Research and Development Prototype Creation

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

The research and development activities are conducted in laboratory and plantation. The company also can make research collaboration with other parties such as universities and research institutions, it depends on the situations. Nowadays, the company already collaborate with the university so that a student from the university does a part of research. However, the focus of research is selected by the company, and it is usually a part of research that is contained in P3 or P4 group of Research Priority. With this strategy, the result of research can be used by the company to develop their innovation. 6 “We usually get stuck, our researchers, they do what they already know. They do not want the challenge, why? I also do not understand. If they do that kind of research challenger research, they will not graduate easily Liwang, 2015” However, the collaboration with other parties is very important especially to develop innovation in the downstream industry. Because, it needs a lot of money for conducting that kind of research. 7 But if we are reckless, there should be an institution that deal with the development of palm oil downstream industry. I saw Malaysia, and it is simple. The important thing is compact. For example, there is a budget, 10 trillion, for five years. So we use students. Developing from University, LIPI and BPPT is also support Liwang, 2015”

4. Prototype Creation

There are two types of research based on the industrial area: upstream and downstream. There are several examples of research in the upstream area such as efficiency in fertilizer, pesticide, and human resource. The palm oil industry is already established in this area of research because they already have a site to develop a prototype from their research. However, the industry still struggles in developing innovation for the downstream industry, such as developing equipment to process CPO into oleochemical or other downstream products. The problems happen because creating that kind of equipment need a lot of money. Indra from BBPT says: 8 “Rule of thumb says that scale up can only maximum up to 100 times. When entering that scale, there is no budget possibility anymore Susetyo 2015. Hambali 2015 from IPB says about the problem of creating a demonstration plant for palm oil downstream industry: 9 Biodiesel, we are starting from industrial scale, but it must be observed. For example, we want to make 100.000 ton a year. It is big, isnt it? Who want to finance it? The industry does not want to do that, so government should finance it Hambali 2015.

5. Implementation