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More MSMEs encouraged to digitise in Indonesia

As global economies continue to recover from the far-reaching impacts of the COVID-19 pandemic, several governments are veering away from traditional operations and shifting their focus toward digital transformation. 

The Indonesian government is at the fore of this transformation. Last year, an aggressive rollout of tech-driven programmes were introduced and subsequently adopted by multiple organisations. Among these departments is the Ministry of Industry which announced plans to integrate a modern approach in its governance framework. 

From an auspicious finish during the previous year, the Ministry said it is continuing digital reformation not just to fast-track transactions within its workforce but also to provide assistance to startup businesses that are intent on expanding their consumer base and improving their products and services to be able to compete better globally. 

In a statement, the Ministry reiterated its call for Micro, Small and Medium Enterprises or MSMEs to transform by going digital. This initiative has been set forth early on last year and is inclined towards goals to develop the industrial sector by increasing efficiency in costs, energy and time through digitalisation. 

The Ministry added that it is holding more events this year which would set the stage for small businesses to showcase their products. One of these events is Startup4Industry, which was created pursuant to directives laid out under the Making Indonesia 4.0 roadmap.  

In 2020, several startup businesses in Indonesia participated in events held by the Ministry. Out of these participants, 20 were chosen to participate in the Expose Day, an exhibit where tech solutions offered by startup businesses in the country can be unveiled to the public. 

Gati. Wibawaningsih, Director General of Small, Medium and Miscellaneous Industries (IKMA) of the Ministry of Industry explained: “Expose Day is a show-off event for technology solutions made by Indonesian startups to the public and industry players so that the theme of the 2020 competition, which is ‘Confidence in Domestic Technology’, can be realised.” 

The Director General also noted that the Ministry extends assistance to MSMEs which can rank well in four aspects. These include business opportunities, technicalities, the feasibility of business implementation and impact on innovation. 

Tech startups have been on the receiving end of assistance from the government. With the onset of the pandemic and growing economic concerns globally, the Indonesian government is looking at companies that are able to introduce profitable technology that can be utilised in streamlining e-governance models. To emphasise this position, the Director General confirmed that one of the winners of the Startup4Industry is an enterprise specialising in the field of automation, information technology and digital control systems.  

Business owners in the country are getting more inclined to develop automation systems, as these programmes are seen to provide more efficient production processes. The central function of automation systems is to create control applications. They are particularly useful in running machinery and equipment in production facilities and factories. 

An automated system is made up of several customisable elements and functions. These functions are designed to perform specific and programmed tasks. The system is utilised so that operational and administrative tasks will be more efficient. It has since been used not just to operate machines in manufacturing but is now being used in the field of human resource development. 

As reported earlier by OpenGov Asia, several state-owned enterprises in Indonesia are trying out automation systems to boost efficiency in their operations. One of these firms is a forestry enterprise that uses a project with a built-in Enterprise Resource Planning (ERP) system. The firm uses the ERP programme to modernise operations by reframing its existing financial controlling and human capital management business models. 

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