A commitment to building good business with Indonesia
A commitment to building good business with Indonesia
Australian resources giant BHP has operated in Indonesia for
more than 20 years, with all its key business groups represented
here, from coal mining in Kalimantan to steel plants in Java, as
well as oil and gas exploration in the Timor Sea.
Until quite recently, BHP operated six distinct businesses,
employing 3,512 people in five offices scattered around Jakarta,
other parts of Java, Kalimantan and Sumatra. It was a confusing
situation which, in the company's own admission, caused
duplication and missed opportunities.
That changed early in 1995. When the company was looking at
establishing parallel organizations in offshore locations.
Indonesia -- with its variety of businesses and opportunities --
was considered the logical place to start.
Colin Smith, at that time Group General Manager of Finance,
Steel Group, was the first country manager appointed under the
scheme. Since then, the various BHP businesses have been grouped
in a single building in central Jakarta. The move has been a
catalyst for an even closer involvement in Indonesia's
development.
"Helping BHP to grow is the primary objective of my being
here," says Smith, now Corporate General Manager and President of
BHP Indonesia.
"You have to build relationships. You have to build a profile
that is appropriate for Indonesia and BHP's Corporate profile,
attracts the best people to work for you and gives those people
the necessary training and exposure to our culture."
BHP, Australia's largest company, invests about US$3 billion a
year around the world and employs 64,000 people in 50 countries
working in five main areas of business: steel, petroleum, copper,
minerals and specialist service businesses in power generation,
transport, engineering, information technology and insurance.
All but one of those businesses -- insurance -- are
represented in Indonesia, where BHP and its partners (two of whom
are PT Bakrie and Bros. and PT Krakatau Steel) have invested more
than $200 million in expanding existing business operations and
developing new businesses since 1993, providing employment for
more than 3,450 Indonesians.
"Despite this, as in many countries, our profile in Indonesia
is still minimal. We have to build on our global reputation if we
want a long-term presence in places outside Australia, such as
Indonesia," Smith says.
Ultimately, it's about relationships," he says. "Relationships
between the company, the Indonesian Government, businesses and
people. Too many western companies move into Asia and if they're
not successful within 12 months, they pack up their bags and go.
"I've been told there's a type of Chinese bamboo that takes
four years to break the surface and then grows to 25 meters in
six months. I think business here is a lot like that.
"I think that BHP's long-term commitment to Indonesia is proof
of this. We now produce seven million tonnes of thermal coal per
annum from three mines in Kalimantan. We have two welded mesh and
rollforming plants in Pulogadung and Surabaya, with a third under
construction in Medan, Sumatra. And we have an organic and
metallic coating steel plant in Cilegon, West Java. This, in
addition to our Information Technology, Transport, Petroleum and
Power interests, is, we hope, an example of the Chinese bamboo
about to surface."