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Accelerated digital transformation for Indonesia Industry 4.0

The Indonesian manufacturing sector is seeing comprehensive changes in businesses across the spectrum, that is leading to accelerated progress to Industry 4.0 standards. This increased pace is being driven by efforts to increase productivity, efficiency and safety to adapt to the new normal brought about by the pandemic. Speaking at a virtual event, Webinar of Industrial Powerhouse in the Making: Invest in Industry 4.0, Director-General of Resilience, Territorial and International Industrial Access (KPAII) of the Ministry of Industry, Dody Widodo felt that current transformation efforts are critical to encouraging economic growth and competitiveness of the country.

Digitisation and technology have brought a marked improvement in the productivity of the domestic manufacturing industry after being hit by the COVID-19. As of September 2020, the utilisation of the manufacturing sector reached 55.3%, an increase of 15-25% from the previous 30-40% at the start of the pandemic. He was confident that efficient and effective digitalisation would connect companies with domestic and international markets through an integrated supply chain network. Countries that have low transformation performance characteristics will face high costs due to unreliable capacity and efficiency, as well as major barriers to integrating and competing in global supply and value chains.

Dody acknowledged the undeniable role of the internet has had in changing the way of doing business, including in the industrial sector. Industry 4.0 is driving the increasing trend of automation, such as through the Internet of Things (IoT), machine-to-machine and human-to-machine interfaces, artificial intelligence, digitisation in manufacturing, and other advanced technologies. According to him, the new paradigm shift in manufacturing today is the result of the use of the internet which allows real-time communication between machines and humans- leading to an era of smart products and smart services.

To prepare for the Industrial 4.0 era, the Indonesian government has launched a road map for Making Indonesia 4.0. Initially, there were five sectors that received development priority – food and beverages, textiles and clothing, automotive, electronics and chemicals. However, learning from the pandemic, the Ministry of Industry has added two critical sectors to be included in the Making Indonesia 4.0 program – pharmaceutical industry and medical devices. With this, there are seven priority sectors.

These seven sectors are key sectors in the world economy and Indonesia is striving to become one of the major global players in these. The main goal is to have Indonesia in the top 10 countries that have the strongest economy in the world by 2030.

OpenGov Asia recently reported on the Ministry of Industry’s launch of the Startup4industry programme as another concrete step to implementing the Making Indonesia 4.0 roadmap. The nation is confident that this strategic initiative will bridge the needs of industry and the community with the role of startups as technology providers. Startup4industry, built on the theme “Indonesia Is Confident in Domestic Technology” 2020 aims to deeply technology to have a positive social impact on citizens and mitigate the impact of the pandemic in the industrial sector.

Investment in Industry 4.0 technology will increase competitiveness and added value and, to that end, the government has carried out various strategic activities as part of the implementation of Making Indonesia 4.0. These include 2019 Indonesia Industrial Summit, preparation of Indonesia’s 4.0 Industry Readiness Index (INDI 4.0), the IKM e-Smart program and the appointment of an Industry 4.0 lighthouse company in Indonesia.

To attract investment related to industrial technology 4.0, the Ministry of Industry has proposed various incentives for industry players, including a super tax deduction of 300% for industrial companies investing in R&D (including technology 4.0) and 200% for industrial companies investing in vocational education.

Further, to maintain business continuity of the industrial sector in the country, the Ministry of Industry has granted an Operational Permit and Industrial Activity Mobility (IOMKI) for business actors who meet the requirements based on Circular (SE) of the Minister of Industry Number 4 of 2020, SE of the Minister of Industry No.7 / 2020 and SE of the Minister of Industry No.8 / 2020. As of October 2020, 18,183 IOMKIs have been issued for various industrial sectors with total employment of 5.15 million people.

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CTC Global Singapore, a premier end-to-end IT solutions provider, is a fully owned subsidiary of ITOCHU Techno-Solutions Corporation (CTC) and ITOCHU Corporation.

Since 1972, CTC has established itself as one of the country’s top IT solutions providers. With 50 years of experience, headed by an experienced management team and staffed by over 200 qualified IT professionals, we support organizations with integrated IT solutions expertise in Autonomous IT, Cyber Security, Digital Transformation, Enterprise Cloud Infrastructure, Workplace Modernization and Professional Services.

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Planview has one mission: to build the future of connected work. Our solutions enable organizations to connect the business from ideas to impact, empowering companies to accelerate the achievement of what matters most. Planview’s full spectrum of Portfolio Management and Work Management solutions creates an organizational focus on the strategic outcomes that matter and empowers teams to deliver their best work, no matter how they work. The comprehensive Planview platform and enterprise success model enables customers to deliver innovative, competitive products, services, and customer experiences. Headquartered in Austin, Texas, with locations around the world, Planview has more than 1,300 employees supporting 4,500 customers and 2.6 million users worldwide. For more information, visit www.planview.com.

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SIRIM is a premier industrial research and technology organisation in Malaysia, wholly-owned by the Minister​ of Finance Incorporated. With over forty years of experience and expertise, SIRIM is mandated as the machinery for research and technology development, and the national champion of quality. SIRIM has always played a major role in the development of the country’s private sector. By tapping into our expertise and knowledge base, we focus on developing new technologies and improvements in the manufacturing, technology and services sectors. We nurture Small Medium Enterprises (SME) growth with solutions for technology penetration and upgrading, making it an ideal technology partner for SMEs.

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HashiCorp provides infrastructure automation software for multi-cloud environments, enabling enterprises to unlock a common cloud operating model to provision, secure, connect, and run any application on any infrastructure. HashiCorp tools allow organizations to deliver applications faster by helping enterprises transition from manual processes and ITIL practices to self-service automation and DevOps practices. 

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IBM is a leading global hybrid cloud and AI, and business services provider. We help clients in more than 175 countries capitalize on insights from their data, streamline business processes, reduce costs and gain the competitive edge in their industries. Nearly 3,000 government and corporate entities in critical infrastructure areas such as financial services, telecommunications and healthcare rely on IBM’s hybrid cloud platform and Red Hat OpenShift to affect their digital transformations quickly, efficiently and securely. IBM’s breakthrough innovations in AI, quantum computing, industry-specific cloud solutions and business services deliver open and flexible options to our clients. All of this is backed by IBM’s legendary commitment to trust, transparency, responsibility, inclusivity and service.

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