Astra: Building a business empire

Astra: Building a business empire

Lie Hua, Contributor, Jakarta

DARE TO DO -- The Story of William Soeryadjaya
and PT Astra International; By Charlotte Butler;
McGrawHill, Singapore, 2002; xviii + 300 pp

Astra is virtually a household name in this country, known for
holding the license to a variety of Japanese auto makes,
particularly Honda.

As the second largest conglomerate in Indonesia after the
Salim Group, Astra has played an important role in the country's
economic development.

When you talk about Astra, it's inevitable that the name of
William Soeryadjaja, now 80, one of the founders of this business
empire, will figure prominently. Born Tjia Kian Liong in the
small West Java town of Majalengka, William and Astra are
considered one and the same, even today when he is no longer the
owner of this huge business group.

Charlotte Butler, head of the research team at the Euro-Asia
Center, INSEAD, in Fontainebleu, France, spent 10 years writing
this book, basing her work on extensive interviews with those
directly involved in Astra's development. The book traces
William's prominent role in the empire, and thus can be read as
both William's biography and a business history.

Butler begins with William's early life. Born into a
relatively well-off peranakan Chinese family (peranakan means
being partly assimilated into Indonesian society), William had a
comfortable childhood. His father, a businessman, held to the
motto of "think big, do big and grow big".

Unfortunately, William lost his parents almost at the same
time in 1934. At age 12 and the eldest of his siblings, he had to
become a second parent to his five brothers and sisters.

As the family inheritance had mysteriously disappeared, the
penniless orphans were raised by their grandparents and their
youngest uncle. William, however, who acknowledged he did not
perform well in scholastic activities, felt called upon to try
his luck in business.

He began by selling scrap newspaper in 1942, during the
Japanese occupation of the country. Then, in the early days of
the Republic of Indonesia in 1945-1946, he started what he called
"legal smuggling", the transportation of goods between Bandung
and Jakarta. This early experience taught him how to navigate
systems for his own benefit, and he learned that he had to be
resourceful to keep his business going.

Shortly after his marriage in 1947, William spent a few years
in the Netherlands, where he took a two-year tannery course to
gain a qualification for a job back home. His business acumen
told him there was a good commercial opportunity in the
Netherlands after the war that would allow his family to live in
greater comfort.

It was black market trading.

He mobilized his friends and family members in Indonesia to
send parcels of cigarettes and peanuts to the Netherlands, where
these goods were sold on the black market or bartered for extra
food-ration coupons.

Back in Indonesia, he set up PT Sanggabuana (1952-1956) as a
government supplier. Unfortunately, just as the company was
flourishing he was cheated by his own partner and was left
penniless. Undaunted, in 1957 he joined his younger brother, Kian
Tie, who had set up a small company with a friend.

This company was called Astra, derived from the name of the
Greek goddess Astrea, the last goddess to retire to the heavens
where she assumed the shape of a star. William, ever optimistic,
added the word 'international'. So, Astra International came into
being in a modest space somewhere on Jl. Sabang, Central Jakarta.

Butler traces the development of the company and the adversity
it had to go through before finally emerging as a widely
diversified business empire. She also follows the role of William
in this great feat. William is pictured as a forward-looking
person, someone possessing great entrepreneurial skill.

He is interested in opening up new areas but is too impatient
to attend to details in the business. Once he was successful in
starting a new business venture, he would leave it to his
lieutenants and start opening up yet another new area. Luckily,
in the early years of Astra's development, he got help from the
cool-headed Kian Tie, who was most interested in devising a
careful strategy to develop the business.

Butler also dwells at length on Astra's joint ventures,
particularly with Japanese companies. The book gives quite a
graphic account of how deals were made and the progress Astra
achieved in its joint ventures. She also discusses Astra's
managerial philosophy and corporate culture against the backdrop
of the Indonesian business landscape, where coddling of the
government is somewhat inevitable.

The reader views scene after scene unfolding in Astra's
development following changes in the country's political and
economic realms. Against all odds, in a country mired in a deep
and prolonged economic crisis, Astra, in Butler's words, can
still be best summed up as "the brightest star in the Indonesian
business firmament. The group that William had created looked
indestructible.

"It had not just survived, but looked set to flourish once
more."