Irwan Hidayat: Keeps Sido Muncul ‘Dancing’

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The wrinkles on his face are becoming more apparent, and he is not quite as agile as he was a few years back. Indeed, this year he will turn 59. Still, he maintains his sharp business acumen and strong business drive. He is in every way as highly motivated as the generation below him. This gentleman is none other than Irwan Hidayat, president director of PT Sido Muncul, Indonesia’s largest producer of jamu (traditional herbal medicine) and herbal drugs.

In late 2006, Irwan proudly announced that the sales volume of Sido Muncul had almost doubled from last year’s sales figures. It was quite an outstanding achievement for an industry squeezed between the pharmaceutical industry and imported drugs, particularly those from China.

Under Irwan’s leadership, Sido Muncul has continued to experience highly significant development. As the third generation entrusted to take the helm of this family business, Irwan has to do more than just continue the traditions already established in the company. He is dealing with a much different situation and condition; likewise, customers’ demands are different. These circumstances have spurred him to look for breakthroughs so that jamu will be equal in prestige to pharmaceutical drugs, or can at least be an alternative panacea with tested validity and scientific properties. 

“Compared with the pharmaceutical industry, the jamu industry has a small market. However, a number of pharmaceutical companies also produce jamu. This condition has put us increasingly in a bind,” Irwan said.

Aware of this reality, Irwan said Sido Muncul had to make a breakthrough to survive and continue to grow. In 1997, when many industrial companies found it hard to survive in the face of the monetary crisis sweeping through Indonesia, Sido Muncul, instead, announced the construction of a factory with certification from a pharmaceutical company, and a laboratory standardized as a pharmaceutical laboratory.

Irwan did not stop here but continued to promote the quality of his products by obtaining various certifications required by the Health Ministry. In 2000, the Health Ministry issued Sido Muncul a certificate on Good Medicine Production Practices (CPOB). With this certificate in its possession, Sido Muncul is a step ahead of other jamu producers, most of whom only possess Good Traditional Medicine Production Practices (CPOTB). “We apply the same standards as the pharmaceutical industry,” Irwan said.

In addition, Sido Muncul is also progressive in improving the quality of its products. The company has endeavored hard to raise the image of jamu. Sido Muncul may be said to be two or three steps ahead of other jamu producers in introducing better products. A series of scientific tests are always conducted before a product is put on the market. “We have conducted all these scientific tests to gain consumers’ trust. Jamu is usually perceived as being traditionally passed down from one generation to another. Well, we complement the existing tradition with scientific tests,” he said.

One of the constraints hampering the development of the jamu industry is the low level of public trust in its products, Irwan said. Jamu is usually perceived as being unhygienic and having a lot of adverse impacts. Irwan expressed hope that the efforts that he has made will result in public trust in the jamu industry in general and Sido Muncul in particular.

However, Irwan long ago introduced various changes that brought significant improvement in the performance of Sido Muncul. In 1993, he learned a very valuable lesson. Many people said Sido Muncul products were bitter and not nice to drink, which was why people were reluctant to drink jamu. This reality made Irwan think hard about how to make jamu taste better. Finally, Sido Muncul changed the formulas of most of its products so that it could produce better tasting jamu. “Our innovation has enjoyed a very good response from consumers,” Irwan said.

Sido Muncul was encouraged by the results and strived to introduce more innovations in its products. Besides producing jamu, Sido Muncul now also makes pharmaceutical and food products, particularly candy. Their two most recently launched products, Kuku Bima Energi, which is an energy drink, and Sido Muncul Vitamin C 100 mg, are enjoying a very good market response. “This is the fruit of efforts made over a long period. Today the public has greater trust in Sido Muncul,” he noted.

Irwan believes that Kuku Bima Energi has a great chance of becoming the second biggest player in the energy drink business. “At present we are in third position and only slightly behind the product in second position,” he said, adding that the sales volume of Kuku Bima Energi is over 40 million packets a year.

Likewise, although it has been launched only very recently, Sido Muncul Vitamin C 1000 mg is enjoying a very significant sales growth. “We are sure this product has bright prospects,” he said.

In addition, in connection with the effort to build public trust in the jamu industry, the employees of the jamu company should have full trust in the company. “It is good public relations when the employees say that their company is good. If the employees have this belief, consumers can be influenced,” he said.

The present success of Sido Muncul, he said, is inseparable from the role of all its employees, who form the big family of Sido Muncul. Irwan always tries to pass down the corporate values in the company’s vision and mission to all its employees, numbering over 2,000 people. Irwan said they did not get special training on the company’s vision and mission. Like his grandmother before him, Irwan always tries to set a good example for his employees about the values developed in this company.

Although Sido Muncul has enjoyed one success after another, Irwan is still sober-minded. He said that a business had to be run with a conscience. He is very much aware of the social responsibility that Sido Muncul carries. That’s why the company has taken the initiative to sponsor the conferment of the annual Sido Muncul Award on an individual who endeavors to help the unfortunate, or to an individual concerned with and sensitive to social problems.

In addition, Sido Muncul continues to practice a tradition started as far back as 1991: a free post-fasting Lebaran homecoming program for jamu vendors. Jamu vendors, he said, constitute one of the spearheads of Sido Muncul so the company rewards them for all that they have done for it.

Talking about the future, Irwan said he had an ambition to make Sido Muncul a more developed company. All these years, he said, Sido Muncul has relied more on its profits in business development. That’s why this development is slow, he added. In addition, the risk is very big. That’s why Irwan has been considering making Sido Muncul a public company to obtain additional capital for expansion. “But everything is highly dependent on the condition of the macro economy. If the condition improves, we plan to conduct an IPO.” Irwan said. (T. Hidayat)  

The Jakarta Post, January 24, 2007

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