{"id":94310,"date":"2019-03-30T07:59:26","date_gmt":"2019-03-30T00:59:26","guid":{"rendered":"https:\/\/bahtera.jp\/bahtera-proposal\/"},"modified":"2025-03-17T19:30:52","modified_gmt":"2025-03-17T12:30:52","slug":"bahtera-proposal","status":"publish","type":"post","link":"https:\/\/bahtera.jp\/en\/bahtera-proposal\/","title":{"rendered":"Recommendations for Japanese Companies in Indonesia Struggling with Production Management Systems"},"content":{"rendered":"

All internal operations are tied to the company\u2019s revenue\u2014the source of cash inflow\u2014and procurement\u2014the source of cash outflow. Due to three problems\u2014lack of visibility into the current situation, numbers not aligning, and processes not connecting\u2014operational efficiency declines, and employees\u2019 awareness of sales and cost management diminishes.
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Production Control System in Indonesia<\/p>\r\n\t\t\t\t\t\t\t\r\n\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t

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It\u2019s not limited to Indonesia, but it\u2019s often said that the ultimate goals of the manufacturing industry are twofold: “cost reduction through productivity improvement” and “delivering products on time without delays.” From a management perspective, business plans are crafted to maximize growth based on market supply and demand adjustments. However, even if sales increase due to low pricing, it only reduces gross profit, leading to losses from selling and administrative expenses or non-operating costs. On the other hand, raising unit prices isn\u2019t straightforward due to market price considerations. Therefore, process management based on production plans aimed at reducing costs through … <\/p>\n\t\t\t\t\t\t\t\t<\/div>\r\n\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t

\u7d9a\u304d\u3092\u898b\u308b<\/p>\r\n\t\t\t\t\t\t\t\t\t\t\t\t\t<\/dd>\r\n\t\t\t\t\t<\/dl>\r\n\t\t\t\t<\/div>\r\n\t\t\t\t<\/a>\r\n\t\t\t\t <\/p>\n

What Factors Influence Internal Operations in Indonesian Factories?<\/h2>\n

Having worked on business systems in Indonesia for a long time, the issues with business systems that come up in conversations with Japanese companies\u2019 clients can generally be summarized into the following three points: <\/p>\n

\n
\n
    \n
  • It\u2019s unclear which shipments the goods flowing through the business process are linked to.<\/li>\n
  • Forcing operations to fit a mismatched system results in extensive Excel-based management intervening.<\/li>\n
  • Disconnected workflows between departments lead to excessive manual adjustments outside the system.<\/li>\n<\/ul>\n<\/div>\n<\/div>\n

    All internal operations are connected to revenue (shipments), the source of cash inflow, and procurement, the source of cash outflow. This trio of issues\u2014lack of visibility, mismatch, and disconnection\u2014reduces operational efficiency and leads to a decline in employees\u2019 sales and cost awareness.
    \nA company\u2019s business is determined by what it offers to meet market needs, and internal operations are shaped by how it interacts with customers and suppliers and how internal staff collaborate.
    \nSpecific examples of factors determining internal operations include: <\/p>\n

    \n
    \n
      \n
    1. As the number of customers grows but order sizes shrink, it becomes unclear on-site which orders production is for, making delivery date responses impossible.<\/li>\n
    2. Shortened product lifecycles and harder demand forecasting mean ordering and producing only what\u2019s needed for orders to avoid dead stock.<\/li>\n
    3. Overthinking point 2 and keeping too little inventory leads to line stoppages, reducing productivity and delaying deliveries.<\/li>\n
    4. With multi-variety, small-lot production flowing through lines, increasing shared line usage and uptime requires clear order linkage\u2014otherwise, excess production occurs.<\/li>\n
    5. In Indonesia, suppliers and subcontractors hold strong influence, requiring orders with sufficient lead time based on accurate demand forecasts.<\/li>\n
    6. Indonesia\u2019s low local procurement rate makes shortages of imported materials critical.<\/li>\n<\/ol>\n<\/div>\n<\/div>\n

      Business systems should be defined by these internal operation methods. Changing the operation methods determined by various factors for systemization can be seen positively as standardization or negatively as inconsistent directives. <\/p>\n

      Economic Activity Occurs on the Supply Chain<\/h2>\n

      In manufacturing, raw materials are procured, processed to add value, and sold to customers. In services, value is added by providing services based on customer requests.
      \nWhen procuring goods, suppliers are upstream, and when selling goods or services, customers or consumers are downstream. The route through which goods and information flow from suppliers through the company to customers or consumers is called the supply chain.
      \nEconomic activity is the aggregation of actions that move goods and services along this supply chain. Simply siphoning money off the supply chain without adding value isn\u2019t economic activity.
      \nEconomic activity isn\u2019t completed by a single company alone\u2014it\u2019s sustained by promises and results with suppliers, customers, and consumers. It\u2019s evaluated by metrics like \u201creliability\u201d (delivering the promised quantity with promised quality on time), \u201cflexibility\u201d (quickly adapting to customer or market demand changes to seize sales opportunities), and \u201cresponsiveness\u201d (shortening lead time from order to shipment).
      \nWithin relationships with trading partners and customers, optimizing business flows to enhance reliability, flexibility, and responsiveness is called the Standard Operation Procedure (SOP). Gaining ISO certification as proof of meeting certain standards builds trust along the supply chain. <\/p>\n

      Operational Methods Are Determined by Relationships with Suppliers and Partners on the Supply Chain<\/h2>\n

      Generally, there are two main approaches to introducing business systems for companies conducting economic activity on the supply chain, both in Japan and Indonesia: <\/p>\n

      \n
      \n
        \n
      1. Systemization assuming company operations align with a packaged system\u2019s workflow.<\/li>\n
      2. Systemization tailored to the company\u2019s unique operational flow.<\/li>\n<\/ol>\n<\/div>\n<\/div>\n

        As of 2019, the mainstream approach is standardizing company operations by aligning them with the workflows of packaged systems\u2014culminations of developers\u2019 expertise. However, this often results in an underwhelming outcome: \u201cThe system is running, but it\u2019s not delivering cost-effectiveness.\u201d <\/p>\n

        \n
        \n
          \n
        • The system is used solely for the core functions of master and inventory management among the packaged system\u2019s features.<\/li>\n
        • Despite introducing it to align with the standard flow, halfway customizations creep in due to on-site pushback.<\/li>\n<\/ul>\n<\/div>\n<\/div>\n

          Introducing a packaged system involves three main phases: requirements definition, implementation (development), and on-site deployment (training). Aligning operations with the system minimizes implementation (development) efforts, focusing the requirements definition phase on \u201chow to adapt operations to the package\u2019s specs.\u201d This works under conditions like: <\/p>\n

          \n
            \n
          • Few daily production batches or purchase orders, meaning low transaction volume.\n
            \n
              \n
            • \u21d2 Low system input burden.<\/li>\n
            • \u21d2 Sufficient time for training.<\/li>\n
            • \u21d2 High system inventory accuracy, reducing adjustment efforts.<\/li>\n<\/ul>\n<\/div>\n<\/li>\n
            • Clear operations where suppliers deliver based on orders, or customers receive shipments based on orders.\n
              \n
                \n
              • \u21d2 Order backlog management is recognized as critical, avoiding inventory-only operations.<\/li>\n<\/ul>\n<\/div>\n<\/li>\n
              • Few suppliers and customers.\n
                \n
                  \n
                • \u21d2 Fewer data format types, reducing import burdens.<\/li>\n<\/ul>\n<\/div>\n<\/li>\n<\/ul>\n<\/div>\n

                  Since internal operations are shaped by relationships with suppliers and partners on the supply chain, for most companies not meeting these \u201cfortunate\u201d conditions, aligning operations with a system is highly challenging.
                  \nWhen aligning with a package is difficult, steady work is needed: developing and implementing the system based on requirements definition, then fine-tuning specs during on-site deployment by incorporating requirements missed earlier. <\/p>\n

                  Systemizing Internal Operations in Indonesia\u2019s Excel-Driven Culture<\/h2>\n

                  Standard workflows in major packaged software like SAP or Microsoft Dynamics are accumulations of vendors\u2019 decades of expertise. Operations not aligning with these are considered flawed, and adapting to the system\u2019s flow is seen as the shortest path to efficiency\u2014a common view when considering system\u5c0e\u5165 in Japan.
                  \nThis is a valid option in an environment where goods flow smoothly between customers and suppliers per contracts, all transaction info is reflected in the system, and company decisions are made by deductively analyzing system-stored data.
                  \nHowever, in Indonesia\u2014where internal decisions are swayed by individual or departmental politics, or supply chain constraints complicate customs with customers, suppliers, and subcontractors\u2014operations take on a unique culture. As stakeholders seek the easiest methods, the result is a collection of localized optimizations.
                  \nExcel becomes a prized patch to connect these localized optimizations. While the overall operation features Excel patchwork, it inadvertently aims for global optimization.
                  \nTo systemize such operations in Japanese companies in Indonesia, it\u2019s more logical to extract critical requirements from Excel-patched, interconnected workflows and implement a system tailored to them.
                  \nIn an environment where goods flow smoothly on the supply chain and all transaction info is system-reflected, major packaged software might be the best practice. But in Indonesia\u2019s less ideal environment, diligently gathering requirements and implementing them steadily yields more visible improvements. <\/p>\n

                  \n
                  \n
                    \n
                  1. Efficiency improved by using a customized system for operations unaddressed by generic packages.<\/li>\n
                  2. Short-term plan adjustments for order delivery or quantity changes became possible, maintaining high plan accuracy.<\/li>\n
                  3. Process performance became visible on large on-site monitors.<\/li>\n
                  4. Warehouse in-out management with handheld terminals auto-linked easily to the inventory system.<\/li>\n
                  5. Attaching order-numbered tags to flowing lots made physical goods and system inventory connections visible.<\/li>\n
                  6. Monthly production planning, once taking a week, now takes 3 hours.<\/li>\n
                  7. Linking orders and procurement clarified this month\u2019s raw material needs, eliminating line stoppages from shortages.<\/li>\n
                  8. Complex production plans (color, spec, day summaries) unfeasible in Excel are now quickly created.<\/li>\n
                  9. Higher demand forecast accuracy reduced excess production and in-process inventory.<\/li>\n<\/ol>\n<\/div>\n<\/div>\n

                    Thus, in Indonesia, developing and implementing systems tailored to operations offers significant potential for efficiency gains. <\/p>\n

                    Reasons for Considering Production Management System\u5c0e\u5165 in Indonesia<\/h2>\n

                    System investment in Indonesia became a focus as Indonesian factories grew in importance, demanding accurate, rapid info management and effective info use. Broadly, it\u2019s driven by Japan HQ requests or local Indonesian needs: <\/p>\n

                    \nJapan HQ policy: <\/p>\n
                    \n
                      \n
                    • Reduce operational burden with company-wide unification.<\/li>\n
                    • Enable data monitoring from Japan.<\/li>\n
                    • Link data to Japan\u2019s system.<\/li>\n
                    • Align with Japan\u2019s rules (inventory valuation, form fields, etc.).<\/li>\n<\/ul>\n<\/div>\n<\/div>\n
                      \nDriven by Indonesian needs: <\/p>\n
                      \n
                        \n
                      • Low data accuracy.<\/li>\n
                      • Slow data entry.<\/li>\n
                      • High data entry burden.<\/li>\n
                      • Insufficient necessary data (forms).<\/li>\n
                      • Entered data isn\u2019t effectively utilized.<\/li>\n<\/ul>\n<\/div>\n<\/div>\n

                        Issues with Japan-Led vs. Indonesia-Led System\u5c0e\u5165<\/h2>\n

                        \"ProsJapan-led systemization often occurs in larger firms, driven by Japan HQ requests. The same system as Japanese factories is introduced with support from HQ\u2019s IT department, but issues arise: inability to master expensive systems, disuse after HQ staff return, inaccurate data input, and unmaintained masters.
                        \nIndonesia-led systemization typically occurs in smaller firms, with factories independently selecting systems. Not all operations unify under one system, often leaving some Excel management. Issues include duplicate entries, disconnected system workflows, and person-dependent systems.
                        \nThe requirements definition phase\u2014reviewing current operations and deciding system integration\u2014splits into three patterns in Indonesia:
                        \nComplete Japan-led is \u201cPerintah langsung\u201d (direct orders from the top), deploying HQ specs locally. Local majority rule is \u201cPengambilan suara\u201d (voting), where departmental power dynamics affect specs, making a local coordinator key. \u201cMusyawarah\u201d (consensus) seeks unanimous agreement through discussion. <\/p>\n

                        Indonesian National Traits to Consider in Production Management System\u5c0e\u5165<\/h2>\n

                        \"Handling
                        \nIn the 1990s, Japan\u2019s famed management trifecta\u2014lifetime employment, seniority, and company unions\u2014waned amid rising competition from China and Asia. Yet, the lingering Japanese habit of leaving decisions vague (\u201caun no kokyu\u201d) clashes with Indonesian office workers accustomed to clear American-style job descriptions, causing communication issues with Japanese expatriates and HQ.
                        \nLocal staff at overseas Japanese firms likely share similar thoughts: \u201cWhy don\u2019t they explain until we\u2019re satisfied?\u201d\u2014a phrase I\u2019ve heard repeatedly in Indonesia\u2019s system\u5c0e\u5165 sites.
                        \n\"What <\/p>\n

                        A Stepwise System\u5c0e\u5165 Method Suited to Indonesia<\/h2>\n

                        For years, I firmly believed that forcing non-customized packaged software as the standard workflow was the most effective approach for system\u5c0e\u5165 in Indonesia.
                        \nRecently, I realized the obvious: if the gap between new and current workflows is too wide, Indonesian staff grow skeptical of results and emotionally resist, even if the system is standardized.
                        \nFor example, if current operations confirm 50 out of 100 results before proceeding to the next 50, but a new system instantly outputs 100 with slightly different results, staff doubt it\u2014even if it\u2019s more accurate.
                        \nThough the new system can output 100 directly, we deliberately use an external add-on to replicate the current process for 0\u201350, letting staff verify results, then implement 51\u2013100 with the system\u2019s functions.
                        \nSystemization aims to improve current operations, but replacing the exact same flow offers little gain. More importantly, we prioritize users\u2019 feelings\u2014making \u201cthe process behind system results visible\u201d\u2014focusing on add-on user support rather than package customization. <\/p>\n

                        What\u2019s a Business System Suited to Indonesia?<\/h2>\n

                        To address Indonesia\u2019s visibility, mismatch, and disconnection issues, we must extract key requirements from operations shaped by unique internal cultures and implement them steadily in the system. <\/p>\n

                        \n\"End-to-End
                        \nRather than scratch-building everything, common system functions\u2014user permissions, master data management, Excel\/CSV export\/import, transaction tracking, and closing processes\u2014can be standardized.
                        \nPardon the self-promotion, but our company uses HanaFirst for management functions and Asprova for scheduling\u2014a best practice I propose to Japanese firms in Indonesia after 20+ years in the system industry.
                        \nSystems are a means to achieve business improvement, enhancing data entry efficiency and accuracy, and enabling effective info use through visualization, sharing, and systematization\u2014turning on-site data into competitive strength.
                        \nTo deliver visible results, we thoroughly hear customer requirements and focus on proposing systems that show how much operations improved and what new outcomes emerged.\n<\/div>\n","protected":false},"excerpt":{"rendered":"

                        All internal business operations are ultimately connected to revenue, which is the source of a company’s cash inflow, and purchasing, which is the source of cash outflow. When three key issues arise\u2014lack of visibility into the current state, discrepancies in figures, and a disconnect in process flow\u2014it not only reduces operational efficiency but also leads to a decline in employees’ awareness of sales and cost management.<\/p>\n","protected":false},"author":2,"featured_media":86794,"parent":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[633],"tags":[],"class_list":["post-94310","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-indonesia-production-control-system"],"_links":{"self":[{"href":"https:\/\/bahtera.jp\/en\/wp-json\/wp\/v2\/posts\/94310","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/bahtera.jp\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/bahtera.jp\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/bahtera.jp\/en\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/bahtera.jp\/en\/wp-json\/wp\/v2\/comments?post=94310"}],"version-history":[{"count":0,"href":"https:\/\/bahtera.jp\/en\/wp-json\/wp\/v2\/posts\/94310\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/bahtera.jp\/en\/wp-json\/wp\/v2\/media\/86794"}],"wp:attachment":[{"href":"https:\/\/bahtera.jp\/en\/wp-json\/wp\/v2\/media?parent=94310"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/bahtera.jp\/en\/wp-json\/wp\/v2\/categories?post=94310"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/bahtera.jp\/en\/wp-json\/wp\/v2\/tags?post=94310"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}