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The digital transformation journey is complex and challenging for companies and even more so for governments. When Estonia decided to pursue digital transformation and innovation, it had to understand the need for public-private sector cooperation and embrace it, which, today, has proved beneficial. Just as Estonian IT company Cybernetica played a significant role in the country’s digital transformation, it is now doing the same in Malaysia.
Owing to a flourishing IT culture, Estonia is leading the global digital transformation revolution. In particular, Cybernetica is actively exporting digital solutions to the world and offering them “the e-Estonian experience.” Following successful projects in numerous countries including the United States, Japan, and Tunisia, Malaysia is the latest addition to the company’s list en route to fulfilling its global digital transformation agenda.
Cybernetica, best known for the development of Estonia’s X-Road, recently completed the implementation of the Unified eXchange Platform (UXP) for the Malaysian government. The Unified eXchange Platform is Cybernetica’s interoperability solution that enables secure and auditable data exchange between organisations. This data exchange platform modernises Malaysia’s e-governance infrastructure and ensures secure and seamless data exchange between government agencies to facilitate digital transformation. Being the latest UXP version, the platform fulfils the government’s requirement of offering infinite scalability, among other things.
“It is a decentralised platform that enables different governmental institutions to communicate with each other directly and according to one common standard,” says Maksim Ovtšinnikov, Head of Data Exchange Technologies at Cybernetica, describing the platform. “Because the data being exchanged can be very sensitive, in Malaysia’s case, maybe financial data, health data, or citizens’ personal information, security is crucial to this setup. So, the data being exchanged is encrypted and timestamped,” he continues.
Maksim Ovtšinnikov
Top 10 in world digital competitiveness by 2025
Malaysia is considered one of the most digitally advanced countries in the world. According to the International Institute for Management Development (IMD), “decades of electronics investment from multinational business and a forward-looking government through the 1980s and 1990s” prepared the country well for the digital era. In 2020, the country’s digital economy generated 22.6 per cent of its GDP. As of 2021, the country ranked 27th in the IMD World Digital Competitiveness Index, ahead of Japan and Qatar. But the country wants way more.
In a statement obtained by The Star, Datuk Abdul Latif Abu Seman, Director-General of the Malaysia Productivity Corporation (MPC), revealed that Malaysia targets the top 10 in the World Digital Competitiveness Index by 2025 and that this would be achieved through numerous strategies, including improving the construction of the government’s digital infrastructure. With the UXP now in place as an integral part of the state’s digital infrastructure, Malaysia appears to be on course to achieving this target. About ten government agencies are already connected to the UXP, and over 30 more are expected to be integrated by 2023.
Estonia’s emulateable footsteps
Just as the X-Road is the backbone of e-Estonia, enabling efficient and secure data exchange between the public and private sectors, Cybernetica hopes Malaysia will also be able to follow the same path. “Currently, only governmental institutions are using the UXP in Malaysia but we hope that they will follow Estonia because well, in Estonia, private companies can access data stored by government organisations when they need to,” Maksim points out.
“For example, if I run a car insurance company, I need to get information about the vehicles, like car crash history, and that is stored by the Estonian Transport Administration. Or if I am a finance startup giving loans to customers, then I need their identity information and financial data, which is also stored by the government. All that information can be retrieved thanks to the X-Road easily. So, we hope that in the future Malaysia will also be able to follow a similar pattern,” he explains.
Although the platform has been developed for the Malaysian government, Maksim notes that they will continue to work with them to develop new digital services and also offer recommendations on how the private sector can be included soon.
Cybernetica’s global outreach
Still, on the global digital transformation agenda, Cybernetica intends to explore new regions while also gaining more ground where they are active already. “We seek new opportunities all over the world. So, we are monitoring the procurements that are related to e-governance and digitalisation. We are looking to add more countries to the list,” Maksim divulges. In partnership with HLA Integrated Sdn Bhd, a leading ICT development and consultancy company in Malaysia, Cybernetica won the Malaysian government’s data exchange platform procurement, becoming their first venture into the Southeast Asian region.
“We had never worked in Southeastern Asia before, so it was a new experience. We learnt about their culture…their business culture, business relationship, and it was rewarding. The closest we had been to Malaysia before were Palestine and Japan. So aside from those two countries, we have not been active there.” Maksim notes that once they have done everything they can in Malaysia, they would look at the region on a broader scale, perhaps countries like Thailand and Vietnam.
He reveals that Africa is also on their radar. The continent is not exactly new terrain for the company, having successfully launched e-governance projects in Namibia and Benin. The company recently formed a strategic partnership with Ernst & Young Global Limited (EY) Tunisia to offer innovative technologies and e-governance solutions to the francophone region of Africa. “We definitely have African countries in mind,” he says. “Actually, we recently signed a partnership agreement with EY in Tunisia. EY Tunisia is responsible for the French-speaking region of Africa. With this partnership, we look forward to entering countries like Burkina Faso, Togo, and Mali…”
However, he reiterates that Malaysia remains the focus for now as it is a big country with semi-autonomous states just like in the United States. “Once we implement our technology on the level of the central government, we’ll try to look into these state governments to see how we can cooperate with any of them,” he says.
The journey with Estonia continues
While Cybernetica continues to explore the global landscape, the company remains connected to its roots – Estonia. Cybernetica played a crucial role in developing Estonia’s e-governance solutions and is still committed to being a key player in the constant development of the digital society. Seeking an unparalleled digital transformation, Estonia is developing proactive services, “the so-called invisible and cross-authority event-based services” designed to make public services simple, efficient, and always one step ahead for the people.
Cybernetica hopes to again contribute to the development of these proactive services. “We basically export the e-Estonian experience to other countries. Of course, applying it to different business contexts. So, we definitely want to follow Estonia’s new solutions and contribute to their development,” Maksim Ovtšinnikov highlights.
He reveals that the company will participate in the state’s procurements to develop the components for the proactive services and other new digital solutions. “And we hope that we win. If we can implement these innovative solutions in Estonia, we would certainly know better how to improve and export them,” he says.
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