ad info

 web features
 magazine archive
 customer service
  east asia
  southeast asia
  south asia
  central asia

Web-only Exclusives
November 30, 2000

From Our Correspondent: Hirohito and the War
A conversation with biographer Herbert Bix

From Our Correspondent: A Rough Road Ahead
Bad news for the Philippines - and some others

From Our Correspondent: Making Enemies
Indonesia needs friends. So why is it picking fights?

Asiaweek Time Asia Now Asiaweek story


That's the new slogan at Telkom

Reform Can Asia radically overhaul its corporate landscape?

Highlights of The Asiaweek 1000

Acer Taiwan's high-tech player does a global recasting

Innovation Thinking your way out of trouble

Unions The dos and don'ts of layoffs and pay cuts

Dinosaurs Evolving isn't easy

Excess The region struggles with overcapacity

The Asiaweek 1000 Asia's largest companies

LIGHTS FLASH AND SCREENS flicker in the control rooms of Telekomunikasi Indonesia's Jakarta regional division. The banks of lights indicate the telephone connections of this city of 9.7 million people, the most profitable of Telkom's seven divisions in the vast Indonesian archipelago. If a problem is spotted, the company can immediately divert the calls to other exchanges to keep the traffic moving, explains Jakarta division chief Guntur Siregar proudly.

Service has become the byword for Indonesia's telephone monopoly, which traces its origins to the Dutch colonial era. But its most revolutionary period was in the relatively brief span (1992-1996) under former president-director Setyanto Santosa. He turned the company from a fusty government bureaucracy into a business (No. 609 on The Asiaweek 1000) without losing sight of its overriding mission to bring telephone service to all of Indonesia's 17,000 islands.

Santosa's strategy was three-fold. First he reorganized the company, reducing the 12 geographical divisions to seven. He granted five of them a joint venture with foreign companies in order to introduce some semblance of competition into what remains essentially a monopoly utility. The reorganization had the added advantage of reducing the number of expensive division chiefs, deputy chiefs and middle managers.

The director cut costs further through an early retirement program that shrank Telkom's staffing by 12% to about 38,000. "My purpose was not only to reduce people but to throw away the deadwood," Santosa later recalled. But he depended more on persuasion than the ax. He flew around the Telkom empire convincing employees that they need to prepare for competition. The move helped to improve productivity and increase profits (the company reported a figure of nearly $40 million for the first nine months of 1998).

In another important initiative, even as it looked like his days at Telkom's helm were numbered, Santosa oversaw the company's partial privatization. In late October, 1995 the government sold about a quarter of the company, retaining 76% of the shares.

His successor as president-director, Asman Akhir Nasution, has continued the company's focus on service. "We changed the culture of the company so that the people serve the customer rather than being served by the customer," he says. Today every Telkom employee spends two weeks on average training to improve service skills as well as keeping up with advances in technology. Those who are not willing to change are "free to leave Telkom," says the boss.

In addition, employees are given a goal. At Telkom they call it T-2001 (Target 2001), which aims to place the company in the ranks of world-class operators by that year. Whether the goal is restructuring, staff reductions or privatization these are only the tools. "The real target, is satisfying the customer. In competition, only the company that can do that will survive," says Santosa. And there is no end date for that.

- By Jose Manuel Tesoro/Jakarta

This edition's table of contents | Asiaweek home



U.S. secretary of state says China should be 'tolerant'

Philippine government denies Estrada's claim to presidency

Faith, madness, magic mix at sacred Hindu festival

Land mine explosion kills 11 Sri Lankan soldiers

Japan claims StarLink found in U.S. corn sample

Thai party announces first coalition partner


COVER: President Joseph Estrada gives in to the chanting crowds on the streets of Manila and agrees to make room for his Vice President

THAILAND: Twin teenage warriors turn themselves in to Bangkok officials

CHINA: Despite official vilification, hip Chinese dig Lamaist culture

PHOTO ESSAY: Estrada Calls Snap Election

WEB-ONLY INTERVIEW: Jimmy Lai on feeling lucky -- and why he's committed to the island state


COVER: The DoCoMo generation - Japan's leading mobile phone company goes global

Bandwidth Boom: Racing to wire - how underseas cable systems may yet fall short

TAIWAN: Party intrigues add to Chen Shui-bian's woes

JAPAN: Japan's ruling party crushes a rebel at a cost

SINGAPORE: Singaporeans need to have more babies. But success breeds selfishness

Launch CNN's Desktop Ticker and get the latest news, delivered right on your desktop!

Today on CNN

Back to the top   © 2000 Asiaweek. All Rights Reserved.
Terms under which this service is provided to you.
Read our privacy guidelines.