Engineering company Indkom looks at expansion in the Middle East

Mechanise it: With the company on hyperdrive, Indkom’s revenue went up by RM30mil in 2013 to RM90mil last year.

Being one of the largest suppliers to national power company Tenaga Nasional Bhd (TNB) is an achievement in itself, but Indkom Engineering Sdn Bhd sees continuous growth as the key to being successful.

Founded in 1984, Indkom has been an agent for TNB since the former’s formative years, and it has gone from strength to strength, growing into one of the leading medium voltage switchgear manufacturers in Malaysia.

“Our journey started as a licensed manufacturer and gradually evolved into a full-fledged technology developer. We created our research and development (R&D) division back in 1999 to take ourselves to the next level,” said managing director Jamaludin Mohd Wari.

Indkom’s products are categorised as power distribution equipment and their main clients are utility companies, contractors, electronic equipment suppliers and consultants. But their biggest client, by far, is still TNB, to whom more than 70% of Indkom’s products are delivered.

“We have successfully produced 10 products, including a compact substation, feeder pillar and a RMU circuit breaker. For certain products, with the establishment of our R&D division, we are no longer dependent on the principal party and we have started supplying our own products to other buyers,” he added.

“We adopted ISO 9001-2008 (standards) and soon moved towards Business Excellence Framework (BEF). This framework has contributed to increasing productivity and customer satisfaction in the quality of products and services.

Bright sparks: Indkom’smain clients are utility companies, contractors, electronic equipment suppliers and consultants, and it is looking to grow beyond Malaysian shores.

“To remain competitive, Indkom is committed to this framework as the primary driver in transforming our work culture processes and standard operating procedures,” he said.

Indkom has its sights set on major growth in the local and international front, with China, Yemen, Jordan, Brunei, Singapore and Saudi Arabia on its radar for new business opportunities.

“For instance, Saudi Arabia needs 12,000 transformer units annually on average. In comparison, Malaysia only needs 3,000 units. You can see why we want to penetrate that market,” said Jamaludin.

The company is already field testing some 350 units in the Middle East and full expansion will begin sometime next year.

“We are also looking to expand our factory’s capacity by 50% to support our expansion plan. We invested RM6mil to upgrade our facility and increase our manpower to 190 staff.

“With the increase in manpower and facility, we would be able to churn out many more transformers. Currently, we are producing 16 units per day. We would like to produce 26 unit per day, and I believe we can do this soon,” said Jamaludin.

With the company on hyperdrive, Indkom’s revenue went up by RM30mil in 2013 to RM90mil last year.

“By 2017, we want our revenue to be approximately RM180mil,” Jamaludin revealed.

Major Transformers

Indkom’s recent exponential success started when the company embarked on a mid-term business transformation plan called “Transformer Project” in 2013 to prepare for the competitive global market.

Tech it on: Indkom started as a licensed manufacturer but has evolved over the years into a full-fledged technology developer with its own R&D unit. 

Jamaludin said the global market was there for the taking and that was what the company was aiming for.

“The five-year transformation plan started in 2013 and ends in 2017. The objective is to prepare the company for open competition with innovative and eco-friendly product range supported by highly skilled staff. It is all about making a difference with the goal of turning Indkom into a company that produces world-class products at competitive prices and giving us a leap in transforming our work culture, product, services,” said Jamaludin.

“We are confident of our team. We capitalise on the individual strengths of our employees to make our mark in the switchgear industry, which is dominated by MNCs,” he added.

The foundation for the company’s transformation was laid some 10 years ago when Indkom began to export to the Middle East. Their business performance landed them the Export Excellence Award from the Ministry of International Trade and Industry (Miti) back in 2006.

Ambition: Indkom’s recent success started in 2013 when it started to prepare for the competitive global market.

“As a result of our research and new market potential analysis, we appointed several business partners from various countries to help us penetrate their market and introduce our product,” said Jamaludin.

“We are also striving to reach the same level as Toshiba and Siemens in terms of promoting and selling product. This can only be done if our customers are confident in us,” he added.

By the end their five-year transformation plan, Indkom plans to rebrand itself internally as Indkom Refresh.

Despite getting Indkom getting its first break through a government-linked company, Jamaludin was quick to point out that small and medium businesses should not be reliant to the government all the time.

“Government support is good for those starting out, but we have to quickly learn how to grow and be on our own. We need to look beyond Malaysian shores and aim to be world class,” said Jamaludin.