IV RESULT AND DISCUSSION
Research Question 1: What innovative strategies have business enterprises used in the palm
oil industry?
To answers the first research question, the research will use the model of the design process from Carlopio with several adaptations. The model of the
design process is suitable with the situation in developing innovation in the palm oil industry. Even though, I made several adjustments to the model especially
about the name of steps.
There are five steps in developing innovation, starting with idea generation, idea selection, research and development, prototype creation and
implementation steps. This paper will describe the activity in each stage based on interview result with experts.
Figure 8 Innovation Strategy in A Palm Oil Industry, Adapted from Carlopio,
2010. 1.
Idea Generation
The first step in developing innovation is idea generation, which defines the problem and questions the basic assumptions which surround it
Carlopio, 2010.The Company generates ideas to solve problems or to improve their system or products. In this study, ideas are generated from
problems in the market. Moreover, there are two types of market; Internal and external market. Innovation for Internal market includes reducing
production costs and improving product quality. Innovation for external market usually provides new products which have high demand in the
market. The research director of PT SMART Tbk said about internal market:
1
“However, we are in the plant company, we know where we go. I want to how using fertilizer as low as
possible. So, we set a target first. How to use fertilizer as low as possible, but with productivity as high as
possible. a Change the plant, b Change the
application, D Change the time Liwang, 2015”
Idea Generation Idea Selection
Research and Development
Prototype Creation
Implementation
And about the External market:
2
Now, we should open that market. Do not like nowadays We just think about monetary, lets develop
the downstream industry. The question is where we should sell the product. It is still a long process after
that. As a trader, we must calculate the trading aspect
first, who will buy the product? Liwang, 2015” Furthermore, they make a list of problems and also possible solutions
based on their discussion. After that, they use it as a basis for the second step of innovation management.
2. Idea Selection
There are many problems collected at an idea generation stage, but they also have many ideas to solve them. So, to make it more manageable,
they divide the problems into four categories based on priority, urgent-non urgent and direct - indirect. It can be seen in figure 1
Figure 9 Research Priority Matrix Based on the interview
P1: Direct and Urgent P2: Indirect but urgent
P3: Direct but Less Urgent P4: Indirect and Less Urgent
The ideas in group P1 are high priority ideas to be implemented in the research stage because they can solve the short term problem. The
example of this type of research is a fertilizing scheme:
3
“We want a plant that has efficient fertilizer, back again to direct and indirect. The direct solution is in
Fertilizing Technique Liwang, 2015” In Group P2 the solution has not direct interaction with the problem but it
can solve the problem in a different way. An example is research about microbes that effects the absorption of fertilizer in the plant.
4 So, what is the indirect solution? Oh, fertilizing is
not only chemical, but also need microbe Liwang, 2015”
The research in group P3 and P4 needs more time to get results; it cannot finish just in a year. But the research is still important because it
can solve the fundamental problems in the industry.
5
There is also a less urgent aspect, for example, how to make the plant more efficient? It needs a long time
sir. The research needs years from beginning until get the result Liwang, 2015
The research priority is used as a base for the RD department to conduct their research. Which problems need to be solved in the short term
and which ones for the long term.? What kind of resources is needed for the research, do they already have it? Or do they need to make
collaboration with other parties to solve the problems? Thus, matrix priority is very important for the company to optimize their resources.
Furthermore, research in the palm oil industry has moved from the first generation of innovation, technology push, into the third generation of
innovation, the coupling model. Based on Rothwell 2003, the coupling model is a combination of technological capabilities and market needs. It
can be showed from their strategy that divides the period of research based on urgent and less urgent. Urgent research is usually based on the problem
in the market both internal and external, while less urgent research is a combination both the market problems and providing new technologies.
Furthermore, the coupling model has a gate in every stage of activities. It is used to determine the output already meets the requirements or not. If
the result is already satisfactory, it will be brought to the next stage. If the result does not pass the requirements, the stage must be repeated. The
strategy helps the company to minimize big failure in the last stage because a failure in the beginning stage is better rather than in the last
stage.
Furthermore, dividing the research into two groups based on period, short and long period, is a good strategy for conducting the research. It
will produce innovation that solves both the urgent and less urgent problems. Finally, If we compare the strategy described above with theory
from Rothwel 1994, The strategy to develop innovation in the company is similar with the third generation of Innovation. They do not only
conduct research to solve the problems from the market but also produce new technology to improve the quality of products.
3. Research and Development
