THE PROPOSED IMPROVEMENT AREA WITHIN ADARO’S EXISTING TRANSFORMATION STRATEGY FOR DIVERSIFYING INTO THE NEW ALUMINIUM SMELTER PROJECT

• Main Author: Effendi, Mohammad
• Format: Theses
• Language: Indonesia
• Online Access: https://digilib.itb.ac.id/gdl/view/78030
• Institution: Institut Teknologi Bandung

Climate change has become a global concern, and at the 21st Conference of Parties (COP 21) held in Paris in 2015, participating countries agreed to phase out fossil fuels and replace them with renewable energy to achieve Net Zero Carbon Emissions by 2060. Adaro Energy Indonesia (A) is a coal-producing company (Fossil Energy), and the company has prepared a business diversification to a non-coal business. The first step is business diversification into the Aluminium Smelter project. This paper focuses on the proposed improvement area for the existing Adaro transformation strategy for its ongoing business diversification efforts, specifically the Aluminium Smelter Project. It explores the current state of Adaro's transformation, identifies areas for improvement, and provides strategic recommendations to strengthen the transformation strategy. The assessment is conducted using Michael Porter's Five Forces theory for market analysis, the PESTLE (Political Economic Social Technological Legal Environment) theory for external scanning analysis, the Organizational Change Management theory for organization analysis, and the Opportunities and Threats theory (SWOT minus SW). These theories together are used to capture Adaro’s ideal transformation strategy conditions. Strengths and Weaknesses (SWOT minus OT) and Resource-Based View (RBV) theories are applied to evaluate AEI's organizational strengths. By comparing the ideal transformation strategy conditions with the existing situation of AEI, areas that require improvements are identified. By refining this strategy, the author is confident that Adaro will successfully navigate the business diversification process and capitalize on the opportunities presented by the Aluminium Smelter Project.