Adapting to the market digitalisation shift
15 Oct 2024
For three decades, Dpstar focused on manufacturing heaters, sensors and thermocouples for local businesses. However, when the market was flooded with cheaper products from China, Ken Lim, the chief executive officer of Dpstar Group, saw growing demand for new technologies like data centres, and he swiftly pivoted the business in a new direction.
Before, Dpstar’s local clients leaned towards traditional sectors like steel and ceramic, which only a few years ago began to decline due to cheaper supplies from large exporters.
To overcome this challenge, Lim had to understand the direction of industry growth and digitalisation while moving business alongside it instead of against it.
He did this by focusing on areas of innovation at the front end of use cases, while “looking at global trends and development, and where those application use cases mostly fit for us and industries that we are in”.
Through this, Lim saw that the focus was shifting towards growth in electronics, with more projects and investments coming into areas like semiconductors and data centres.
This growth came from the US-China trade war, leading to many US companies seeking suppliers away from China and into the Southeast Asian market, which the local government was quick to capitalise on, implementing initiatives like the Malaysian Investment Development Authority committee.
“The [Malaysian] government is moving more into this direction, with a lot of investments coming from the local industries shifting their operation zone to Malaysia,” says Lim.
With this in mind, Dpstar pivoted towards digitalisation by developing their automation products in areas their business already had a presence in while adapting to new digital trends in government-focused sectors like data centres, semiconductors and life sciences.
This was not easy and something Lim says Dpstar was only able to achieve thanks to its partners and collaborators with stakeholders and industry players, such as contractors, system integrators and building companies.
“There’s an everyday kind of engagement [with these partners] where we talk about design: what works for them, what are the bottlenecks, what are the pain points, where can our products best serve them, [and] where can they optimise costs?” says Lim.
Thanks to these experiences and insights, Dpstar’s products and services have attracted not only local clients but overseas as well, securing several globally competitive contracts and partnerships.
One example was a UK aeroplane company that adopted Dpstar’s thermal solutions and a US data centre operator that took a contract for thermal sensors in data centres. Lim was unable to share the names of the two companies.
In the latter case, the data centre operator used Dpstar’s leak detection solutions alongside its critical environment monitoring solutions, like temperature sensors, among other sensors — all solutions the company developed since its shift and digitalisation.
Investing in talent as much as technology
Outside of adjusting its business strategy to ride on the global megatrends and digitalisation, another important yet overlooked aspect Lim focused on was nurturing the company’s talent for the present and possible future.
To him, ensuring employees are adequately trained, remunerated, treated fairly and have the best chance for industry growth is equally important to the business’ pivot, adapting the workforce alongside operations.
An example of this is Dpstar’s plans with the government to build the first cleanroom test facility in Malaysia for upscaling, training and developing local talent. A cleanroom is where electronics are manufactured with minimal dust and other contaminants in the air.
“[It is] a small-scale [facility] that enables students from universities, colleges, industrial professionals, end users, engineers and technicians to come and learn in terms of how they can operate [machines in this cleanroom], how they can manage [and] think about the best practices [in operating it],” says Lim.
This was made in response to how the Malaysian semiconductor industry focuses a lot on addressing the back-end side, like testing or assembly, but not on the front end. This also lines up with Malaysia’s initiative to build up the local ecosystem and talent pool.
These collaborative efforts are key to Dpstar’s strategy in digitalisation, as it ensures Lim’s team knows the technologies available and how to incorporate them into the company’s operations.
Lim recognises that other businesses are reluctant to follow this approach, attributing this towards a focus on the return on investment, and he urges other local businesses to look beyond this.
With the cleanroom, for example, Lim sees it more as a corporate social responsibility — upskilling workers, enriching the talent pool, and preparing them for a future where advanced technologies become more democratised.
Source: The Edge Malaysia
