Success story of a partnership program (2)<\/p>\n
The Bali Declaration issued late last month by the chiefs of
\n100 of the biggest business groups in Indonesia addressed the
\nneed to enhance business partnerships between small, medium and
\nlarge firms. The Astra International group, however, started its
\nown small business development program more than 10 years ago.
\nFollowing is the last of two installments of an article based on
\nSri Wahyuni's interview with Rini MS Soewandi who oversees the
\nAstra program, and several small entrepreneurs who have been
\nassisted by the program.<\/p>\n
JAKARTA (JP): Disappointed that the village cooperatives under
\nhis care hadn't progressed despite the capital and equipment
\ndonated by the company he for, H. Linggo Suprapto decided to
\nproduce his own motorcycle components.<\/p>\n
The 47-year-old owner of PT Adhi Wijaya Sentosa, who received
\nthe Upakarti award in 1992 for pioneering work, went into
\nbusiness for himself.<\/p>\n
\"Instead of doing a job without clear results, I'd better be
\non my own,\" said Linggo, who is from Surabaya.<\/p>\n
Thanks to his determination, the technical high school
\ngraduate is now able to manufacture 208 motorcycle components
\nwith a turnover exceeding Rp 300 million (US$134,000) a month.<\/p>\n
\"I have 210 workers on my payroll, 11 of whom are university
\ngraduates,\" he said, failing to hide his pride.<\/p>\n
The father of two daughters and three sons was designated in
\nJuly as the Best Small Entrepreneur of 1995 at the national
\nlevel. This was the latest in a series of achievements. He was
\nnamed the best businessman at the Jakarta level in 1992 and he
\nobtained first prize in quality control at the national level in
\n1991.<\/p>\n
Linggo's success didn't fall from the sky. He had difficulties
\nat first. \"I was compelled to sell my 16-gram wedding ring to pay
\nworker wages,\" said Linggo, recalling conditions when he started
\nup his business.<\/p>\n
\"I didn't suffer losses but the profits were very small,\" said
\nLinggo, one of the small businessmen assisted by Astra
\nInternational under its business partnership program which is run
\nby the Yayasan Dharma Bakti Astra (YDBA) foundation.<\/p>\n
Astra, which enrolled him in its business partnership program
\nin 1985, was not unknown to Linggo.<\/p>\n
In 1971 Linggo joined one of Astra's subsidiary companies, PT
\nFederal Motor. Having worked in the workshop for nine years,
\nLinggo was transferred to the engineering department. He was then
\nassigned to foster a number of village cooperatives in Sukabumi
\nand Bogor.<\/p>\n
The village unit cooperatives which were used to producing
\ntraditional agricultural tools such as sickles, long knives and
\nspades, were guided by Astra to make simple motorcycle
\ncomponents.<\/p>\n
\"The objective was to give them a value added,\" said Linggo.<\/p>\n
Having followed the training and apprenticeship programs
\norganized by Astra International, they were given machines,
\nworking capital, and orders.<\/p>\n
But the orders were not finished on schedule because they
\npreferred to work in the rice fields during the harvest season
\nthan meet deliveries.<\/p>\n
\"There was no progress,\" said Linggo.<\/p>\n
In 1985, Linggo asked permission to produce motorcycle
\ncomponents on his own. His request was approved and Linggo
\nestablished a company under the name Wijaya.<\/p>\n
With a bank loan of Rp 34 million, Linggo purchased a 63 and a
\n16 ton press for Rp 16 million. He spent the remainder on molds
\nand working capital.<\/p>\n
Assisted by six technical school graduates, Linggo started
\nproducing 12 Honda motorcycle components on order from Astra. His
\nturnover was only Rp 4.5 million a month.<\/p>\n
Now the Wijaya company, which changed its name to PT Adhi
\nWijaya Sentosa in 1993, also gets orders from other companies,
\nsuch as Matsushita Gobel, for electrical components with a value
\nof Rp 60 million a month; PT Array for rubber components worth Rp
\n90 million a month and Kawasaki and Vespa respectively for 57 and
\n30 items of motorcycle components.<\/p>\n
\"Orders from Honda constitute approximately 65 percent of our
\ntotal turnover,\" said Linggo.<\/p>\n
PT Adhi Wijaya Sentosa's assets, according to the latest
\naudit, are now worth Rp 2.8 billion, with a cash flow of Rp 640
\nmillion a month. The company is now helping develop 15 smaller
\ncompanies in Jakarta and Bogor. They help Linggo in carrying out
\norders.<\/p>\n
The latest report of YDBA shows that the Astra automotive
\ndivision alone now sources about 10 percent of its Rp 9 trillion
\ntotal annual purchases from small and medium-scale firms. But
\nprocurements from small and medium-scale firms by the whole Astra
\ngroup are projected to reach Rp 5 trillion or 25 percent of its
\ntotal by the year 2000.<\/p>\n
\"Do not see the development of small businesses as
\ntroublesome. Consider it as part of a long-term investment,
\notherwise the program will certainly not run smoothly,\" he said.<\/p>\n
\"It is simple. If the product meets the standard, we accept
\nit. If not, we reject it,\" he said. \"That is the way I do
\nbusiness with the company that has fostered me,\" he added.<\/p>\n
\"Like being given fishing gear, we only provide some
\nattractive bait,\" said Linggo.<\/p>\n
What he has received from Astra is technical and managerial
\nassistance, and marketing opportunities.<\/p>\n
\"What we need to do is to provide Q, C and D. Quality, Cost
\nand Delivery. I always safeguard them. That is my bait,\" he said.
\n(swa)<\/p>",
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