• Emerging capacity crisis: 83% of Malaysia’s workforce reports lacking sufficient time or energy for their work, highlighting the urgent need for AI solutions
• Malaysia embraces transformation: 89% of Malaysian leaders say this is a pivotal year to rethink core strategies and operations
• Malaysia leads in confidence and readiness: 86% of Malaysian leaders are confident in using AI agents to expand workforce capacity

Kuala Lumpur, 8 May 2025 – New data released from Microsoft’s 2025 Work Trend Index reveals how the rise of AI-driven intelligent agents is redefining the traditional organizational chart and transforming knowledge work across every job level – from the C-suite to frontline workers.

The latest data exposes a widening capacity gap, with 61% of Malaysian leaders saying productivity must increase, but 83% of the country’s workforce – both employees and leaders – saying they lack enough time or energy to do their work. This is supported by Microsoft 365 telemetry data, which shows that on average, employees are interrupted every two minutes by meetings, emails, or pings.

However, with the rise of agents that can reason, plan, and act as digital labor, roles and organizations will reshape to scale capacity as needed. Already, 89% of Malaysian leaders say this is a pivotal year to rethink core strategies and operations – and 86% say they’re confident they’ll use agents as digital team members to expand workforce capacity in the next 12 to 18 months – both notably above global averages.

“Malaysia is stepping up as a regional leader in AI transformation – and the latest Work Trend Index findings affirm that,” said Laurence Si, Managing Director of Microsoft Malaysia. “With 86% of business leaders confident in using AI agents to expand workforce capacity and more than half already automating entire workstreams, Malaysia is proving how organizations can turn ambition into action and scale impact through intelligent agents.”

Reimagining teams for higher impact

As AI continues to democratize access to expertise, the data shows an evolution from rigid and hierarchical organizational charts to more fluid “Work Charts”, where teams are formed around outcomes rather than siloed functions like marketing or finance – mirroring a model typically used on movie production sets today.

With agents acting as research assistants, analysts, or creative partners, companies can deploy lean, high-impact teams on demand. In fact, more than half of Malaysian leaders (51%) are already using agents to fully automate workstreams or business processes – above the global average of 46%.

But to maximize impact, organizations need to achieve the right ratio of human and digital labor for specific tasks. The report highlights that employees in Malaysia turn to AI to access capabilities humans can’t provide: 24/7 availability (44%), machine driven speed and quality (35%), and unlimited ideas on demand (31%).

The rise of the Frontier Firm

The report points to the emergence of Frontier Firms – a new type of organization powered by hybrid teams of humans and agents – as proving what’s possible by scaling faster, moving with greater agility, and creating value in new ways.

Workers and leaders at these Frontier Firms are more than twice as likely to say their companies are thriving and that they can take on additional work. They are also more likely to report having opportunities to do meaningful work. In Malaysia, Frontier Firm workers report notably high levels of opportunity for meaningful work (92%) and ability to take on more work (58%) – far above the APAC average (77% and 21%, respectively).

Within the next two to five years, every organization is expected to begin the journey toward becoming a Frontier Firm. 44% of Malaysian leaders say expanding capacity with digital labor is a top priority in the next 12-18 months, second only to upskilling (48%). Beyond agents, 84% of Malaysian leaders also say their company is considering adding new AI-focused roles to prepare for the future, such as AI agent specialists, AI trainers, and AI workforce managers.

AI skills now a top priority

Both leaders and employees in Malaysia are rapidly building familiarity with AI agents. Nonetheless, countering last year’s findings, which showed employees leading in AI adoption, this year business leaders are ahead of the curve. 68% of Malaysian leaders report being highly familiar with AI agents, compared to just 39% of employees.

To bridge this gap, 59% of Malaysian managers expect AI training or upskilling to become a core responsibility for their teams in the next five years. Within the same period, Malaysian leaders have greater expectations than global peers that their team’s scope will expand to include redesigning business processes with AI (40%), building multi-agent systems to automate complex tasks (46%), as well as training and managing agents (48% and 44%, respectively).

Looking ahead

The findings suggest Malaysia’s early adoption of AI agents could translate into significant competitive advantages over the next decade. From the boardroom to the front line, success will increasingly depend on thinking like the CEO of an agent-powered startup – skillfully delegating to and managing teams of specialized AI agents.

Organizations embracing the Frontier Firm model are positioned to outperform traditional competitors in innovation speed, operational efficiency, and talent attraction. “AI is more than a shift in tools. It’s a strategic transformation that will be woven into the modern workplace,” adds Laurence Si. “Malaysia is emerging as a model for how AI-powered organizations can transform productivity, empower talent, and lead in the digital economy.”

Read the 2025 Work Trend Index on Worklab or visit the Microsoft blog and Microsoft 365 Blog to learn more. For all WTI blogs, videos, and assets, please visit our microsite.