A Technological Capability Assessment of Company in the Crude Palm Oil Industry in Indonesia

Abstract

Indonesia is the world’s largest producer of Crude Palm Oil (CPO). Accordingly, it is vital that Indonesian CPO industries diversify and add value to downstream products. Technological capability is a key component for agricultural-based industries to retain their global competitiveness and holds immense importance in facilitating product-based diversification. In terms of technological capabilities that are specific to agricultural-based industries, unique indicators and parameters have been identified and include research and development, human resources, strategic planning, technology infrastructure, and manufacturing. Having knowledge of organizational technological capabilities can contribute to expanding the range of available downstream Crude Palm Oil (CPO) products. However, the income generated from CPO in Indonesia is currently lower compared to that achieved by its competitors. The current study was conducted on 11 CPO companies in Sumatera Utara Province, Indonesia. The purpose of the study is to develop an assessment tool. The tool is proposed to measure the capability of technology in crude palm oil-based industries. The device developed is also to obtain empirical data in order to determine the capability of technology in CPO companies. The descriptive analysis approach is applied in this study.

Keywords

• crude palm oil (cpo) industries
• downstream products
• technological capability