Finnish company Metso is a global giant with annual net sales of over 7.5 billion euros. Their industries include services in the process industries, including mining, construction, recycling, pulp and paper, power and oil and gas.
We met with Metso’s general manager for Indonesia, Mika Ollikainen, to talk about how Metso came to Indonesia and how important market is it for them.
Mika Ollikainen, for how long has Metso been to Indonesia?
We have been here for over 20 years already and since then Indonesia has been important market for us.
How satisfied are you with the result so far?
We are very happy. Based on our success in the last few years, we’re now looking at the further steps on how to build and strengthen our position in the market here.
We have at the moment about 55 persons working all together in Metso here, 35 out of them in in pulp, paper and power generation industries. We were about 20’s when I personally came here in 2007. I expect that we will continue on the same path.
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Indonesian pulp and paper industry
How competitive is pulp, paper and power generation industry?
Of course it is a competitive business. Electronic media has come and they have eaten paper consumption globally.
Nevertheless, in Asia and Indonesia for example there is still growth in the market. So this is one of the rare areas in that sense and it is basically emphasized the focus that we have here. It’s one of the real growth areas in pulp and paper.
In the power generation we have entered Asian market just a couple years ago and we also see a huge opportunity to grow here. There is a huge potential in the biomass based energy, and obviously in the coal based one. We expect a lot from the future and especially from power generation.
As Indonesia is also a strong nation with its domestic resources in the pulp and paper industry, there will be investments for sure.
Same as in the mining and the construction. The infrastructure construction has started to take off. Thus for Metso Indonesia is one of the most promising market globally.
Is Indonesian market dominated by local or foreign players?
Mostly we face global, international companies. Same guys we compete here with are also working in the South America, Europe and in US. Then there are quite many niche players, regional and global, in many segments where we are working.
There are few global companies that fight very hard for the market shares and especially for the big projects. On the other hand, being globally local is something that we have in our strategy.
We understand their needs in this market and also of course how to best support them in the big investment, where we talk about new power plants, pulp mills and mines. Being able to manufacture and having the services locally is a big benefit.
Doing business in Indonesia
As business leader, how do you find working in Indonesia?
From the business point of view I have to say I find it very interesting as in all areas this is really a growing market. There are new things happening very fast compared to most of the world.
This makes it exciting here and given the forecasts Indonesia has for future, there is no reason to expect anything else than that.
Secondly, I have worked more or less in all Asian countries with customers there. In that sense, I have to say that Indonesian people and the companies here, they are nice to work with.
If I compare to Thailand where I was before, I enjoy working with them, nothing bad about that, but I enjoy even more working with the Indonesian people somehow. They are more open which makes it easier to work as a foreigner here.
What’s the main difference between working in Thailand and Indonesia?
I think Indonesian people are a little bit more open. Somehow,they understand the mentality of the foreigners and can adapt with them so there’s no big barrier really. It feels like people here are used to international working environment.
If to compare Finnish and Indonesian business culture – what are the main differences and similarities?
Let’s say in Indonesia, the big corporation things are done more on the personal level and somehow people’s opinions and own sentiments influence much more how they make their decision.
They are more personal than in the Nordic countries. In Finland for example, the corporate culture is so much stronger and individuals have a little bit less role to play.
Here, you always have business leaders with very strong character. That’s actually one major difference to understand from the practical point of view while working here.
Mika Ollikainen meeting clients
Talking about business in Indonesia-what are industries or sectors where you see a lot of potential for foreign investors to get involved in nowadays?
For the industries where Metso is working I would say that the energy sector has good potential. Generally,it is big in the long run,I believe in utilization of biomass on the energy production but also for other purposes and I think Indonesia has a huge potential in that field to capitalize.
That’s something that foreign investors and companies with their technology can benefit and help that industry to grow here.
Infrastructure construction is another area that I look. And then I know being a Finn, I believe that Indonesia in the future will have strong telecommunication operations, IT companies. That’s another area where companies have a big future here.
What are the things the foreign business leaders and investors should look out for when investing in Indonesia?
You need to pay attention and be really careful about how you to do things. Understand the local regulations and requirements.
Seek advice about how to set up the business. There are places where you can meet other businessmen like EuroCham, AmCham. You can get stuck if you don’t understand how things are supposed to be done here.
How do you build your network in Indonesia? Golf seems to be important part of networking here.
Absolutely, I like to play golf as well. It’s a big part of fun in living in Jakarta. I try to play golf at least once a week. It’s a good place to meet new people.
We have very international group where I play. It’s a good way to connect and get to know people when you are there. I think in Indonesia, it’s one of the important things to learn and play here.
I remember when friend of mine came here few years ago, he didn’t play golf. After six months, he realised that he has to play golf to be able to meet with the people and connect with the people.