Rodamas Group: Designing Strategies in Erging Economies
Indonesia
Indonesia is a vast archipelago with a population of around 240 million, and has, over the years, experienced significant growth. Local partners were essential to manage the appropriate connections in a country that was rapidly developing but which still suffered from weak infrastructure, law enforcement, and rampant corruption, making every aspect of operations, including obtaining permits, buying land, hiring personnel, procuring inputs and distributing products, a challenge. The cultural diversity and geography for example, with hundreds of languages and islands, made it hard to distribute products and effectively market them. The low disposable income compared with the large population meant that there were large markets for products that catered to daily needs, such as food, clothing, soap, construction materials and other basic needs.
Rodamas
• Rodamas (which means “golden wheel”) was started by Mucki Tan’s father, Tan Siong Kie (hereafter Tan senior), in 1951 in Jakarta as Ho Hoa Trading Company Limited He had studied business and journalism in the university and this education proved very useful for his career as a businessman. It enabled him to communicate with international business owners and he understood international markets.
Indonesia under Sukarno
• Following independence, the country’s new Indonesian leaders, in particular President Sukarno, set out on a path of socialism and “guided” democracy. His policies, influenced by communism, were detrimental to the economy. During Sukarno’s rule, economic growth declined and inflation soared. Sukarno also implemented measures to restrict the economic activities of the ethnic Chinese minority, which played a major role in the private sector. In the years prior to the founding of Rodamas, Sukarno nationalized most foreign companies, which implied that many foreign mangers left the country
The environment
• For people like Tan senior,
Indonesia is a vast archipelago with a population of around 240 million, and has, over the years, experienced significant growth. Local partners were essential to manage the appropriate connections in a country that was rapidly developing but which still suffered from weak infrastructure, law enforcement, and rampant corruption, making every aspect of operations, including obtaining permits, buying land, hiring personnel, procuring inputs and distributing products, a challenge. The cultural diversity and geography for example, with hundreds of languages and islands, made it hard to distribute products and effectively market them. The low disposable income compared with the large population meant that there were large markets for products that catered to daily needs, such as food, clothing, soap, construction materials and other basic needs.
Rodamas
• Rodamas (which means “golden wheel”) was started by Mucki Tan’s father, Tan Siong Kie (hereafter Tan senior), in 1951 in Jakarta as Ho Hoa Trading Company Limited He had studied business and journalism in the university and this education proved very useful for his career as a businessman. It enabled him to communicate with international business owners and he understood international markets.
Indonesia under Sukarno
• Following independence, the country’s new Indonesian leaders, in particular President Sukarno, set out on a path of socialism and “guided” democracy. His policies, influenced by communism, were detrimental to the economy. During Sukarno’s rule, economic growth declined and inflation soared. Sukarno also implemented measures to restrict the economic activities of the ethnic Chinese minority, which played a major role in the private sector. In the years prior to the founding of Rodamas, Sukarno nationalized most foreign companies, which implied that many foreign mangers left the country
The environment
• For people like Tan senior,