PT PJB UPHT (EAST REGIONAL MAINTENANCE SERVICE)

STRATEGY TOWARDS AFTA

By: Arko Setiyo Prabowo 8914192ZJY, Arif Hariyadi 8409057JA, ZulQadri

Asadik 8915104ZJY

PT PJB Unit Pelayanan Pemeliharaan Wilayah Timur

Abstract

AFTA, begin in 2015, there is only single market and production base
within five elements, which are: free flowing goods, free service, free
investment, free capital and free competent workers. One of the infrastructure
that affects economic growth is electrical energy infrastructures, especially
power plant. In order to answer PLN mandate and succeed 35 GW power
plant, PJB should be prepared. In 2015 work meeting, BOD (Board of Director)
has been socialize PJBs strategies to seize the opportunity in 35 GW power
plant.

East Region Maintenance Service Unit (UPHT) specializing on

maintaining power plant through overhaul project. UPHT contribute on
maintaining three power plants within east region, UBJOM, and also non Java
power plants. Therefore, UPHT contribution for succeeding PJBs strategy to
seize 35 GW power plants has been increasing year by year. UPHT should
mapping its own Strengths, Weakness, Opportunities and Threats. By this
analysis, UPHT generate several work programs for pursuing AFTA and
increase competitiveness.

SWOT analysis of the UPHT in order to deal with AFTA already done.
There are 8 recommended programe based on MiniMax SWOT Matrix. Six
programs are on progress: Participation in HAPUA, cooperation with PJBS,
improve English proficiency, human resource planning, improving compliance
of standardization/regulation and improve man powers skills. Two programs is
recommendation for headquarter: strengthen PJBs branding and create
services company joint venture.

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1. Background

1.1.ASEAN Free Trade Area (AFTA)

AFTA is a trade block agreement by the association of South East

Asians Nations supporting local manufacturing in all ASEAN nations. The AFTA
agreement was signed on 28 January 1992 in Singapore and starting in 2015.
The AFTA agreement members consist of Brunei, Indonesia, Malaysia,
Philippines, Thailand, Singapore, Vietnam, Laos, Myanmar and Cambodia. The
main issue in AFTA is free trade, to increase ASEANs competitive edge as a
production base in the world market through the elimination of tariffs and non
tariff barriers within ASEAN to attract more foreign direct investment to
ASEAN. In AFTA, there is only single market and production base within five
elements, which are: free flowing goods, free service, free investment, free
capital and free competent workers.

1.2. Interrelationship Between Economic Activity and Electric

Power Consumption

Electricity, as a basic needs for Indonesian people will also affected by

AFTA. Below are Indonesias electricity condition a year before AFTA:

1. Indonesias electrical consumption ratio are 1000 kwh/capita, meanwhile

other AFTA country, for example Malaysia are 4000 kwh/capita.

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 Figure 1.GDP and Electric Power Consumption(Source:world bank)
2. Closer look from electricity supply, there are imbalance between supply and
demand of electricity supplies.

Figure 2.Supply and demand growth of electricity in Indonesia (source:

energy.org)

From figure 2, we can conclude that:

a. Power plant capacity is increasing 4% per years
b. Peak load is increasing 5% at the same year.
Meanwhile, electricity condition in several regions has been shown low level
quality of energy supplies. These are potential to disrupt economical activities
and social cause. According to Global competitiveness Report 2013-2014,
Indonesia has occupied 89 rank of electrical supply quality.

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 Figure 3.Quality of electricity supply range(Source: energy.org)
Better Infrastructure will brings economic growth. One of the
infrastructure that affects economic growth is electrical energy infrastructures,
especially power plant. Targeted investment in infrastructure can reduce
production cost, improve economic growth and stimulate competitiveness.

1.3. PJB and UPHTs Role to Support Electricity in Indonesia

Indonesian government targeted 97.8% electrification ratio on 2022. To

make it happen, PLN has been mandated to implement 10,000 MW phase I
and II crash program, 35,000 MW power plant project on 2015-2019, not to
mentioned initiatives to increase operational efficiency. Besides Java-Bali and
South Sulawesi, the whole area of Indonesia has been experience electricity
crisis (Indonesian legislation number 30;2007 about energy). Therefore,
Indonesian government commits to build new power plants which total
capacity 35,000 MW and 7,000 MW on grid within 5 years.

Talking about electricity business and AFTA not only talking about
Indonesias electricity readiness to face this free trade agreement, but also
talking about how PJB will read power station business opportunity across
ASEAN. Those electricity condition can be seen as an opportunity and threat
for PJB. Common question which show up lately is what about PJB readiness
towards AFTA.

PJB is a generating company, subsidiary of PLN. PJB currently managing

six existing electricity power station, two maintenance service units, operation
and maintenance power station service (UBJOM), andCNG plants. In order to
answer PLN mandate and succeed 35 GW powerplants, PJB should be
prepared. In 2015 work meeting, BOD (Board of Director) has been socializing
PJBs strategies to seize the opportunity in 35 GW power plants. Below are
those strategies:

1. PJB group should develop IPP consortium with proven partners

2. Solving non Java power plants problem, for example PLTU Belawan,
PLTU Amurang and PLTU Anggrek.

East Region Maintenance Service Unit (UPHT) specializing on

maintaining power plant through overhaul project. UPHT contribute on
maintaining three power plants within east region, UBJOM, and also non Java
power plants, for example PLTU Amurang, PLTU Kendari, PLTU Lahendong, and
PLTU Asahan. Therefore, UPHT contribution for succeeding PJBs strategy to

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seize 35 GW power plants has been increasing year by year. To support PJBs
strategy in 35 GW power plants, UPHT should mapping its own Strengths,
Weakness, Opportunities and Threats. By this SWOT analysis map, UPHT will
generate several work programs for pursuing AFTA and increase
competitiveness.

2. Objective

This paper aims are:

1. ConductUPHTs SWOT analysis towards AFTA.

2. Bringing alternative programs to stimulate UPHTs strengths and
opportunitytowards AFTA.
3. Bringing recommendations to overcome UPHTs Weakness and Threats
towards AFTA.

3. Discussion

3.1.SWOT Analysis

SWOT is an abbreviation for the internal strengths and weakness of a

firm and environmental opportunities and threats facing that firm. SWOT
analysis is widely used technique through which managers create a quick
overview of a companys strategic situation. The technique is based on the
assumption than an effective strategy drives from a sound fit between a
firms internal resources (strengths and weaknesses) and its external situation
(opportunities and threats).

3.2. PJB (PT. Pembangkitan Jawa Bali / Java baliGenCo) Road Map

PJBis one of the largest electric utilities in Indonesia. Its strategies to

compete in AFTA and maximize growth has been formulated in long-term
Company known as Goes-UP. For the next ten years, PJB Goals are:

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 Existing(2015) GROWTH Existing(2023)
1. Business Integrated Power Company*) Donwstream up Energy Company*)
to Upstream
1. PLN (Majority) 1. PLN (Majority)
2. Market GROWTH AREA 2. IPP ( Majority)
2. IPP (Minority)
3. International (Minority)

3. Capacity 1. Asset Owner : 6,977 MW 1. Asset Owner : 18,202 MW

2. O&M Services : 5,482 MW 2.6 x
2. O&M Services : 23,180 MW
3. EPC : 155 MW 4.3 x
3. EPC : 763 MW
4.6 x

1. Asset Owner : Rp. 23 T 1. Asset Owner : Rp. 60 T

4. Revenue 2.6 x
2. O&M Services : Rp. 5.9 T
2. O&M Services : Rp. 1.4 T 4.3 x
3. EPC : Rp. 0.9 T 3. EPC : Rp. 0.9 T
4.6 x
Funding Institution (Majority)
5. Funding PLN Independency PLN (Minority)

Head Office *** ) Strategic Holding ****)

6. Organization Operation to Strategic
*) Power Plant, O&M services, Stockist and EPC
**) Integrated Power Company and Primary Energy Holding Company
***) Asset owner, Manager and Operator Combined
****) Asset Owner : PJB Holding ; Asset Manager and Operator : PJB Group

Figure 4.PJBs Road Map 2023

To seize the opportunity in 35 GW, PJB has been arrange resource
preparation blue print, and also develop PJBs necessity mapping for business
group, resource and business models for the next ten years by strengthen its
subsidiaries (Rekadaya Elektrika, PJB Services, NII), Stockist, not to mention
human resource the concept of business group.

Figure 5.Company Development Concept

Info PJB, 92th edition, Faebruari 2015

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 To succeed PJBs Road map, strategies toward 35 GW and AFTA,
UPHT as PJBs maintenance service unit should also participate. One of
PJBs road map targets by 2023 is increasing its power plant capacity,
to achieve this targetbesides making the new ones; PJB should also
maintain its existing power plant. That will be maintenance services
unit jobs, especially UPHT and UPHB.

3.3. UPHTs SWOT Analysis Towards AFTA

To perform that job and contribute to PJBs Growth toward AFTA,

UPHT should analyze its SWOT.The mitigation and recommendation is
generated by MiniMax SWOT matrix.UPHTs MiniMaxSWOT analysis can
be describe below:

Table 1. MiniMax SWOT Matrix

Internal Strengths Internal Weakness
1. UPHT have proven 1. Lack of man power
experience about power Quantity
UPHT plant maintenance

STRATEGY 2. UPHT have been trusted 2. Man powers lack of

to maintain the power plant English proficiency
TOWARDS in PJB, PLN and several
AFTA other privat company
3. UPHT ever conduct 3. UPHT never conduct
maintenance project as a maintenance in ASEAN as a
Sub Contractor in ASIA main contractor
External maximize (S) maximize minimize (W) maximize
Opportunities (O) (O)
1. ASEANs economic 1. Actively participate in 3. Improve English
growth impact the the activities of HAPUA proficiency of man power
electrical needs of (Heads of ASEAN Power by English course and
all ASEAN Utilities /Authorities) sharing knowledge
2. Increasing cooperation 4. Coordinate with the
countries
2. increase of power in the maintenance headquarter for HR
plant quantity and project with PJBS planning
5. Strengthen PJBs Branding
growth
To the society to attract
competence people to
join PJB

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External Threats maximize (S) minimize minimize (W) minimize
(T) (T)
1. More competitors, 6. Improving compliance 8. Create services company
less market share with international joint venture with OEM
2. some of competitor
standardization and companies
are afiliate
regulation
company of power 7. Improve man powers
plant of OEM skills/knowledge
especially in specific
subject of power plant
maintenance with
training and certificate
expertize program

3.3.1. Actively Participate in the Activities of HAPUA

(Heads of ASEAN Power Utilities /Authorities)

HAPUA had a lot of activities on power plant on

operation and maintenance. There are some activities in
HAPUA such as benchmarking, training, seminars. Following
the conference we can compare the position or our ability to
other members. At the HAPUA forum we can also get the
update technology.

UPHT has sent participants to participate seminars and

knowledge sharing in the field of plant assessment in 10th -
12th June 2014. The theme of the event was Remaining Life
Assessment Seminar & Workshop. The event was organized by
HAPUA Working Group no.5 on Human Resource, and PLN as
host.UPHT sent 4 person: Arif Hariyadi (Metallurgy Aspect at
Boiler and Turbine), Riastanto Hari Wijaya (Non Destructive
Testing), Hasrinuksmo Nukiandi (Creep Damage), and Riyo
Purnomo (Generator & Transformer RLA). In the next period,
UPHT should be more active in other activities in the forum
HAPUA.

3.3.2. Increasing Cooperation in the Maintenance Project with

PJBS

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 Now days, PJBs subsidiary whose doing commercial
maintenance projects is PT PJB Services. Upon power plan
increasing, man power needs will also increasing. Lack of man
power in PJB Services can be supported by UPHTs man power.
This join commitment also including talent planning. It means
UPHTs young engineer can be deliver into UPHT and PJB
Services projects. Figure 5 shows the number of personnel
assigned to the PJBS project and in 2014 UPHT assigned 73
personnel. PJB and PJB Services man power availability can be
optimize by resource leveling, so that idle resource can be
minimize.

Figure 5. Personnel Assign to PJBS Project

3.3.3. Improve English Proficiency of Man Power by

English Course and Sharing Knowledge

Now days, UPHT has been hold English Fiesta to

improve UPHTs work force English proficiencies. English Fiesta
consist of four program, which is English Assessment, Walk
Around, English Champion and General English Class. These
events held regularly every weeks. UPHT using very interactive
methods to attract employees interest by invite competent
native speakers.

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3.3.4. Coordinate with the Headquarter for HR Planning

To increase UPHTs man power, HR department has

been doing departments mapping and workload analysis. The
results have been reported to head quarter. This year UPHT
purposes manpower devisit as Table 2 to headquarter.

Table 2. UPHT Manpower Deficit 2015

Structure
N Employe
Division Chart Position Requirement
o es Deficit
(BSJ)
1 Mechanic 43 49 6
2Electric 23 34 11
Instrumen
3 t 17 36 19
3.3.5. Strengthen PJBs Branding to the Society to
Attract Competence People to Join PJB

To get competent man power, PJB has to attract

competent fresh graduates and experts. Therefore, PJB should
strengthen its branding, for example by exhibit job fair
regularly in famous universities. Since the hiring authority is
the authorities of headquarter, UPHT suggested PJB branding
can be synergized with recruitment program.

3.3.6. Improving Compliance with International

Standardization and Regulation

UPHTs maintenance quality will be recognize by ASEAN

community if it achieve national and international standards.
UPHT is very familiar with SNI (Indonesian national standard) is
supremacy as Indonesian company. To achieve international
recognition, UPHT also use international standard as ASME,
IEEE, ISO and API. However, the level of understanding of
international standard should be increased.

3.3.7. Improve Man powers Skills/Knowledge Especially

in Specific Subject of Power Plant Maintenance
There are several ways to improve workforce skills.
There are knowledge sharing, training, certification, seminar
and learning assignment. Knowledge sharing can be used to

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 disseminate knowledge about everyday trouble shooting and
knowledge transfer between employees.
Knowledge sharing in UPHT can be as Community of
Practice and Peer Group Discussion. The number of title of
knowledge sharing can be seen on the table 2. UPHT on 2014
conduct training 78 program and 2015 propose 148 programof
training and certification.

Table 2. Number of Knowledge Sharing Title

No Type 2014 2015

(July- (January-March)
December)
1 Community of 23 Title 10 Title
Practice
2 Peer Group 33 Title 8 Title
Discussion

3.3.8. Create Services Company Joint Venture With OEM

Companies
OEM companies have advantages compare to Gen Co,
because they have detailed design and engineering
documents, so that they are tend to master their tools and
trouble shootings. In AFTA, because of free trade agreements,
working together with the competitor can be an added value.
Related to electric power plants maintenance services,
PJBheadquarter should review the possibility to form joint
venture with OEM Company. The purpose of joint venture is
mutualism. For example is knowledge sharing and transfer of
technology between two parties.

4. Conclusion

SWOT analysis of the UPHT in order to deal with AFTA already done.
There are 8 recommended programs based on MiniMax SWOT Matrix. Six
programs are on progress: participation in HAPUA, cooperation with PJBS,
improvesEnglish proficiency, human resource planning, and improving
compliance of standardization/regulation and improves man powers skills.Two
programsare recommendation for headquarter: strengthen PJBs branding and
create services company joint venture.

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