Perpustakaan Digital ITB

Indonesian paint market is one of the fastest growing markets in the world (CAGR 2009-2011 at 8.3 %) and the market still has huge potency to grow due to its high population, the average paint consumption per capita (PCP) still low at 2.8 kg/person (world PCP at 6-7 kg/person), and the continuing of its economic high growth rate. On the other side, paint companies are facing pressure on profit margin due to the intense competition and sharp increase of the key raw materials price (eg. TiO2 and binder). PT.SCI, a local paint company, has established in Indonesia since 1983. By 2010, SCI just accounted for 2.2 % market share, and its sales in 2010 just use 48.3 % of its total production capacity. From the external and internal environmental analysis concluded that the main problems (weaknesses) faced by SCI are the lack of advertising programs that cause low brand awareness of its products, and lack of high skills marketing human resources. The root cause of the problems is the absensce of strategic management processes at SCI. The purpose of this research is to propose the strategy formulation and the implementation plan through strategic management processes to improve SCI performance. This research is supported by primary data (structured and unstructured personal interview, questionnaire, and direct observations), and secondary data (market researcher data, supplier data, and literature review). The corporate strategy generated from SWOT matrix is “concentration (horizontal) growth strategy”. The alternative strategies to accomplish the growth strategy are generated through Ansoff matrix that include: market penetration, product development, market expansion to new geographical markets, and enter into industrial paint segment. The proposed business strategy is “differentiation” strategy via the superior of its distribution and delivery, products, and services. The functional strategy generated via TOWS matrix are categorized into marketing strategy, operation strategy, financial strategy, and human resources strategy. Through FGD, the decision of selected strategies and the implementation priority are: market penetration strategy, product development strategy, and market expansion to other geographical markets. The implementation of the selected strategies are through developing integrated programs and actions plan at each functional departments. The marketing programs are focused to increase its product brand awareness and increase sales via advertising, sales promotion and more focus in project channels. The operation programs are increase actual production capacity and establish efficient operation. The human resources programs are to provide the HR needed to execute the selected strategies and establish good HR management practices at SCI for the long-run program. Then, the financial program is raising external funds and manage funds efficient and effectively.