Toward a public sector asset optimization strategy: the case of Indonesia

Abstract

PurposeGovernments in developing countries manage their considerable state assets for public service delivery directly. In Indonesia, the Directorate of State Asset Management responsible for developing the national strategy for state asset optimization requires the determination of key elements and prioritization tools. The purpose of this paper is to show that a simple calculation using the combination of the balanced scorecard (BCS) and analytical hierarchy process (AHP) will help in the prioritization of strategy development.Design/methodology/approachA questionnaire survey of 131 multistakeholder respondents to identify the most important key elements and the best alternative for asset optimization was done in this study.FindingsThe respondents agree on the most important key elements, and that the best alternative for asset optimization is the efficient maintenance of assets. Competitive human resources comprise the recommended second key element, and that improvements in asset performance and value will improve public service as the second-highest alternative. This study also shows the importance of the integration of asset optimization in existing government strategic instruments supported by a comprehensive data set related to public assets and their performance.Originality/valueThis paper provides a new contribution to integrating asset optimization strategies as the core of the organization’s performance and prioritization strategies. Additional BSC perspectives are suggested, with the inclusion of AHP for prioritization. In addition, this study includes the opinions of all the stakeholders, from external users to the central management. The flexibility of the tools to adapt to the existing strategic framework will allow their application by different agencies and in different countries.