Integrated Annual Report 2023 2 3 4 5 6 7 8 9 1 79 BUSINESS REVIEW MALAYSIA OVERCOMING CHALLENGES In 2023, the Healthcare Support sector across Malaysia, Singapore and Taiwan grappled with a series of challenges. In all three countries, the industry faced margin compression due to escalating operating costs, affected by factors like aging assets, supply chain issues and increased regulatory compliance, such as the gazettement of minimum and progressive wage which has also added to our costs. Additionally, the industries in these regions were strained by clients budgetary constraints, persistent manpower scarcity exacerbated by high staff attrition and competition for talent. To mitigate these challenges, UEM Edgenta employed a range of strategies as outlined below: Key Challenges Margin compression due to higher operating costs contributed by cost inflation from maintenance of aging assets and infrastructure, supply chain challenges, regulatory compliance requirements such as the minimum wage, labour shortages and higher attrition rate Mitigation Strategies Diligent improvement in delivering quality services through enhanced operating model and business efficiency to retain clients’ trust Cost optimisation through austerity measures such as stringent monitoring of overtime claim, centralised purchase of consumables or spare parts and revision of services or maintenance contracts Key Challenges Talent retention, rewards and recognition Mitigation Strategies Review of organisational structure, manpower upskilling and redistribution Key Challenges Limited growth in new revenue and businesses due to prudent spending by clients Mitigation Strategies Leveraged on strategic technology partnership and digitalisation adoption or mechanisation to improve productivity and generate better margin and branding
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