 Investment and Incentive Structures

Government grants, tax incentives, and venture funding prioritise:

• Scale,

• Speed,

• Monetisation

Rarely do they reward:

• Knowledge transfer,

• Skills deepening,

• Open data contribution,

• Reduction of systemic risk

This biases innovation toward platforms that extract value rather than systems that distribute intelligence.

3. P‑BASED VS K-BASED ECONOMY (Policy Lens)

4. THE ASEAN CONTEXT : Why This Matters More Here

ASEAN economies face overlapping challenges:

• Climate vulnerability (floods, heat, food security),

• Ageing infrastructure,

• Youth underemployment,

• Skills mismatch,

• Environmental degradation

A P‑based digital economy worsens these by encouraging over‑consumption and resource strain. A K‑based economy, by contrast, prioritises:

• Predictive systems,

• Preventive policy,

• Skills intelligence,

• Regional knowledge sharing

For Malaysia, this aligns directly with national aspirations on sustainability, ESG leadership, and high‑income status.

5. GOVERNANCE GAPS HOLDING BACK THE TRANSITION

• Policy Silos : Digital, climate, education, and economic policies operate independently,

• Outdated Accounting : Intangible assets and avoided losses are not recognised,

• Platform Regulation : Focused on competition, not knowledge responsibility,

• Public Procurement : Rewards lowest cost, not highest intelligence,

• Data Governance : Treats data as commodity rather than public infrastructure

6. POLICY RECOMMENDATIONS FOR MALAYSIA AND ASEAN

6.1 Redefine National Success Metrics

• Complement GDP with knowledge, resilience, and risk‑reduction indicators,

• Integrate ESG, SDG, and climate intelligence into fiscal planning

6.2 Reform Digital Incentives

Tie grants and tax incentives to measurable knowledge transfer

Reward platforms that reduce systemic costs (energy, fraud, waste)

6.3 Treat Data as Strategic Infrastructure

(which is the very reason why we need a real working Data Centers not for fancy but what works and benefits us)

• Establish trusted data commons for climate, health, and finance
• Encourage cross‑ASEAN data interoperability

6.4 Embed Knowledge in Public Procurement

• Prioritise solutions that improve decision quality, not just cost savings,

• Value learning systems, not one‑off deliverables

6.5 Strengthen Regional Knowledge Cooperation

• ASEAN‑level platforms for shared intelligence on climate, supply chains, and security,

• Reduce duplication through collective learning

7. REFRAMING DIGITAL TRANSFORMATION

Digital transformation must shift from:

• Faster consumption to Smarter decisions,

• Platform scale to System intelligence,

• User capture to Capability building

AI, analytics, and automation should be deployed to prevent harm, optimise resources, and raise collective competence, not merely to increase sales.

CONCLUSION : A POLICY CHOICE, NOT A TECHNOLOGY PROBLEM

Malaysia and ASEAN do not lack digital infrastructure, talent, or ambition. What is missing is policy alignment with a knowledge‑based future.

The continued dominance of a P‑based digital economy is a governance choice,  reinforced by outdated metrics, incentives, and power structures. Transitioning to a K‑based economy requires courage to redefine value, patience to invest long‑term, and humility to share intelligence across institutions and borders.

We are not constrained by technology. We are constrained by how we choose to measure success.

The digital future will not be decided by how much we produce or consume but by how well we learn, adapt, and govern together.

THOUGHT FOR THE DAY - 21/10/2025

I must have spoken about this too many times but let's just do a quick reminder.

Copying and pasting content literally from ChatGPT or other AI-assisted applications can often be detected. Unique punctuation styles, language patterns, scattered emojis and image metadata make it easy to trace such material through reverse searches.

While AI tools can enhance productivity, it is essential to review, rephrase, and verify the accuracy of the generated text. As someone accustomed to traditional writing methods, I can easily identify grammatical inconsistencies, contextual errors, irrelevant data, wrong sampling, factual errors or deviations from the original topic.

It doesn’t feel organic when the person simply lets AI do the work and allows it to spread without even caring what has been written. Writing should still reflect the writer’s own thought process and understanding.

Educators and supervisors frequently emphasize comprehension over completion (of course they do have "Anti-ChatGPT/AI"), they will ask whether the writer truly understands their work. Therefore, use AI responsibly and ensure that your writing reflects your personal understanding and critical thinking.

Thriving Through Organizational Change: Bridging Seasoned and Young Professionals - by Nik Zafri

 

“Change is the only constant” 

a phrase often repeated, rarely understood in its full weight until it lands on your desk, your workflow, or your job description. 

Organizational change whether driven by digital transformation, leadership shifts, restructuring, or market realignment is no longer a once-in-a-decade event. It is ongoing, accelerating, and multi-generational.

In my experience conducting motivation-based courses, I’m consistently asked the following two questions :

• How do professionals, young and seasoned alike, not just survive but thrive through change? 

• How can senior professionals remain relevant and respected even when reporting to younger bosses?

These are hard questions for me but I'll try to delve with case studies, research-backed insights, and actionable strategies for everyone in today’s evolving workforce.

1.0 The Reality: Change Is Disruptive (and Expensive)

According to McKinsey & Company , nearly 70% of organizational transformation efforts fail, largely due to :

• employee resistance, 
• lack of engagement, or 
• unclear communication. 

Yet when executed well, organizations that embrace structured change see productivity increase by up to 25% and employee satisfaction rise by 20–30%.

Meanwhile, a 2023 Deloitte Global Human Capital Trends survey found that:

61% of professionals felt overwhelmed by constant change,

48% feared being left behind due to digital transformation,

But 71% were willing to reskill or shift roles if given clarity and support.

Case Study 1: Siemens From Traditional Engineering to Digital Twin Leadership

Case Study 2: Unilever – Flattening Hierarchies and Empowering Young Leaders

2.0 How Can Young Professionals Adapt?

a. Stay Curious, Not Complacent

Ask questions, not just for knowledge but to learn from others' experience. Show humility when working with seniors, it earns trust and opens doors.

b. Get Comfortable with Ambiguity

Change is rarely clear-cut. Embrace iterative work and unstructured problem-solving.

c. Build Tech and People Skills Together

Digital skills are essential, but so is empathy, communication, and cross-generational respect.

3.0 How Can Seasoned Professionals Adapt?

4.0 What Happens When the Boss is Younger?

Let’s be honest, it’s awkward at first for both sides. 

BUT RESPECT IS EARNED, NOT DICTATED BY AGE

“In my mid-50s, I found myself reporting to a 32-year-old CMO. At first, I felt invisible. But once I started mentoring his team on stakeholder management and client psychology, skills AI can't teach he told me I was his most trusted partner.” - Former Global VP, now Leadership Coach

4.0 Conclusion

For All Professionals (Regardless of Age)

• Learn continuously. There are many platforms on the internet,
• Strengthen emotional intelligence. That’s what holds people together during turbulent change.
• Communicate transparently. Ask, share, clarify, silence kills culture.
• Adapt your role to value delivery, not title.
• Ask yourself - “How do I help the team win?” will beat “What’s in my job description?”

Change is no longer something to "get through." It's the new normal.

Whether you're a young professional fresh out of university, or a seasoned expert with 30 years under your belt, the real winners are those who:

• Stay flexible in their role,
• Stay humble in their approach,
• And stay human in how they work with others.

Because in a world where AI is doing more, it’s the human capacity to adapt, relate, and guide that becomes most valuable.