Bambang Bhakti: Bring Merpati Back from the Brink

AFTER working for a number of multinational corporations for many years, Bambang Bhakti had no qualms about working for a state-owned airline despite not having a background in that field. He regarded it a call from the nation and a golden opportunity as not many people are called on to work for the country after retirement age.

Indeed, there are not many professionals like Bambang Bhakti, who worked for three major companies. Bambang worked not only for major multinational corporations for 32 years, but also for a semi state-owned company, the Jakarta International Container Terminal.

Now Bambang has joined a pure state-owned company, PT Merpati Nusantara Airlines. However, he is fully aware that he was appointed to the job due to an emergency situation and it is not a permanent position. "I know that at any time and any moment I can be dismissed, especially once my mission is over," he said with a smile.

After his appointment, he immediately set about getting things moving at Merpati so that the company could "turn around from dying to flying", which has become its internal slogan. While some people thought efforts to turn around the airline would involve financial matters, Bambang, who formerly worked at Coca Cola as its operational director, concentrated more on the company's work culture.

He first challenged his employees to increase the size of the pie so that the slices would become larger for them as well as for the shareholder. "As a consequence, please do not view Merpati as a state-owned company that easily gets an injection of funds or aid from its shareholder, namely the government, but we have to learn to be independent and live on what we earn," said Bambang.

The work culture transformation started off with the ownership. He said that directors could join or leave at any time as per requirement or evaluation by the shareholder. So, according to him, the real owners of Merpati were the employees from the level of general manager and below. Hence, the 15 general managers were promoted to directors. Then Bambang formed four departments that would make decisions and work responsibly. Previously, said Bambang, employees used to ask for direction or guidance from the directors, which he felt was not beneficial or positive as the responsibility for decisions was borne by the directors.

Bambang's flexible and direct approach in his relations with the employees helped him change the work culture at Merpati. He often holds meetings in his office in a relaxed but dynamic atmosphere. Sometimes meetings are held at Sarang Elang, his outdoor training place.

Meetings that are held with participants sitting together on the terrace, said Bambang, can eliminate functional or bureaucratic barriers and layers so that attendees can disagree on some points. "The employees and staff at Merpati are dynamic and willing to learn. They can be asked to be more open while at the same time remain polite," Bambang said. "They have a strong desire to change and they are good at calculating," he added.

Bambang has not lost the optimism - on turning Merpati around - that he felt when he was first invited by the transportation minister to join the company. At first Merpati's "report card" had "red grades" for both its balance sheet and cash flow. "Financially it was bankrupt," said Bambang, who is lecturer at the University of Indonesia and the Bandung Technology Institute.

At the time, Merpati could not afford to buy airplane fuel, pay its insurance premiums or meet its payroll. Today Merpati is a much healthier company. Its cash flow has improved, but not its balance sheet as it still has a Rp 2.5 trillion (US$250 million) loan to pay off. Bambang helped the company progress by changing the strategy.

Merpati had neglected its original destinations and went after image, or red sky, destinations like the Jakarta-Medan, Jakarta-Surabaya and Jakarta-Padang routes. "All these routes were image routes for us but the company was soon bleeding as the competition was very tight," said Bambang, who was inspired by a book titled From Worst to First written by Gordon Bethune about Continental Airlines, which had a similar history to Merpati's.

Previously, no one paid any attention to "blue sky" areas. The planes used back then burned more fuel, the price of which was high. The overhead was also killing the airline.

Today, with the support of all employees, Bambang is focusing on more on blue sky areas or positive marketing areas. He is also reducing the company's overhead costs, reducing the number of employees and changing the planes to those that burn less fuel. The price of fuel is currently lower than before. Major layoffs are usually problematic, but not at Merpati, which laid off 1,300 employees in one month. "The key was open communication," said Bambang.

He explained in detail the company's situation to the staff and told them there was no work for them. The Voluntary Golden Hand Shake program was introduced, and eventually those who stayed with the company were registered at the Manpower Office.

During this critical period, all the directors kept communicating with each division, met with the pilots' association, labor union and explained the crisis. "I did not feel a sense of crisis on my first day at Merpati. Everyone was unperturbed, so we had to create a sense of crisis," said Bambang. As a result, everything went smoothly and the head office was gradually moved to Makassar.

Although Merpati is still facing various problems, Bambang works with passion. He is at his office early every morning, be it in Jakarta, Surabaya or Makassar. He flies more often than ever before and considers flying more convenient as there are no traffic jams. "In my work everything is dynamic, the market is also dynamic and highly competitive, while our financial situation is limited but we have to survive," he said.

He interprets leadership in five words: Clear, Direct, Firm, Respected and Final. He also believes there is abundant opportunity for people who are willing to grab it. "For now, the most important thing is to keep Merpati flying," said Bambang, who loves food from the regencies and wants to work for as long as possible. "Later, if no state-owned company wants me perhaps I will return to work for a private company. Who knows, some company may find me useful," said Bambang with a laugh. (Lily G. Nababan) 

The Jakarta Post, August 26, 2009 - Mr. Bambang Bhakti has passed away*