Manufacturing Industry In Indonesia Research Articles

Oil Price Fluctuation and Their Impact on Indonesia Manufacturing Industry

This study analyzes the effect of crude oil price fluctuations using the model approach of Fukunaga et al (2009) where crude oil price fluctuations are influenced by several components such as oil supply shocks, global demand shocks, and oil-specific demand shocks. Then analyze the effect of each component on the aggregate industry production index, food, beverage and tobacco industry production index, chemical and goods from chemical raw materials, petroleum, rubber and plastic industry production index, metal, non-machinery and equipment production index. The research method is VAR in difference and the analysis methods are Granger causality test, Impulse Response Function (IRF), and Forecast Error Variance Decomposition (FEVD). Global demand shocks and oil-specific demand shocks have a significant and positive effect on crude oil prices, while oil supply shocks have no significant effect. Oil-specific demand shocks have a significant effect on aggregate industry production index variables, while oil supply shocks and global demand shocks have no significant effect. The decomposition variables of oil price fluctuations, namely oil supply shocks, global demand shocks, oil-specific demand shocks, have no significant effect on the food, beverage and tobacco industry production index chemical and goods from chemical raw materials, petroleum, rubber and plastic industry production index, metal, non-machinery and equipment production index of metal, non-machinery and equipment.

The Effect of Inflation, Exchange Rate, Labor and Money Supply on The Manufacturing Industry Sector in Indonesia 2011 – 2020

The manufacturing industry is the main supporting sector for the economy, considering its enormous contribution to Indonesia’s national GDP compared to other sectors. However, the economic problems lately have resulted in a decline in Indonesia’s economic conditions, which is marked by a reduction in national GDP and a decrease in the output of the Indonesian manufacturing industry sector. Thus, this study aims to analyze the effect of the complex variables in the current economy, namely inflation, exchange rates, labor, and the money supply, on the manufacturing industry sector in Indonesia in the long and short term. This study uses the ECM (error correction model) method in empirical testing. The data used is secondary time series data (quarterly) starting from 2011:Q1 – 2020:Q4; the data obtained comes from the Central Statistics Agency, Bank Indonesia, and the Ministry of Trade of the Republic of Indonesia. This study uses the Eviews10 application as an analytical tool. The analysis results conducted in this study show that the exchange rate and labor have a positive and significant influence on the manufacturing industry sector in the long and short term. The money supply has a positive and significant effect on the manufacturing industry sector in the long term only. Meanwhile, inflation has a negative but not significant effect both in the long term and short term. Of these critical variables, labor has the most crucial influence on the manufacturing industry sector. Therefore, the government needs to pay attention to policies related to labor as the main factor in increasing the output of the manufacturing industry.

The Management Compensation, Profitability and Environmental Performance Against Voluntary Disclosure: an Empirical Study on the Manufacturing Industry in Indonesia

The Management Compensation, Profitability and Environmental Performance Against Voluntary Disclosure: an Empirical Study on the Manufacturing Industry in Indonesia

Foreign direct investment, efficiency, and total factor productivity: Does technology intensity classification matter?

Purpose ― We examine whether the foreign direct investment (FDI) in promoting technical efficiency is controlled by the sector classifications based on the technology intensity (High Technology, Medium-High Technology, Medium-Low Technology, and Low Technology). Methods ― We use the Indonesian firm-level dataset of the large and medium manufacturing survey from 2007 to 2015 and employ the time-varying stochastic production frontier. Findings ― We reveal that FDI, technology intensity and absorptive Capacity significantly affect firms' production and efficiency. We also found that the Indonesian manufacturing industry from 2007 to 2015 experienced positive Total Factor Productivity growth, where High-Technology sectors experienced the largest magnitude among others. Meanwhile, technological progress stemming from FDI is enjoyed more by Low Technology sectors. Meaning to say, technology intensity classification does not matter to technological progress. Implication ― The host country's government should focus on industries with high technical capabilities to accelerate FDI gains for the firms. Simultaneously, human capital improvement also needs to be intensified, for instance, through training or human development, so that firms with lower technical capability can catch up and, consequently, receive similar benefits from FDI activities. Originality ― Our study accommodates the research gap by including the FDI effect in both productivity and efficiency in a single equation. Many studies merely categorize technology intensity following the stochastic production frontier estimation to obtain technical efficiency or TFP growth. In this sense, those studies did not control the impact of the technology-specific effect.

Total Factor Productivity Calculation of the Indonesian Micro and Small Scale Manufacturing Industry

The purpose of this research is to determine the total factor productivity (TFP) of Indonesia's micro and small-scale manufacturing industries. The production function estimation approach established by Levinsohn-Petrin as the basis for computing TFP is employed in this study, with value added as the dependent variable and the value of labor costs and capital value proxied by the value of investment as the independent variables. This study uses secondary data from the Central Statistics Agency (BPS), which includes 23 sub-sectors of Indonesia's micro and small scale manufacturing industries that are included in the 2-digit ISIC, with the exception of the ISIC code 19 sub-sector, and covers the years 2010 to 2019, excluding 2016. The TFP value in the micro-scale Indonesian manufacturing industry was often higher than the TFP value on the small scale, according to this study. This research also demonstrates that low-tech sub-sectors, such as the food processing industry, have low productivity. On a small size, the estimated TFP value shows a decreasing trend, but on a micro scale, the estimated TFP value indicates an increasing trend.

Total Factor Productivity Calculation of The Indonesian Micro and Small Scale Manufacturing Industry

The purpose of this research is to determine the total factor productivity (TFP) of Indonesia's micro and small-scale manufacturing industries. The production function estimation approach established by Levinsohn-Petrin as the basis for computing TFP is employed in this study, with value added as the dependent variable and the value of labor costs and capital value proxied by the value of investment as the independent variables. This study uses secondary data from the Central Statistics Agency (BPS), which includes 23 sub-sectors of Indonesia's micro and small scale manufacturing industries that are included in the 2-digit ISIC, with the exception of the ISIC code 19 sub-sector, and covers the years 2010 to 2019, excluding 2016. The TFP value in the micro-scale Indonesian manufacturing industry was often higher than the TFP value on the small scale, according to this study. This research also demonstrates that low-tech sub-sectors, such as the food processing industry, have low productivity. On a small size, the estimated TFP value shows a decreasing trend, but on a micro scale, the estimated TFP value indicates an increasing trend.

The Effect of Technology and Company Characteristics on Firm’s Survival: Case Study of Indonesian Manufacturing Industry

Facing globalization and industrial revolution 4.0 requires companies to continue innovation to maintain their existences. Innovation can be carried out well if the company can absorb and apply the latest technology to increase the efficiency of its business. Firms that are unable to adapt to technology will not be able to compete with their counterparts. Therefore, this research was conducted to see the effect of technology, the firm's characteristics (size and location), and productivity (productivity and company profit) on the firm's survival. Using logistic regression, this study shows that technology, the firm's size, and productivity have a significant positive effect on the firm's survival. The location has a significant negative impact on the firm's survival, and profit does not significantly affect the firm's survival. The Hosmer and Lemeshow Test show that the model used in this study is fit for estimating all variables.

THE EFFECTS OF JOB ROTATION PRACTICES ON EMPLOYEE PERFORMANCE: A RESEARCH ON JUNIOR MANAGERS, SENIOR OPERATION AND OPERATION STAFF AT THE DEFENSE MANUFACTURING INDUSTRY IN INDONESIA

The importance of the defense manufacturing industry for national integrity necessitates is inextricably inseparable from the critical role of employees in maintaining the output produced by the system, depicted through employee work performance, particularly in the Operations Division. Job rotation is widely included to maintain a high level of employee performance to deliver their utmost. This study aims to identify and analyse the effect of job rotation on employee performance; non-recursive influence between job rotation and employee performance of the operational division at a defense manufacturing industry in Indonesia, characterized by a downturn in employee performance. The method used in this study are Simple Linear Regression and Structural Equation Modelling (SEM) method to describe the relationship between the observed variables (indicators) and latent variables. The research technique used through library research and field research, including non-participant observation, interviews, and questionnaires using a stratified random sampling technique distributed to 133 respondents as Junior Manager, Senior Operation, and Operation Staff across seven divisions. The results showed that the job rotation variable had a positive and significant effect on employee performance. Job rotation is proposed to be improved, emphasizing skills development to increase employee performance, especially regarding the quality of work indicator.

Production process improvements to minimize product defects using DMAIC six sigma statistical tool and FMEA at PT KAEF

PT KAEF is one of the pharmaceutical manufacturing industries in Indonesia that produces various kinds of drug variants. Currently, PT KAEF is experiencing problems in the form of product defects that exceed the company’s standard, which is 1%. By using the DMAIC Six Sigma Statistical tool (Define, Measure, Analyze, Improve, and Control), it is possible to evaluate the possibility of failure of the production system so that the cause of each product defect can be identified and get the right problem-solving solution and with Failure Mode Effects Mode can be known the solutions for the priority problems. From the search results, it can be seen that liquid products are the products with the most defects, with the causes of defects caused by errors in work procedures and the use of old machines. From the improvement results, it was found that the level of product defects decreased from 2,26% to 0,93% or in sigma level increase from 4,18 to 4,46.

Evaluation of overall equipment effectivity in the cement manufacturing industry: a case study

Overall equipment effectiveness is one of the important tools to measure the productivity in the company. This research is based on a case study of cement manufacturing industry in Indonesia, especially in kiln machine. The research aims to investigate the six big losses. In addition, the calculation of availability components, performance efficiency, and quality rate are carried out. The fishbone diagram is also employed to identify the root cause of the problem deeply. The results show the biggest losses in the kiln machine are the reduced speed losses. Therefore, the availability component and the performance efficiency should be improved to increase the productivity and the efficiency in the shop floor. Some suggestions are presented such as make a better surveillance system, improve the planning of preventive maintenance machine, and replace the more sophisticated maintenance tools to facilitate maintaining the machine.

The Effect of Complexity and Work Motivation on The Performance of Minor Change-Scale Product Development Projects In Automotive Manufacturing Industry

The increasing market competition in the Indonesian automotive manufacturing industry requires automotive manufacturing companies to adapt to changes through product development activities. Unfortunately, failure in product development projects is still high. One of the possible key factors of a successful product development project is work motivation. Another factor that is suspected to affect is the complexity of the project. Therefore, this study aims to find the effect of work motivation and project complexity on product development project performance. The research was conducted on 94 members of product development project team in Indonesian automotive manufacturing industry with a minor change scale using purposive sampling. Data was collected through online questionnaire with a response rate of 65.7% and then analyzed using PLS - SEM. The results of the study showed that project complexity had a positive effect on work motivation and otherwise on project performance. On the other hand, it turns out that work motivation is not proven to affect the performance of product development projects in the automotive manufacturing industry in Indonesia.

The readiness of human resources and organization in implementing total quality management (TQM) in Indonesia’s manufacturing industries

Total Quality Management (TQM) is a method of organizational improvement that is quite widely used in the world. Unfortunately, there are still many failures in its implementation, especially in Indonesia, for many reasons. The aim of this study was to determine the readiness of organizations and individuals in implementing TQM and its influence on the quality performance in Indonesia's manufacturing industries. The sample of this research consisted of 48 employees from about 20 privately owned companies at Jakarta, Bogor, Depok, Tangerang, and Bekasi (Jabodetabek) areas, Indonesia. The data were collected through interviews and questionnaires, followed by statistical analysis with Structural Equation Modelling using Partial least squares (PLS) method. The results of this study indicated that, within the sector, the individual and organizational readiness in implementing TQM, as well as their quality performance, was found to be at a good level. Furthermore, the level of individual and organizational readiness in implementing TQM showed a significant effect on the quality performance, with the significance levels of 84% and more than 99%, respectively. Accordingly, 43% variation on quality performance was influenced by the individual and organizational readiness in implementing TQM, and the rest (57%) was influenced by other factors.

DAMPAK PANDEMI COVID-19 TERHADAP IMPLEMENTASI MAKING INDONESIA 4.0

The industrial revolution is a process of change in which human work in various fields is replaced by machines. Currently the world has entered the era of the industrial revolution 4.0 so that the process of producing goods or services is much more efficient than before. Therefore, since 2017 the Ministry of Industry has made a roadmap for the Implementation of Making Indonesia 4.0 to accelerate the development of the manufacturing industry in Indonesia. In the process of achieving this goal, Indonesia is one of the countries most affected by the COVID-19 pandemic which began in early 2020. The activity plans that have been prepared in the roadmap must be adjusted because most of their budget has been reallocated or refocused for handling the impact of the COVID-19 pandemic. -19, this study aims to determine the implementation of Making Indonesia 4.0 on the impact of the covid-19 pandemic in terms of policies and budget allocations. The method used is a literature study and descriptive analysis using quantitative and qualitative data types. Based on the results of the descriptive analysis, information was obtained that the 2020 budget allocation for the Implementation of Making Indonesia 4.0 included the refocusing of 63.4% of the initial ceiling. With this refocusing, it is necessary to reconstruct the national priority programs contained in the roadmap for the Implementation of Making Indonesia 4.0 and redesign. financing so that not all national programs use the state budget.

Pengaruh Foreign Direct Investment, Inflasi dan Nilai Tukar Terhadap Kinerja Ekspor Manufaktur di Indonesia

This research aims to determine the impact of foreign direct investment, inflation and exchange rates on the export performance of the Indonesian manufacturing industry. This type of research is a quantitative, descriptive and pertinent research method. The data used is the secondary annual time series data from 1980 to 2019, it will be obtained from relevant institutions. This study uses the multiple linear regression analysis model and the OLS (Ordinary Least Square) method to determine the influence of the independent variables on the dependent variables. The results of this study also show that foreign direct investment, inflation, and exchange rates have a significant impact on the performance of Indonesia's manufacturing exports. In addition, some: (1) Foreign direct investment has a positive and significant impact on the performance of Indonesian manufactured exports; (2) Inflation has a positive and significant impact on the performance of Indonesian manufactured exports; (3) Exchange rate There has been a positive and significant impact on the performance of Indonesian manufactured exports.

Implementation of Environmental Management System (ISO 14001) in Supporting the Achievement of Corporate Sustainability Performance in the Pulp and Paper Manufacturing Industry in Indonesia

Objectives: This study analyses the implementation of an environmental management system based on the ISO 14001 standard, which can support corporate sustainability performance in the pulp and paper manufacturing industry in Indonesia. This study discusses the results of previous researchers related to the implementation of environmental management systems in supporting the achievement of corporate sustainability performance. Research Methodology: The research method used is a case study approach in five organizations from three pulp and paper manufacturing companies in Indonesia that have implemented environmental management systems. Collecting data through a questionnaire completed by representatives from organizations across the companies studied. Findings: Management commitment and implementation of internal audits that focus on environmental management and activities are the main factors contributing to the achievement of environmental performance. Meanwhile, the achievement of environmental performance is influence by employees' increased competence in the environmental field, programs to reduce energy consumption, and hazardous and toxic waste. Practical implications: The implementation of an environmental management system supported by an increase in environmental performance can improve the company's reputation, process efficiency and compliance with environmental regulations and requirements, that three things contribute to company performance, especially in the pulp and paper manufacturing industry. Novelty: This research contributes to the concept of a strong relationship between the implementation of environmental management systems and environmental performance in supporting the achievement of corporate sustainability performance, especially in the pulp and paper manufacturing industry in Indonesia.

Macroeconomic, Corporate Fundamentals, Systematic Risk on Firm Value: Evidence from Indonesian Manufacturing Sector

This paper aims to study the connection between the effect of macroeconomics, corporate fundamentals on systematic risk, and the firm’s value of the Indonesian manufacturing industry listed on the Indonesian Stock Exchange period 2015-2020. A total of 522 object analyses in this study with the purposive sampling method. This paper found that the direction and magnitude of the impact of firm value depend on macroeconomic measurement variables: interest rates, exchange rates, and the company’s fundamental measurement variables: leverage and capital expenditure. The paper also found that the macroeconomic positively affects firm value, and leverage has a significant positive effect on firm value. At the same time, capital expenditure shows different results in response to the firm value, that is, negatively significant. In particular, a systematic risk as a mediating variable becomes a significant and positive driver of macroeconomics and leverage on firm value. However, different results indicate that capital expenditure negatively affects the firm value if mediated by the systematic risk. The implication of this research is beneficial to enable companies and investors to make the right analytical decision in the Indonesian capital market in this pandemic covid-19 situation.JEL: E43, G10, G32

RELATIONSHIP BETWEEN NUTRITION INTAKE AND THE FITNESS OF MANUFACTURING WORKERS IN INDONESIA

ABSTRACKIndonesia ranks fourth in the world out of 15 countries whose manufacturing industries contribute more than 10% to the Gross Domestic Product (GDP). Nowadays, one of the consequences of the rapid development of the manufacturing industry in Indonesia is related to work productivity. Each person's work productivity is not the same, one of them depends on the availability of nutrients in the body. Lack of nutritional consumption for someone from standard needs will affect health conditions, activities, and work productivity. Nutritional substances in workers also affect fitness in addition to other factors such as age, health status, nutritional status, nutritional status, gender, and psychological conditions. Based on the description above, it is necessary to study the relationship between nutritional status and physical fitness of workers in manufacturing companies in Indonesia. The study was cross sectional on 120 workers from 6 manufacturing companies in Indonesia which was conducted using cluster sampling. Assessment of individual characteristics was conducted by direct interview. Assessment of nutritional intake uses the Food Frequency Questionnaire (FFQ) and the results were categorized as appropriate and inappropriate based on the 2019 nutritional adequacy figure for the Indonesian population. The fitness assessment (physical capacity) used a six-minute walking test by an occupational specialist and was converted to Meters and categorized with a cut off of 4.5 Mets to be sufficient or insufficient. About one third of manufacturing workers were centrally obese. Characteristics The dietary intake according to the recommendation were only about 10%, namely the appropriate carbohydrate intake 11.7% (Frequency 8.46 times (533.22 gr)), suitable fat 12.5% (Frequency 2.75 times (57.14 gr)), and suitable protein 10% (Frequency 6.55 times (101.77 gr)). The physical capacity of manufacturing workers in Indonesia was categorized as sufficient as much as 75.8% of their workload. Factors that affect physical capacity, namely age ≥ 40 years have 4.37 times less physical capacity and protein intake affected physical capacity / fitness for workers (p = 0.02). About a third of manufacturing workers were centrally obese. The characteristic of food intake in accordance with the recommended nutritional adequacy of the Indonesian population was only about 10%. The physical capacity of manufacturing workers in Indonesia was categorized as sufficient as much as 75.8% of their workload. Factors that affected physical capacity were age and protein intake. Keywords: Food Intake, Food Frequency Questionnaire (FFQ), Manufacturing Worker, Fitness, Six-Minute Walking Test.

The influence of corporate governance on firm value: a case study in Indonesian manufacturing industries

This study aims to determine the effect of corporate governance on financial performance and financial performance on dividend policy, then examining the effect of financial performance and dividend policy on firm value. The research approach is quantitative with panel data type. The sample are companies listed in the manufacturing industries on the Indonesia Stock Exchange. This study found that independent commissioners' existence does not affect financial performance. The size of the board of commissioners, audit committee members, and the number of board meetings do not affect financial performance. The study also found that financial performance and free cash flow affect the company's dividend policy. Finally, the results show that financial performance affects firm value while dividend policy does not affect it. These results have theoretical implications for supporting agency theory. The independent commissioners will reduce conflict and thus improve the financial performance.

THE EFFECT OF IMPORTED INTERMEDIATE-GOODS FROM CHINA TOWARDS EMPLOYMENT AND WAGE OF MANUFACTURING INDUSTRY SECTOR IN INDONESIA 2011-2018

This study aims to determine the effect of imports of intermediate goods from China on the employment and wages in the Indonesian Manufacturing Industry. This study uses secondary data from Badan Pusat Statistik, with cross-section data consisting of 24 sectors of the Klasifikasi Baku Lapangan Usaha Indonesia (KBLI) and time-series data for 2011-2018. The analysis tool used is the Two-Stage Least Square (TSLS) with the random effect estimation model. Endogenous variables in this research are employment and wages. Exogenous variables in the study are imports of intermediate goods from China, female workers, college workers, and added value. The results showed that employment and value-added had a positive and significant effect on wages, while the import of intermediate goods from China did not have a significant effect on wages. Meanwhile, female workers, college-workers, and wages have a positive and significant effect on employment, while imports of intermediate goods from China do not have a significant effect on employment in Klasifikasi Baku Lapangan Usaha Indonesia (KBLI) sector.

The Relationship between Job Stress and Employee Performance in Manufacturing Industry in Indonesia

One-fourth of Indonesia's Gross Domestic Product or GDP is from the manufacturing industry sector. Indonesia's government has proactively encouraged companies to increase their production capacity to meet the global demands, leading to strong demand for employees to work harder, affecting the workers' health. Overwork is often associated with fatigue, stress, and various health problems. Moreover, stress due to excessive work is a general problem many industries face and frequently influences workers' performance. Therefore, this research intends to examine the relationship between work stress and workers' performance, particularly in the manufacturing industry in Indonesia. The sample data are collected from ninety-three workers at the staff level across various companies in the manufacturing sector. The relationships between the determining factors and the Employee Productivity are evaluated by using the multivariate regression analysis. At the correlation coefficient of 0.972, we found a statistically strong relationship between the work environment and Stress to the workers' performance. The condition of low performance is attributed to the non-standard working hours and low quality of the relationship between colleagues and their superiors. Finally, the research recommends improved management of workers' stress by companies involving the adoption of flexible working hours and better communication between parties via discussion forums and meetings. Therefore, employees will be more motivated to improve work productivity.