HR Evolution in Malaysia: Challenges and opportunities

Despite the significant disruption over the past three years, companies in Malaysia have taken several steps to maintain their economic growth. HR leaders in particular have been responding to tectonic shifts in business practices and by adopting technological advancements and overhauling their HR processes. 

Adapting to changing expectations 

Much like the rest of the world, the different stages of the Covid-19 pandemic have left an indelible mark on how Malaysians work and, more importantly, how they view their work life. According to an E&Y survey, only 22% of Malaysians prefer working in an office full-time, and nine in 10 expect the flexibility to work when and where they want to. Moreover, 70% of the respondents believed that hybrid work models improve productivity, and nearly half were willing to quit their jobs if companies didn't offer flexibility post-pandemic. 

These findings are in conjunction with a Randstad survey of HR professionals about remote working. In this report, flexibility, shorter working hours on Fridays, and reliable technology were the top three expectations from employees to improve their work-life balance. 

These insights reflect a changing workforce expectation in Malaysia that has necessitated an overhaul of traditional workspaces. As a result, Malaysians today are prioritizing working with employers who offer better work-life balance. 

Combined with a rise in the number of contingent workers in the job market, these developments have forced HR leaders to implement organizational changes in virtually every HR function. The goal is to address these shifts in a timely fashion and meet  workers where they are. 

Building an employee-centric workplace 

The changes to address evolving worker expectations are tied closely to redefining the modern workplace concept. With hybrid models and increased flexibility, there is a greater focus on employee well-being and personalizing experiences for each individual. There is an increasing willingness to offer flexible rewards, hire diverse workers, provide career development support and offer financial wellness training among employers. 

Employee skill development and training have been at the forefront of these changes, as 61% of Malaysian employees state that they want to develop their technical skills and become more productive in the workplace. However, HR's response to these needs may require some acceleration. For example, Randstad's Workmonitor shows that while 85% of Malaysians agree that employers must offer learning and development training programs, only 36% attest to such training in the past year. 

Modifications to the company culture are an integral part of creating this new-age workplace. There is renewed emphasis on diversity, inclusion, and equity, there has also been a recognition of the need to follow ESG (environment, sustainability, and governance) values. As KPMG's report shows, there is a recognition in Malaysia that DEI and ESG initiatives add greater value to the organization. The report suggests that the only way forward is to adopt a 'total workforce' approach that enables employers to offer engaging employee experiences and creatively identify and fill the skills gap.

Charting the future of HR evolution

Fahad Naeem, Country Director at Randstad Malaysia, sums it up best, in Malaysia's Job Market Outlook and Salary Trends 2023 report, "Change is crucial to thriving in Asia's rapidly evolving business landscape. With people serving as the backbone of any organization's success, business leaders learn to address employee expectations for more effective talent attraction and management efforts."

To identify these issues comprehensively and identify the challenges that HR practitioners in the country face, People Matters and Darwinbox present the HR Evolution Perspective 2023: Empower & Evolve research study. This study aims to analyze the progress of talent management practices and HR priorities in Malaysia and provide actionable insights to HR leaders to navigate 2023 and beyond successfully.

One of the largest studies of its kind in Asia, the study aims to help businesses and CHROs to understand the priorities, trends, and opportunities in HR and decode what change means for companies across Malaysia. As an HR leader or practitioner, we invite you to share your valuable insights and experiences to help build the right perspective for the future. While change is the only constant, learning about the change's nature, scale, and pace can help us respond better. 

Participate in the study now to help HR evolve and future-proof itself.