e-Commerce empowerment for SMEs Onno W. Purbo Independent IT Writer Onno@indo.net.id Indonesia

References Industry& Trade Cooperative & SME Post & Telecomm Statistical Bureau MASTEL APJII www.dprin.go.id www.depkop.go.id www.postel.go.id www.bps.go.id www.mastel.or.id www.apjii.or.id

Archive e-Discussion Mastel-e-commerce@egroups.com Ukmnet@egroups.com Asosiasi-warnet@egroups.com Asosiasi-warnet-broadband@egroups.com Genetika@egroups.com Telematika@egroups.com

Term of Reference Life-long learning and the training of information and communications technology professionals Skills retention strategies for trade administration agencies reliant on information and communications technology Collaboration with the business/private sector on skills development Development of skills required to assist APEC members to establish a more pro-competitive policy and regulatory environment Development of skills standards to support e-commerce

Overview

Current Indonesia Situation Population of 220 million people 90+ million labor force Only 3-4 million univ. grads IT penetration correlates to education level.

IT Infrastructure Condition 2.2 million PC 8 million lines (Telco’s “monopoly”). ~150 ISP (liberal / no monopoly) 150.000+ Telecommunication Kiosk 1200+ Internet Café Access point for 60-70% Indonesian users. 25.000 lines for connecting schools. 1.5 million Internet user Double every year. Hope to reach 20 million by 2004.

Business Structure ~40 Million Enterprises >98% SMEs

Industry Structure (BPS-KOMPAS 21-08-2000) Scale No.Firms No.Worker Rp. Billion Large-Med 22,997 4,214,957 264,270 Small 241,169 2,077,298 14,858 Household 2,501,735 4,075,763 11,312 Total 2,765,901 10,368,020 290,440

Focus on e-Impact

Identified Major Issues Social & Cultural Aspects Highly related to level of education. National movement on IT literacy. Enable the SMEs for high impact Knowledge Preferably in local language. Human Resource Teachers. Infrastructure Telecomm & Internet Access. PC / Computers.

Basic Belief Mass of qualified Human Resource is the key of success. IT Retention can only be maintained if: Demand side - Enough carrots in marketplace for such IT knowledge. Supply side - Abundant & accessible IT knowledge available at low & no cost. Regulatory & policy framework – Make sure it can be implemented - self-finance & sustainable. Language & number of literature would be the major barrier.

Challenges Simple policy & tech for high impact. Small IT Mass (0.5% of population) Low density: Information access facilities. Computer / PC Telecommunication infrastructure. Slow Distribution of Knowledge.

Example of Real Life Experiences Wayan, Bali & Lombok Share design with European Distribution. Sells their craft & art over the Internet. Anshori, Lampung Butterfly cultivation sell it at US$7 / cocoon. Jerry, Bandung Textile export via B2B marketplace (mailing list).

Real Life Skill Needed for SMEs Ability to Read & Write in English. Limited knowledge of Internet e-mail & Web Knowledge of B2B Markerplace mailing lists on the Internet Access to Internet Café / Kiosk ~US$1 / hour (affordable for most people) ~US$5 / month (e-mail only access).

Indonesian e-Environment

E-commerce Community Mastel-e-commerce@egroups.com Warta-e-commerce@egroups.com I2bc@egroups.com Indonesia Internet Business Community – I2BC Ukmnet@egroups.com Indonesian SMEs network.

Indonesian Internet Activities National IT Movement Telematika@egroups.com Genetika@egroups.com Internet Café Association Asosiasi-warnet@egroups.com Education Community Dikmenjur@egroups.com (vocational schools) Jii@isnet.itb.ac.id (rural islamic schools) Kopertis-iv@egroups.com (private universities) Idln@idln.itb.ac.id (digital library network)

Create Mass & Demand

Focus Tactical Activities Focus on Mass Centers Schools ~ 18 million students Univ ~ 5 million students Need only ~25.000 lines for schools. Internet & Telco Kiosk ~ 20-30M people Simple policy – high impact. Focus on simple EC mechanism Substitute Telp, FAX with E-mail / VoIP. Simple B2B community forum e.g. mailing list. Use conventional payment systems.

Focus Tactical Activities Build & Extend Regional Marketplace Aceh & North Sumatra with Singapore or Malaysia. North Sulawesi with Philippine. Maluku & Papua with the Pacific. Bali, Nusa Tenggara & Maluku with Australia If possible automate the transaction of their activities, e.g. using EDI.

Brief Infrastructure Strategies

Internet Infrastructure Liberalization of ISP ~150 license. 25.000 lines for educational sector 18 million potential internet users Require low cost internet appliance. Internet kiosk – self-finance Contribute 60-70% current users Require internet appliance / terminal. Corporate user – self-finance

Brief Knowledge Strategies

The Actor Small Medium Business & Industry. ~80 million workforce. 30+ million business entities. 2.5+ million industries.

Capacity Building Multiplying Effect Education Sector – ~20 million people. Sustainable community-based telecenters. Development Consultants / NGOs.

Real Example of Knowledge Tactical Aspects Knowledge Management Digital Library One way knowledge dissemination Two ways interactions

Knowledge Management Manual Translation Public domain IT Knowledge in CD-ROM. Digital Library Indonesia Digital Library Network http://digital.lib.itb.ac.id Indonesia Cyber Library Society – i_c_s@egroups.com

Knowledge Generation Encourage writers to put & publish their work in public.

One Way Dissemination ~20 dedicated IT magazines nationally. Reaches couple 100th thousands people. IT column in most newspapers. Reaches millions people. Public Domain Knowledge on Free CD-ROM. >100 title IT books in Indonesian Need more dedicated IT writers. MoST – Technology Kiosk. http://www.iptek.net.id http://www.citn.or.id

Two Way Interactions Egroups.com mailing lists. Seminar / Workshop Millenium Internet Roadshow – 15 cities 2-6 Internet Seminars / Week in various cities. Min. 2x / week – Internet Radio Talkshow Training for trainers / IT evangelists.

Summary Focus on SME Educational Sector as strategic entry. Proposed Major Strategies: Knowledge generation in local language Incentive for IT writer. Training for trainers / IT evangelists. Create knowledge infrastructure Adopt simple e-commerce mechanisms. Focus on maximizing economical impact.

Thank you