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Indonesian firms work to keep secrets safe

Publication Date : 30-04-2012

 

Despite financial trouble, state-owned firms in the strategic industry are putting extra effort into human resource management with one objective in mind: Keeping the country’s trade and military secrets safe.

Agus Iriono, a senior employee with weapons manufacturer PT Pindad, said the most crucial stage in the recruitment process was the so-called clearance interview.

"During the interview, aan employee candidate is asked to detail his or her family background, including the occupation and social activities of all family members,” Agus, who leads Pindad’s light ammunition division, told The Jakarta Post recently.

"It is designed to detect whether a candidate has any vested interest in joining the company as well as gauging if the candidate is too far to the left or right in political affiliation,” he said.

Even after their retirement, Pindad employees remain tied to the firm.

Pindad, according to Agus, always invites former employees to attend the company’s anniversary. It has also granted small farm land to retired low- and mid-level employees to help them make ends meet after leaving the company.

"These people left Pindad with significant amounts of information about the country’s weapon-making process internalised. So it is very important for Pindad management to ensure that its former employees maintain a strong personal attachment to the company so that the nation’s secrets stay safe with them,” Agus said.

Operating two production sites in Bandung, West Java, and Malang, East Java, Pindad currently employs more than 2,000 workers, producing, among others, 20,000 assault rifles, 18 million 9-mm bullets and 50 million 5.56-mm bullets annually.

In a recent visit to Pindad’s production facility for ammunition in Malang, the Post found the 160-hectare compound was heavily guarded by military personnel. During a tour of the company’s plant and warehouses, visitors were not allowed to take pictures and must be supervised by security guards.

When asked about potential espionage activities targeting Pindad’s production facility, Agus admitted that the company had seen several cases of “infiltration” in the past few years. Agus declined to give details of the incidents, citing corporate secrecy.

In their heyday, during the 1980s and 1990s, along with shipmaker PT PAL Indonesia and aircraft manufacturer PT Dirgantara Indonesia, Pindad received generous financial support from the government via the then research and technology minister and head of the Strategic Industry Regulatory Body (BPIS), Bacharuddin Jusuf Habibie, who was also a close confidant to president Soeharto.

The companies’ fortunes plummeted in the period following the 1998 Asian financial crisis when the government, under pressure from the International Monetary Fund, cut its financial support to the companies. They soon faced long-standing financial problems and management woes, which led to the departure of their top experts and engineers.

With aircraft orders now dwindling, Dirgantara’s technology and business development director Dita Ardonni Jafri said it was hard for the company to retain its experienced, qualified engineers who could easily work for many foreign aircraft manufacturers.

What the company could do, Dita said, was offer their expert engineers slightly higher pay rates than those of similar companies in other developing countries.

"India, as a comparison, currently sells the services of its expert engineers to third parties for around US$25 per hour per person,” he said, adding that the company currently had fewer than 900 engineers and technicians, much lower than the 2,000 skilled workers two decades ago.

With only 80 experienced, yet aging engineers left to design, develop and build ships for the company, PAL’s director for human resources and general affairs Sewoko Kartanegara said the company’s late regeneration had forced it to recruit some retired engineers as special staff in order to maintain service quality.


 

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