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Indonesia: Myth and Reality in the Land of the Shadow Puppet Author(s): Lorna Wright Source: International Studies of Management & Organization, Vol. 24, No. 1/2, Research Sites: Considering Some Less-Known Locations (Spring - Summer, 1994), pp. 35-60 Published by: M.E. Sharpe, Inc. Stable URL: http://www.jstor.org/stable/40397266 . Accessed: 18/06/2014 22:58 Your use of the JSTOR archive indicates your acceptance of the Terms & Conditions of Use, available at . http://www.jstor.org/page/info/about/policies/terms.jsp . JSTOR is a not-for-profit service that helps scholars, researchers, and students discover, use, and build upon a wide range of content in a trusted digital archive. We use information technology and tools to increase productivity and facilitate new forms of scholarship. For more information about JSTOR, please contact [email protected]. . M.E. Sharpe, Inc. is collaborating with JSTOR to digitize, preserve and extend access to International Studies of Management &Organization. http://www.jstor.org This content downloaded from 62.122.78.49 on Wed, 18 Jun 2014 22:58:35 PM All use subject to JSTOR Terms and Conditions

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Page 1: Research Sites: Considering Some Less-Known Locations || Indonesia: Myth and Reality in the Land of the Shadow Puppet

Indonesia: Myth and Reality in the Land of the Shadow PuppetAuthor(s): Lorna WrightSource: International Studies of Management & Organization, Vol. 24, No. 1/2, Research Sites:Considering Some Less-Known Locations (Spring - Summer, 1994), pp. 35-60Published by: M.E. Sharpe, Inc.Stable URL: http://www.jstor.org/stable/40397266 .

Accessed: 18/06/2014 22:58

Your use of the JSTOR archive indicates your acceptance of the Terms & Conditions of Use, available at .http://www.jstor.org/page/info/about/policies/terms.jsp

.JSTOR is a not-for-profit service that helps scholars, researchers, and students discover, use, and build upon a wide range ofcontent in a trusted digital archive. We use information technology and tools to increase productivity and facilitate new formsof scholarship. For more information about JSTOR, please contact [email protected].

.

M.E. Sharpe, Inc. is collaborating with JSTOR to digitize, preserve and extend access to International Studiesof Management &Organization.

http://www.jstor.org

This content downloaded from 62.122.78.49 on Wed, 18 Jun 2014 22:58:35 PMAll use subject to JSTOR Terms and Conditions

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Int. Studies ofMgt. & Org.t Vol. 24, Nos. 1-2, pp. 35-60 M.E. Sharpe, Inc., 1994

Lorna Wright

Indonesia

Myth and Reality in the Land of the Shadow Puppet

Indonesia, a major Southeast Asian archipelago nation of over 13,000 islands, is a member of ASEAN (Association of South East Asian Nations), together with Thailand, Malaysia, Singapore, the Philippines, and Brunei. The main islands are Java, Sumatra, Kalimantan, Sul- awesi, and Irian Jaya, with about 60 percent of the population living on Java. Jakarta, in West Java, is the capital of the country, the largest city (population of over 7 million), and the primary business center. Re- gional business centers are Surabaya in East Java, Medan in North Sumatra, and Ujung Padang in South Sulawesi.

Indonesia has a population of 186 million, making it the fifth largest nation in the world. This population consists of 366 different ethnic groups, the largest being the Javanese (about half of the population), who also constitute the major group in government. The Chinese are a minority immigrant group who hold much of the economic power and

The author is Associate Professor of International Business and Organizational Behaviour and Director of the Centre for Canada-Asia Business Relations at Queen's University (School of Business, Kingston, Ontario, Canada K7L 3N6). The support of the Indonesian Institute for Management Development (IPMI) throughout the author's years of research in Indonesia is gratefully acknowledged. Some ideas in this article were discussed with Dr. Don Lecraw, IPMI/The Univer- sity of Western Ontario, and his insights are gratefully acknowledged.

The popular Javanese art form "wayang kulit," or shadow puppet play, holds some similarities to doing research in Indonesia. Shadow puppets are two-dimen- sional leather puppets intricately carved and brilliantly painted. They are manipu- lated by a puppeteer (dalang) from behind a screen with a strong light source throwing their shadows on it for the audience to watch. One watches the shadow, not the actual puppet. In research, it is wise to question whether one has tapped the underlying reality or the superficial shadow.

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36 LORN A WRIGHT (CANADA)

have traditionally been resented by the indigenous Indonesians or "pribumi."

Historically, Indonesia was made up of a patchwork of kingdoms, influenced strongly by India and Hinduism, followed by Buddhism; then Persia and Islam; and finally by the Dutch and Christianity around the end of the sixteenth century - all through successive waves of trad- ers. The Dutch trading activity led to over 300 years of colonization.

By the early twentieth century, several popular nationalist indepen- dence movements had started and came to maturation with the Japan- ese occupation during World War II. On August 17, 1945, two days after the surrender of the Japanese, Indonesia declared independence, although the Dutch did not concede sovereignty until 1949.

Indonesia's first leader was a charismatic nationalist, Sukarno, who held power until an unsuccessful coup against his government in 1965 started a process that ended with his ousting in favor of General Suharto, who was named president in 1968. Suharto has held power ever since.

The development of the country and its economy has always been a top priority with the present government. Indonesia is resource-rich, but it has one of the lowest wage rates in Asia. The government pre- pares a development plan, Repelita, every five years, indicating where it will be channeling its resources. (The present plan, Repelita V, runs from 1989 to 1993.) The government has made great strides in wean- ing the economy from its dependency on oil exports, and boasted a growth rate of 6.7 percent in 1993. The business sector is dominated by state-owned enterprises and conglomerates owned by the ethnic Chinese minority.

To counteract the influence of the Chinese, the government has recently been encouraging "pribumi," or indigenous Indonesians, to become more active in business by requiring local equity participation in foreign investment and by stimulating the Jakarta stock exchange to allow small investors (generally pribumi) access to shares in company ownership.

In addition to being ethnically diverse, as indicated above, Indonesia is also religiously diverse, encompassing Islam, Hinduism (mostly on the island of Bali), Christianity, and Buddhism (primarily among the ethnic Chinese population). Although the country is predominantly Moslem (88 percent), it is not an Islamic state. The government has paid great attention to separating state from religion.

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INDONESIA 37

With such a diverse population, culturally, religiously, linguisti- cally, and geographically, the government of Indonesia is understand- ably careful about anything, including research, that may have a potentially divisive effect on the nation. Anything that is viewed as having the potential to generate controversy is scrutinized closely and subject to constraints and restrictions.

Background research information

Language

The official language of Indonesia is Bahasa Indonesia. This is the language of the education system, and all who are literate (75 percent of the population) speak it, even if their mother tongue is different. Many upper-class Javanese of the older generation also speak fluent Dutch.

English is not in wide use in daily life, although most top-level government officials and senior businesspeople are comfortable speak- ing it. (This may not hold true for all senior Chinese businesspeople.) In addition, a growing number of young people have been educated in the United States and have a good command of English. Even with the people who speak English, however, it is good policy to avoid slang and jargon; to phrase questions in a simple, straightforward manner; and to check constantly that both sides have the same understanding of both the questions and the answers. A question should never be phrased using a negative, because the answer will be ambiguous. For example, if a businessperson does not have a branch in Surabaya, the question "You don't have a branch in Surabaya, do you?" will elicit the answer "No" from native English speakers, meaning "No, I don't," but may elicit the answer "Yes" from native Indonesian speakers, meaning "Yes, you are right. I don't have a branch there."

Most people in the middle-management ranks of both the private sector and the civil service do not have a good command of English, and if your research is at that level, it must be in Indonesian. This may necessitate the use of interpreters and/or translators. Translators may also be necessary since much information in many areas is available only in Indonesian. If one is looking at business history, sources may also be in Dutch.

For both interpreters and translators, the person must not only be

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38 LORN A WRIGHT (CANADA)

fluent in both English and Indonesian, but must be familiar with the terminology of the researcher's subject area. Indonesian creates some unique problems in that it is a growing language. New terms are con- stantly being created, particularly in the management field. This poses two problems. The first is that if someone has been out of Indonesia for a while, he or she may not be familiar with the new terms. On the other hand, someone who is very current with the new terminology may have outstripped the actual usage in the business community. One must exercise careful judgment.

In translation, the ideal is for translators to be translating into their mother tongue. Back translation is a common method used to check accuracy. However, Indonesian is not widely known or spoken by North Americans, or Europeans, so finding good translators who can go from Indonesian to English for back translation purposes is ex- tremely difficult. In my experience, there were more mistakes in the back translation of a questionnaire on attitudes to negotiation than in the original translation (Wright, 1991).

Employing Hofstede's (1980) suggestion of using a panel of bilin- gual speakers to check the original translation worked much better in this case, as was done in subsequent research. The panel scrutinizes the document sentence by sentence, with the researcher asking questions to ascertain that the meaning she or he intended is actually there. Speaking the language oneself is helpful, because even the panel can miss certain points. In my own experience, querying the meaning of certain words led to the realization that they did not, in fact, convey the desired meaning.

Certain important concepts will not have a one-to-one agreement. For example, "power" in the Javanese context is very different from power as a Westerner knows it (Djajadiningrat-Nieuwenhuis, 1987). Power in the West is something to strive for and use when one gets it. To a Javanese, it is an ascribed characteristic - one either has it or not, and no amount of striving will obtain it. There is only one concept in Indonesian to convey the two concepts of power and authority, which are different in English. Indonesian, on the other hand, differentiates between an agreement in principle and a signed agreement. The En- glish word "agreement" is ambiguous to them.

In choosing an interpreter, one must also bear in mind the people one will be interviewing. Age and status are respected in Indonesia. If interviewees are senior people, the interpreter should be older, and

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INDONESIA 39

well educated. On the other hand, that type of person may be intimidat- ing if one is interviewing factory workers, and might inhibit the infor- mation they are willing to give.

One should work with the interpreter beforehand to ensure that he or she avoids asking leading questions or supplying answers. This may happen if you are using a higher-status interpreter who feels she or he knows what the respondent meant, even if the respondent did not say it. There is also the danger of the interpreter substituting a more "polit- ically correct" answer for the one actually given. Embarrassing or confrontational questions are likely to be rephrased, with the danger of the meaning being lost. Construct your questions carefully so that they will not be construed in that fashion.

Since the quality of interpreters and translators in Indonesia varies widely, it is best to ask other researchers whom they have used and about their experience. Using upper-year or graduate students in eco- nomics or management is a possibility in some cases.

Government

The government is very supportive of research. Indonesia appears to have a higher commitment to research, particularly in the social sci- ence area, compared with its ASEAN neighbors (Morfit, 1980). AU government departments have a research center, as do all universities. There are private research institutes, such as CSIS (Centre for Strategic and International Studies) and LP3ES (Institute for Economic and So- cial Research, Education, and Information); however, it should be un- derstood that their definition of research is rather different from the traditional Western academic view. Almost all the research that is done in government departments is program evaluation or support for pol- icy. Most research at universities and private institutes is contract re- search. There is very little research done by academics out of interest or as part of their job as academics. There are several reasons for this.

The major reason is that research centers at universities are viewed as subsidizing the work of the faculties in which they are situated. Therefore, the research has to be funded as a way of subsidizing one's salary. One does not chose the project one works on, and it is more than likely that one will only work on part of a project - with resulting lack of continuity. What this means is that the results of most research projects are disappointing. Many of the most promising researchers are

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40 LORN A WRIGHT (CANADA)

appointed to positions within the government where they have many pressing duties that leave little time for research (Thee, 1991).

LIPI (Indonesian Institute of Sciences) is a semiautonomous gov- ernment body that engages in a wide spectrum of social science and economic research. It also oversees research done by foreigners. All foreigners must have a research permit from LIPI if they are doing dissertation research, or do not have a counterpart local institution, which must be a qualified tertiary-level institution.

The biggest consumer of social science research is the government, which also funds a large portion of it. (In Indonesia, universities are viewed as government bodies.) Government funding of research is project-oriented, rather than problem-oriented (Morfit, 1980), which means they are tied to specific development projects. Benchmark sur- veys, feasibility studies, and evaluations are the most common forms of research requested. This project orientation of most research fund- ing favors applied research over the more theoretical. There are very seldom funds for general research into more fundamental issues, and funding agencies looking for applied research do not have patience with researchers who want to look at broader, deeper, or more general issues.

Along with the project orientation, government research is tied to the annual budget cycle. It must be completed in the year funds are made available. International agencies such as USAID, CIDA, World Bank, and Asian Development Bank (ADB) also fund research, again on a specific project basis. Privately funded research is almost nonexis- tent. Indonesian university faculty who try to carry out research on their own almost always find it impossible to do so. Either the direct costs are too high or the opportunity costs of seriously pursuing indi- vidual research are prohibitive (Morfit, 1980).

What this means for a Western academic hoping to do some collab- orative research is that Indonesian academics are unlikely to agree, unless there is payment for them in it. This is understandable, when one realizes that academic salaries are extremely low, and that the emphasis in universities is on teaching. According to Morfit (1980), participation in research projects counts toward promotion for Indones- ian academics, but mere participation is sufficient. No distinction is made between active contribution and passive attendance at meetings. Thus, with the apparent lack of interest in the quality of research on the part of government departments and a weak professional community

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INDONESIA 41

of social scientists in general, there is relatively little incentive to strive to produce good research findings. Although Morfit was writing four- teen years ago, most of his comments are equally valid today, as Thee (1991) attests.

When asked to name prominent researchers in the social sciences, economic, and management fields, there are only a handful of names that are consistently mentioned, and immediately identifiable, such as Maeling Oey and Riga Adiwoso on the social science side; Panglaykim (until his death), Mari Pangestu, Anwar Nasution, and Thee Kian Wie in the economic sector, and perhaps Andreas Dan- andjaja or Ahmad Habir in the management area.

This gloomy picture is partly alleviated by two facts. First, there are now management institutes at the graduate level, not only as stand- alone M.B.A. schools, but also within national universities such as the University of Indonesia, Gadja Mada University, and the Bandung Institute of Technology, the three foremost universities in Indonesia. Second, young faculty members returning from universities in the West are endeavoring to continue researching in addition to their other duties, and are being aided in this attempt by research-oriented institu- tions such as IDRC (International Development Research Centre) and the new joint Ph.D. program in management for the ASEAN region, a program established by the Associations of the Deans of Schools of Business in ASEAN, and in Canada. The Canada ASEAN Centre in Singapore is also supporting academic research by ASEAN faculty. All of this should mean more opportunities for joint research with foreign colleagues as well.

Holidays and other difficult times for research

Since Indonesia is predominately a Moslem country, the Moslem holi- days are particularly important to bear in mind. The month of Ramadan, which is the month of fasting, should be avoided if at all possible when doing research in Indonesia. The actual dates move from year to year, but in 1994 it was February 12-March 14. The end of Ramadan, Lebaran, is a major holiday, analogous to the Western Christmas. Everyone who can, goes home. The Christmas-New Year period is another time to avoid, for similar reasons.

If one is hoping to include Western businesspeople working in Indo- nesia in the research, then July and August should be avoided, since

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42 LORN A WRIGHT (CANADA)

that is the period when most people take home leave. If government officials are part of the study, April should be avoided, as that is the end of the fiscal year and they are preoccupied with budgets.

Before arriving in Indonesia, one should also ascertain that a central government election is not imminent, since large gatherings are usually prohibited in the period preceding the election, permits are impossible to get, and it is more difficult to gain access to top-level people. (Elec- tions occur every five years, with the most recent being held in 1992.)

Ease of doing research

Travel to and from Indonesia is relatively direct and easy, although expensive. Travel within the country to the areas that would be of interest to management, organization, and/or business researchers is also quite easy. Air travel connects all the major islands, usually with several flights a day.

Travel within Jakarta itself can be problematic. Jakarta is a large city not only in population, but in area. Many offices are on the Jalan Thamrin-Jenderal Sudirman and Kuningan corridors, but others are in the older part of the city, Kota, and still others in the newer suburbs. Factories are all on the outskirts of the city or in nearby cities such as Tangerang. There is frequent public transportation, but only the very intrepid would venture on the Colts (minivans) or buses. A better solution is to hire a taxi or a car and driver for the time you need them. I do not advise driving oneself. Driving in Indonesia follows a more aggressive, offensive (as opposed to defensive) style than is the norm in either North America or Europe. Furthermore, being stuck in a traffic jam is commonplace in Jakarta, and if you have a driver, you can relax and get some work done.

Because of these frequent traffic jams, if one is interviewing, plenty of time should be allowed between sessions, particularly if they are across town. If using taxis, be aware that many drivers are relatively new to the city and frequently will not know any of the streets away from the main arteries. It is not uncommon for the driver to ask the passenger how to get to the destination (in Indonesian), so it is wise always to carry a map. Even if you do not speak the language, you can always point. Most drivers will have a few words of English.

As of April 20, 1992, for a trial period, the main streets of Thamrin, Sudirman, and Gatot Subroto have a "three-passenger" rule for private

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INDONESIA 43

cars from 6:30 A.M. until 10:00 A.M., so this should be taken into consideration if hiring a car. This three-passenger rule may be ex- tended to other thoroughfares after the trial period. The rule does mean that for taxis, traveling on the Thamrin-Sudirman route at that time is very convenient.

Jakarta boasts many first-class hotels at Western prices, and runs the gamut down to inexpensive guesthouses (45,000 rupiah a night or US$ 22.00). Most top-ranked hotels have an embassy rate, so it is worth asking your embassy's help in booking a room. For ease of access, it is advisable to stay in a central location.

It is also advisable to link up with an institution in Indonesia. Not only will this help in gaining access to research sites, but having access to printers, office supplies, and secretarial help for telephoning or mail- ing will make life much more convenient. The Indonesian telephone system is a major obstacle, since it can take several tries to complete one call. One can spend an entire day doing nothing but trying to contact one or two people.

If a foreigner is not collaborating with a local institution, he or she will need a research permit. This requirement is not as strictly adhered to if the research is concentrated in Jakarta, and in the top levels of the business community. However, I would strongly advise working with a local institution, since they can provide valuable support systems and advice.

Institutions such as IPPM, IPMI, Prasetya Mulia (stand-alone man- agement institutes), or the University of Indonesia (all in Jakarta), the Bandung Institute of Technology (Bandung), or Gajah Mada Univer- sity (Jogjakarta) are all possibilities. In Indonesia, as in most Asian countries, the easiest way to establish contact is to be introduced by someone. Cultivating the acquaintance of any Indonesian student of management or economics on your own campus is an excellent way to gain an introduction to an institution. Failing a personal introduction, writing directly to the head of an institute or to a faculty member who has similar interests to your own is another option.

Another, more expensive option is to go to Indonesia and introduce yourself personally to the director of the institute you have chosen. In- donesians are a hospitable people, and are likely to do their best to help you, if they like you and it is at all possible. They also respond better to face-to-face communication than to written communication. Letters and faxes can sometimes go a long time without being answered.

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44 LORN A WRIGHT (CANADA)

Be humble in speech when introducing yourself, but be sure that the status of your home institution and of your own position is evident on your name card and in your curriculum vitae. (Status is important in Indonesia, but boasting is not admired: the trick is to show the former without resorting to the latter.)

In terms of research facilities, do not expect to find all the latest journals. Most universities do not provide public access to library stacks. Journal collections in most institutions tend to be spotty. If you desire secretarial help, be aware that most secretaries use Wordstar rather than Wordperfect. Access to computers can usually be accom- modated, but most still use 5 Winch floppies as opposed to 3Vi-inch diskettes. If you have a laptop, it will make your life easier, but be sure you have a universal adapter, because the current in most of Indonesia is 220. (Central Sulawesi is 120.) Carrying your own cable to hook up to any available printer is also helpful, since the backs of printers tend to be more accessible than the computer end of the cable.

Pros and cons of research in Indonesia

There are many factors that make Indonesia an attractive country to do research in. A major one is that, in the management field, relatively little has been done. It is a great laboratory for observing the effects of government regulation and de-regulation on the economy and busi- ness, as the government has introduced several packages of deregula- tion since 1986. There is substantial foreign investment from Japan, Europe, the United States, and Australia, providing opportunities for comparison between different national groups, approaches, and sec- tors, as well as the opportunity to observe the effect on the economy.

Indonesia is a country on the verge of transition from a less devel- oped country (LDC) to a newly industrializing country (NIC), allowing researchers to compare it with the established NICs and to test hypoth- eses on what is necessary for economic takeoff. Comparisons with neighboring countries at a similar, or slightly more advanced (e.g., Thailand and Malaysia) stage in development also allow for develop- ing models and testing hypotheses.

Other exciting areas for research where little has been done are: • Comparing Indonesian organizations and their management

with Western ones;

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INDONESIA 45

• The impact of state-owned enterprises on the economy; • The effect of privatization; • The effect of the initiation of the stock exchange on the busi-

ness community and what transpires as closely held companies go public;

• Managing diverse work forces (this area of study might give some insights for North America, given the diversity in Indo- nesia);

• Indonesian women in management; • Negotiation styles; • The effect of the program for ASEAN Industrial Joint Ven-

tures; • The ASEAN Free Trade Agreement (AFTA); • The effect of the "growth triangle" (Batam-Singapore-Johore)

on not only the economies in the region, but on the strategies of individual firms;

• Research into consumer behavior and other types of market research (which are very rare as yet).

Areas that have already received research interest are political risk (Gregory, 1986), joint ventures (several studies in progress, including Gregory; Geringer; and Allen), technology transfer (Keddie, 1984; Thee, 1990), industrialization and trade (e.g., Poot et al., 1990; Sumitro, 1985), and countertrade (Lecraw, 1988). Research on the effect of government fiscal, monetary, and economic policies is also prevalent (e.g., Fane and Phillips, forthcoming; Kim, 1987; Myint, 1984; Nasution, 1983; Warr, 1984).

Difficulties

There are many logistical difficulties to doing research in Indonesia. These include the traffic in Jakarta, the overloaded telephone system, and the fact that letters are screened in many organizations and a questionnaire may not get past the gatekeeper.

The above are inescapable difficulties. In addition, you may encoun- ter such rare (one hopes) incidents as having your briefcase stolen. This happened to me: my briefcase, containing two weeks worth of notes and tapes, and all my documentation, was stolen from a locked car I was standing in front of for no more than five minutes. Advertis- ing in a popular, vernacular newspaper offering a reward for the return

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46 LORN A WRIGHT (CANADA)

of the case will sometimes bear results. You may get your documents back, minus any cash. (This strategy did not work for me. It could be that because there was no money in the case, the thieves threw it in a nearby canal in disgust. There was no local address in the case for them to approach the owner for a possible reward on returning the case, either.)

In some areas, such as joint ventures, foreign researchers have al- ready visited the most prominent companies several times, and the companies complain they never see the results of the research and may be reluctant to undergo yet another study.

Any researcher investigating a question concerned with financial issues is likely to have a more difficult time, since Indonesian compa- nies traditionally guard their books well and are extremely wary about allowing anyone access. There is fear of information leaking out to competitors or to the government. This may be changing somewhat as the number of publicly traded companies increases; however, these are still in the minority as the Jakarta stock exchange is in its infancy.

Researchers who want to continue doing research within Indonesia have to bear government sensibilities in mind, and avoid areas that are likely to be sensitive. Research in regional areas where there is a history of tension with the central government, such as Aceh or Irian Jaya, is more apt to be sensitive than in Java. Research into areas such as possible political patronage, corruption, and labor issues will be more sensitive than investigating FDI trends.

Specific research issues

Previous research

The most heavily researched area is the economic one. The Australians have been at the forefront here with people such as Hal Hill (1988, 1990a, 1990b) and Richard Robison (1986). There are probably more Indonesian researchers in this area than in the field of management, in large part because faculties of economics have a long history in Indo- nesia, but management studies in any coherent fashion are only a de- cade old. Of the five scholarly journals dealing with Indonesia (see appendix), three deal exclusively with the economy, and a good pro- portion of articles in the fourth deal with that subject. Industry struc- ture studies are common, including rice, oil, timber, automobiles, and textiles (Doner, 1987; Hill, 1990a; Maclntyre 1990; Tang 1988). For-

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INDONESIA 47

eign investment in Indonesia has also been studied (Hill, 1988; Lecraw, 1991; Pangestu, 1991; Ramstetter, 1991; Thee and Yoshihara, 1987).

Another commonly studied area is the effect of politics on business (Crouch, 1976; Maclntyre, 1990; Yoon, 1989). Indonesian researchers dealing with politics, such as Kuntjoro-Jakti (1981), are rare since this is a sensitive topic. Relations between the host government and multi- national corporations have also received a degree of attention (Japan- Asia, 1980; Khong, 1986; Thee, 1985). The study of small to medium-size companies has not received as much attention; a study by Chu-ki-ji (1981) is an exception. Entrepreneurship in Indonesia also deserves more attention.

The history of business groups in Indonesia is another popular topic, done either on a case-study basis or through an analysis of databases (Hill, 1990b; Sato, 1989; Yamazaki, 1980); along with the study of state-owned enterprises (Kubota, 1980; Panglaykim, 1982).

The area of joint ventures has recently seen a great deal of activity, but many studies have not yet been published. Ann Gregory is doing a comparative study of North American, European, and Japanese joint ventures in Indonesia; Nancy Allen is doing her Ph.D. dissertation at Harvard on the transfer of managerial skills in Japanese and American joint ventures; and Michael Geringer will be publishing on ownership and control issues. Gregory (1986) has also examined the issue of political risk in Indonesia.

Topics in the area of human resource management have not been studied to the same extent. This may be because this area requires greater researcher familiarity with the language because it represents a definite move into the arena of the worker, who is not comfortable with English and has no experience with, and is suspicious of, ques- tionnaires. Most of the other areas of research can be done either with statistical data bases, through interviews with the foreign partner, or through talking to top executives.

A failing of much of the research done by foreign researchers in the management area is that it relies heavily on one side of the story - usu- ally the foreign side. Even when the research includes the Indonesian side, it is often done in a foreign language. For example, Hofstede's (1982) study on Indonesian work values was conducted in English. When I duplicated the study as part of research on negotiations, I translated the questionnaire into Indonesian and obtained different re-

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suits (Wright, 1991). (It should be noted that language was only one factor affecting the results.)

Much of the research on the management side has been done with convenience samples. For example, the first study of women managers (Hof faith, 1989) chose the sample by asking people to recommend candidates for interview, and from names in trade journals and directo- ries. This sometimes cannot be avoided, because the data from which one can choose a sample is just not available - as in the above case.

Data collection

Researchers doing work that requires access to an economic data base will find that the quality of the work done by the Central Bureau of Statistics (BPS) has improved greatly since the 1970s. Population cen- suses, labor force surveys, and national socioeconomic surveys are readily available. Economic researchers familiar with Southeast Asia now rank the work of BPS among the best (Hill, 1990; Thee, 1991). However, comparing historical data must be done with care since there are problems with earlier years. Statistics on small and medium-size enterprises can be off from census to census, for example.

Data from the various regions are not always reliable. For example, women's contribution to industry may be underrepresented in census data because women frequently underplay their participation in man- agement and ownership of home industries, such as textiles, to male enumerators, and the unit may be listed as owned by the husband only (Price, 1983).

Annual income data may be unreliable as self-employed workers underreport in order to avoid taxes they fear may be levied on the information, or overreport as a mark of status, or just do not know but need to give the researcher an answer - any answer. This was my experience in gathering data from women traders and smallholders in one region of Indonesia.

These examples show that statistical data should be checked with an empirical sample for some indication of their reliability. Who has col- lected the data and how the data were collected will have an effect on the resulting numbers. When the researcher conducts the check (or collects primary data), care should be taken to choose a representative sample, to phrase questions as neutrally as possible, and to emphasize his or her independence. (Researchers not connected with the govern-

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ment in some form are rare in Indonesia.) The researcher should be sensitive to the nuances of gender and status differences and how they can affect responses as well.

The information from statistical data is not always in a form that is useful to the researcher. For example, pribumi and nonpribumi busi- ness ownership is not broken down within the "domestic private" cate- gory, and "private" has fuzzy boundaries too (Hill, 1990). The published tables of labor force participation do not always give the desired level of detail either. A management component has to be teased out from the "administrative" category in the published tables for data on the prevalence, or lack of, women in management positions in Indonesia (Wright and Tellei, 1994).

Other government agencies such as the Ministries of Industry, Agri- culture, and Mining, the Bank of Indonesia, and BKPM (the Capital Investment Coordinating Board) are also engaged in primary data col- lection. Care needs to be taken in using them, however. For example, there is a difference between the FDI statistics reported by BKPM based on investment approvals, from balance-of-payments statistics. Data on international trade are in disaggregated form, while FDI data are not.

There are little formal data available at the firm level - that is, with regard to size, structure, ownership, and so on - although informal data (word of mouth) are easily found and usually consistent from one source to another. This is particularly true of the large conglomerates.

In Indonesia, when one is studying management processes, it is particularly critical to specify what region and what ethnic group you are researching, because ethnic differences are great. Little has been done in this area of management and culture, and managerial styles, except for Hofstede (1982), Danandjaja (1986), Laurent (1983), and Soemardjan(1979).

Research instruments and methods

Questionnaire survey

Conventional wisdom maintains that you will only get a 10-15 percent response rate in Indonesia with a mailed questionnaire. This is often the case, but it is not invariably true. Indonesians do prefer face-to-face communication to the written word, but one can still get a satisfactory response rate from a questionnaire by bearing in mind the following

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points. (All of them were incorporated in the author's research on negotiation in Indonesia and yielded a 68 percent response rate [Wright, 1991].)

First, the language used should be Indonesian. Many questionnaires, even from Indonesian researchers, particularly from Western universi- ties, are sent out in English. Even for someone fluent in English, it is less of an effort to read and answer questions in the native language. All Indonesians who have gone through at least the primary grades of school speak Indonesian, and although the spoken language has re- gional variations, the written language is standard throughout the coun- try. Second, the questionnaire should contain a stamped, self-addressed envelope, to minimize the effort to return it. This initial mailing should be succeeded by at least two followup mailings. Third, the researcher should be associated with a prestigious local institution to give the questionnaire credibility, since status is very important in Indonesia. Being associated with a prestigious home institution also helps, but be aware that universities that are well known in one's own country may not be known in Indonesia.

Finally, the topic should be of interest to the respondents. Indones- ian businesspeople, in common with their Western counterparts, find anything that may have some practical benefit to them interesting. In addition, they are particularly interested in topics that will help them deal better with the foreigners with whom they do business.

If the questionnaire uses multiple-choice questions, there should always be an open-ended "other" choice in each category to allow for the fact that different cultures may consider different factors important than are shown in the American-based management literature.

Interviews

Gaining access to high-ranking government officials or top business leaders in Indonesia is perhaps easier than gaining access to personnel at a similar level in North America. However, after getting an appoint- ment, one may find it canceled if a government official has been called by the minister, or a business executive has to leave for a trip abroad suddenly. Allow for this and be persistent; persistence does have its re- wards. Access to employees at the worker level, in contrast, can be more difficult. There may be a worry that the research may be disruptive.

Nonverbal responses are very important, and small cues must be noticed. Javanese, in particular, do not like to embarrass someone by

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contradicting them or refusing their request, so they do not like to say "No." In addition, you are unlikely to get important information imme- diately. The interviewee is going to want to establish some basis for trust initially. It helps if you can be introduced by someone either local or foreign, who is known to, and respected by, the interviewee. "Face" and harmony are very important, and information that is likely to shake that image of harmony is not going to be forthcoming. You will have to probe delicately for it.

When interviewing people who consider themselves below the in- terviewer in status (for example, workers in a factory or small traders), you will find that the interviewee will try to give the response she or he thinks you want. You must take care to phrase your questions as neu- trally as possible.

Try to keep cultural bias out of your questions as well. For example, in my work on women traders and smallholders, one of the original questions asked was uDo you have any savings?" The word for savings in Indonesian carries the connotation of money only, which meshes well with the Western expectation. However, after all the women on the first day of interviewing stated they had no savings, the researcher probed a little deeper and discovered that although money was not saved as such, any extra cash was immediately used for buying live- stock which was sold when extra money was needed. That was their form of savings, but the original question would never have elicited that fact. The revised question became "What do you do with any extra money you get?"

Organizational documents

Indonesian organizations generate a great deal of paper. What is writ- ten, however, is not always accurate. For example, if one wants the list of attendees at a certain negotiating session, that list may exist, but the people on it may not all have been at the meeting. Trust has to be established before you will be allowed access to material. Also, most of the material will be in Indonesian. Financial information to which you are allowed access will be at the most superficial level, until an even deeper level of trust is established. (With the increase in publicly held companies - still a small minority - this may become easier, but financial information still cannot be taken with the confidence the same information would engender in North America.)

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Observation Observation has not been a frequently used technique in management research in Indonesia. My own research (Wright, 1991) is the only example I know of. Based on that one example, the opportunity to observe was initiated by the Indonesian side. They were very open to the procedure - in fact more open to it than the foreign side.

Observation gives an excellent opportunity to observe management processes in action. However, a caveat is that the observer brings his or her own biases to the observation, and the conclusions drawn may not be the same conclusions as those of the participants. For example, in the negotiation observation, the observer drew the conclusion that the foreign negotiator was bending over backward to close the deal, that he was being almost too flexible. However, in interviews with the In- donesian side after the conclusion of the negotiations, she discovered that in their view he was overly rigid. She and they had given salience to entirely different parts of the process. The danger with observation is that there will be no followup interviews. These are particularly important when dealing with another culture.

Experimental research

There is no tradition of experimental research in the social sciences in Indonesia. To conduct an experiment would require time and a process of explaining what you were trying to achieve. If your subjects were taken from university students, they might understand and cooperate. You would run a risk of meeting with suspicion elsewhere.

Case research

In contrast to experiments, there is a strong tradition of case research. Some of the research consists of just one descriptive case (Stoever, 1981; Yamazaki, 1980), but the more valuable studies compare several cases. Cases have seldom been chosen in a quasi-experimental way (i.e., with rival hypotheses in mind and controlling for them as far as possible) when researching Indonesian companies. There has now been enough research to make this method of choosing cases to re- search highly advisable, rather than adding just another case history.

Other issues of interest

The use of Western-based models for explaining values, attitudes, and managerial behavior is questionable in Indonesia. Factors that we may

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INDONESIA 53

not have considered may be the important ones there. For example, we study "conflict resolution" but in a society that values harmony, tech- niques of conflict avoidance may be more salient. In Indonesia, the image of manager as warrior or as delegator may be overshadowed by the manager as father ("bapakism").

Longitudinal research is feasible in Indonesia, but not easy. Most organizations have a high turnover of staff. You cannot rely on having the same counterpart work with you throughout a period of several years. If you are using data bases, conducting longitudinal research from the mid-1980s into the future is quite feasible. However, if you want to go back in time, the earlier data are much less reliable and less complete.

Researchers may face ethical dilemmas in Indonesia. For example, what do you do if you uncover evidence of corruption? If you find evidence of worker mistreatment? If your conclusions are uncompli- mentary to powerful elites? Or if your research would jeopardize a possible business deal?

The first three questions are perhaps more prominent in Indonesia than they would be in more developed countries. The last is a dilemma anywhere. There are no clearcut guidelines to follow. Researchers have to use their own judgment.

Two scholarly publications dealing with the Southeast Asian region in the management area are the Journal of Southeast Asian Business from the University of Michigan (now expanded and renamed the Journal of Asian Business), and Asia Pacific Journal of Management from the National University of Singapore. Asian-Pacific Economic Literature from the Australian National University gives an annotated list of books and abstracts of journal articles published in management and economics. Most journals with a specific Indonesian focus are essentially economics oriented. They can be found in the appendix, with a list of trade magazines and other information sources.

Conclusion

The area of management research in Indonesia is relatively new, but interest in the subject is developing rapidly, if the spate of new maga- zines devoted to the topic is any indication. A second indication is the number of reference books that are appearing on companies and execu- tives. However, actual research is still hard to come by at the level of

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54 LORN A WRIGHT (CANADA)

the company or the individual manager. This means that there is plenty of scope for researchers. The field is wide open, with topics ranging from conceptual pieces on whether there is a unique In- donesian management style, or whether Western-based theories apply, to empirically based studies to ascertain just exactly what is happening in the field.

Consider investigating management in the field, or testing specific hypotheses. Some possibilities are:

• How do Indonesians negotiate? • How do you manage for quality in an LDC such as Indonesia? • How do you manage an Indonesian work force when you have a

supervisor from Singapore or Korea who does not speak Indonesian and does not know the culture?

• What are the attitudes of the Indonesian workers to supervisors from different countries? This was touched on by Everett et al. (1984) in Through a Glass Darkly, where they reported on the attitudes of workers in several Southeast Asian countries towards their Japanese managers.

The economic literature has a longer tradition, with both foreign and Indonesian researchers. Sector studies and studies of foreign direct investment are common. Comparisons with other countries in the re- gion are also made.

Some areas of particular interest are the effect of government poli- cies on promoting pribumi businesses; the impact on the business envi- ronment when President Suharto gives way to another leader; the success rate of ASEAN industrial joint ventures, and the effect of the ASEAN Free Trade Agreement (AFTA) which went into effect Janu- ary 1, 1993.

It is clear that there is plenty of scope for research. The major difficulties are time, expense, designing a project so that it is not ham- pered by cultural biases or preconceived notions, ensuring that transla- tion is done well, and analyzing data bases carefully before relying on them too heavily. Once these difficulties are recognized and overcome, you can more clearly distinguish myth from reality in Indonesia, and should be able to conduct research well in the land of the shadow puppet - a land that holds increasing interest for both Western re- searchers and Western businesspeople.

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INDONESIA 55

References

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. Monthly issues. Buletin Ringkas BPS (Abbreviated Bulletin of the Cen- tral Bureau of Statistics). Jakarta.

. Monthly issues. Indikator Ekonomi (Economic Indicators Statistical Bul- letin). Jakarta.

. Annual issues. Statistik Indonesia (Statistical Yearbook). Jakarta. Ciptawidya Swara, eds. Top Eksekutif Indonesia, vol. 1. Jakarta: Ciptawidya

Swara, 1992. Chusho Kigyo Jigyodan, Jyoho Chosabu (Chu-ki-ji). Chusho Kigyo Kaigai Toshi

Patonasu Chosa: Indoneshia (Survey of Local Partners for Small and Medium Size Enterprises in Foreign Investment: Indonesia). Tokyo, 1981.

Crouch, Harold. "Generals and Business in Indonesia." Pacific Affairs, 48 (1976), 519-540.

Danandjaja, Andreas. Sistem Nilai Manajer Indonesia. (Value System of Indones- ian Managers). Jakarta: IPPM, 1986.

Djajadiningrat-Nieuwenhuis, Madelon. "Ibuism and Priyayization: Path to Power?" In Elsbeth Locher-Scholten (ed.), Indonesian Women in Focus. Dordrecht, Holland: Foris Publications, 1987.

Doner, Richard Frederick. Domestic Coalitions and Japanese Auto Firms in Southeast Asia: A Comparative Bargaining Study. Ph.D. dissertation, Univer- sity of California, Berkeley, 1987.

Everett, J.E.; Krishnan, A.R.; and Stening, B.W. Through a Glass Darkly: South- east Asian Managers Mutual Perceptions of Japanese and Local Counter- parts. Singapore: Eastern Universities Press. 1984.

Fane, George, and Chris Phillips. "Effective Protection in Indonesia." Bulletin of Indonesian Economic Studies, forthcoming.

Gregory, Ann. "Comparing Normative Prescription and Reality in Political Risk Management: The Case of Canadian Firms with Ventures in Indonesia." Paper presented at the Academy of Management Conference, August 1986.

Hill, H. roreign Investment and Industrialization in Indonesia. Singapore: Oxford University Press, 1988.

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Hoffarth, Victoria B. Corporate Women Managers in Southeast Asia. Manila: Asian Institute of Management, 1989.

Hofstede, Geert. Cultural Pitfalls for Dutch Expatriates in Indonesia. Jakarta: Tventer, 1982.

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Industrial Managers in Southeast Asia). Tokyo: Institute of Developing Econo- mies, 1980.

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Appendix: Sources of Information

Scholarly journals

Bulletin of Indonesian Economic Studies, Australian National University, Canberra.

Ekonomi dan Keuangan Indonesia (Economics and Finance in Indonesia)

The Indonesian Economy, Centre for Policy Studies (monthly, with an annual review of the economy every January).

The Indonesian Quarterly, CSIS. Prisma, LP3ES

Popular magazines (in Indonesian, except where indicated)

Economic and Business Review Indonesia (in English) (began 1992)

Eksekutif (began 1980) Karir (a marketing magazine) Manajemen (began 1980) Manajemen dan Usahawan Indonesia (began 1971) Swasembada (began 1985) Warta Ekonomi (1981)

Newspaper

Bisnis Indonesia (began 1985)

Other sources of information

There are several written sources of raw data in Indonesia. None can be recommended as totally accurate. Biro Pusat Statisika (Central Bu- reau of Statistics) is the best and publishes yearly and monthly bulle- tins covering the economy in general {Indikator Ekonomi) and such areas as employment figures, industry sectors, etc.

Pusat Informasi Bisnis Indonesia (Indonesian Business Data Centre)

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INDONESIA 59

run by Wibosono, publishes a monthly magazine, Informasi, which provides economic and business information. It also publishes refer- ence books on the business community, for example, Multinational Conglomeration Indonesia: A Profile ofMNCs Presence in Indonesia.

Kompass also publishes reference books that list trading companies with their executives. Recently several books have appeared of a Who's Who nature, giving information on top businesspeople and ex- ecutives, for example, Top Eksekutif Indonesia. However, most of them are written in Indonesian.

Indonesian Development News is a bimonthly publication put out free by Hill & Knowlton, who represent the Indonesian government in public relations. It is a compilation of development news with informa- tion on business and industry, banking and capital markets, and the economy in general. Items of a controversial nature seldom appear here.

Infobank is a weekly publication containing clippings from newspa- pers with regard to the banking industry. Dokumentasi Kliping Tentang Dunia Ekuin dan Perbankan is a monthly publication offering a sim- ilar service, published by the Centre for Strategic and International Studies (CSIS). Both publications are in Indonesian. Statistik Ekonomi Keuangan Indonesia (Indonesian Financial Statistics) is published by Bank Indonesia monthly, and is bilingual.

Business News is a more broadly focused publication and bills itself as "Facts, analysis and information especially for entrepreneurs, man- agers, officials, politicians, technocrats, and scholars." It is published in Indonesian on Monday, Wednesday, and Friday, and in English on Wednesday and Friday. It usually includes the transactions of the Ja- karta stock exchange, an editorial, exclusives (which are snippets of current news), government regulations, outlook on economic problems (e.g., more in-depth treatment of a specific issue such as a BPS study on tourism, and the priority direction of industrial development).

Prisma is published by LP3ES (Institute for Economic and Social Research, Education, and Information) on a monthly basis in Indonesian and occasionally in English. (It used to be quarterly.) It includes summa- ries of research and surveys, hypothetical analyses, and original ideas in the areas of economic growth, social development, and cultural change.

Various consulting firms also produce information newsletters such as Indonesian Commercial Newsletter, and Business Report: In- docommercial.

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Indonesian Capital Market Journal began in 1990, giving an eco- nomic overview, industry profiles, company profiles, and economic and financial indicators.

IPPM (Institut Pendidikan dan Pengembangan Manajemen) is a management institute that also does contract research. It maintains a library that is perhaps the best for management in Indonesia. LIPI (Lembaga Ilmu Indonesia) is a semiautonomous government body that carries out research and gives out permits for foreigners to carry out research. It also maintains a library. CSIS (Centre for Strategic and International Studies) is supported by the Ford Foundation and also carries out research.

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