One thing that is often encountered in the consulting world is the challenge of conducting studies on completely new problems. In this case, “new” can mean something that has not been done for a previous client or a situation the consulting firm has never faced.
Of course, however much work has been done, it is unrealistic to expect a consulting firm to solely handle what it has done before. Through a systematic approach and focused research carried out by a skilled consulting team, a consulting firm can undertake a whole new job.
This has just been experienced by Kiroyan Partners. When the Government of the Republic of Indonesia promoted its infrastructure development program, the business world was motivated to participate in the implementation of projects in this field. The construction of roads and bridges, airports and seaports, power plants, have created high dynamics in related economic sectors and opened up new business opportunities.
Our client, let’s call it Company A, is a manufacturing company that produces materials that are much needed in civil construction. Prior to this, they marketed their products through distributors who used to serve the construction market for private projects.
As a business actor, of course the government’s infrastructure development program opens up opportunities that cannot be missed. The obstacle faced is that the government sector has not been touched so far, so our clients have absolutely no knowledge of the ins and outs of working on government projects.
We helped Company A by using the approach that Kiroyan Partners rely on in solving problems, namely Stakeholder Management. For this reason, we conducted a Stakeholder Analysis first before determining the most appropriate Engagement Strategy, along with Issues Management through monitoring and analysis of news as well as interviews with related parties.
In the context of this project, an understanding of the legal framework governing the financing and implementation of government infrastructure projects is needed. There are four sources of financing for infrastructure projects, namely State Revenue and Expenditure Budget (APBN), Regional Revenue and Expenditure Budget (APBD), State Owned Enterprises (BUMN) and the private sector, each of which has its own mechanism. Procurement procedures are determined by the sources of financing, and therefore there needs to be an understanding of this aspect so that the research becomes more meaningful and efficient.
After conducting literature research for three months equipped with media monitoring and interviews, we prepared a comprehensive road map for Company A in entering this new business segment for them. The procedure for procuring government projects is governed by very detailed provisions accompanied by a government bureaucracy, which procedures are certainly different from doing business with the private sector.
It also requires an understanding of various relevant government policies. Furthermore, it is very important to understand what political factors need more attention, such as the role of parliament. In the New Order period (1968-1998), infrastructure development also took place very rapidly, but its character is different from now.
At that time, many projects were funded by the World Bank and foreign assistance, whose procurement procedures were much different. The role of the House of Representatives, both at the central and regional levels, as a control institution over the executive, has not run optimally because at that time President Suharto was dominated, so that practically the legislative function was subordinated to the executive role.
Companies with experience in implementing infrastructure projects during the New Order era faced factors outside the technical aspects that were very different from today. Therefore, public affairs as a corporate function explores political, social and cultural aspects helps this different understanding.
Chairman & Chief Consultant, Kiroyan Partners
This article has been published in PR Indonesia magazine 43rd Edition, issued on Oktober 2018, page 56.
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