Proposed Business Strategic Improvement to Accelerate Waste Management Business Unit at Building Materials Company (Case Study at Cement Inc)

The rising environmental concerns and regulatory measures in Indonesia have created new opportunities for the expansion of waste management services in the cement sector, specifically by utilizing thermal technology. The Waste Management Unit (WMU) of Cement Company presents substantial strategic opportunities for expansion and development. After undergoing a merger and acquisition, Cement Inc experienced a transformation and has now become a state-owned firm. This change offers WMU Cement Inc further opportunities for growth and expansion. The objective of this research is to identify the most effective strategy for the Waste Management Business Unit within the Cement Company using the Analytical Hierarchy Process. The study explores three fundamental research question: (1) What is the current situation for WMU Cement Inc in terms of market, money, customer, and organization? (2) What are the obstacles inside the organization and in the external environment that hinder the acceleration of waste management services in Indonesia, resulting in limited value creation for the company? (3) What are the suggested recommendations and strategic choices for the company to enhance its value absorption? The study used the SWOT (Strengths, Weaknesses, Opportunities, and Threats) and AHP (Analytic Hierarchy Process) framework to perform a comprehensive evaluation and evaluate three strategic options for the waste management division: retaining it within the cement firm, expanding it to the cement group as a whole, or establishing it as an independent entity. The results of this study indicate that the most favorable choice (40.6%) is to establish WMU as a separate entity, which offers greater advantages compared to fully integrating with the parent company (30.9%) and keeping the current business operations (28.4%). By creating WMU as an independent organization, it may effectively avoid market and pricing cannibalization amongst its subsidiaries and optimize operations. WMU Cement Inc possesses the capacity to assume a leading role in waste management services by offering waste solutions to all SIG subsidiary plants and other cement makers, including ITP. The benefits of this method include autonomous operations, targeted management, rapid decision-making, and varied income streams achieved via the cultivation of specialized skills and expertise in waste management. This decision presents a chance to attract targeted investments and collaborations that promote innovation and expansion in waste management.