FACTORS THAT SUPPORT BETTER PUBLIC ASSET MANAGEMENT

Jose A. Lukito

Senior Advisor on State Asset Optimization, DGSAM, Indonesian Ministry of Finance

(Tenaga Pengkaji Optimalisasi Kekayaan Negara, DJKN)

Public Asset Management or technically known in Indonesian as “Pengelolaan Barang Milik Negara/Daerah”, experiences a very interesting dynamic to continue to be studied. The number and value of assets managed are very significant in term of number and value, but at the same time there are limited fiscal capacity so it is necessary to find a strategy for asset optimization in the midst of the increasingly complex things faced such as:

a) limited resources (especially financial);

b) increasing public expectations;

c) declining quality of environmentally sound management;

d) declining economic age of assets due to climate change; and

e) increased dependence and engagement (interdependence) between sectors and institutions.

Traditionally, asset management in the public sector has aimed to provide the right quantity of assets at the most cost-efficient in the context of service to public. Meanwhile, the non-traditional goal is to realize the role of assets in the economy and be able to generate revenue. There are best practices that have largely been standardized into a guideline or asset management system, making it easier for others to adopt or replicate. Among some of the leading standards or asset management systems today can be identified what are the main factors in asset management best practices as in the following Table.

GUIDELINES OR ASSET MANAGEMENT SYSTEM
PAS-55, UK (J Woodhouse, 2001)	BSI ISO 50001 Management Systems, UK (ISO, 2014)	Royal Institution of Chartered Surveyor, UK (Jones & White, 2008)	IAM Critical System Enabler, AUS-NZ (AAMCoG, 2011)	International Infrastructure Management Manual, AU-NZ (Dever-Tod, K. 2011)
§ Information management § Training, awareness and competence § Structure, authority and responsibility § Risk management process § Communication, participation and consultation § Legal and other requirements § Management of change § Outsourcing of asset management activities	§ Information requirements § Awareness § Resources § Communication	§ Data and information management § Resources and capacity § Organisational issues § Sustainability and corporate social responsibility § Leadership § Customers	§ Information management § People factors. § Risk management	§ Information system and Tools § Asset management Teams § Quality Management § Continuous improvement § Asset management Plans § Asset management service delivery

Based on the synthesis of those asset management systems, to support asset management processes that meet best practices it is necessary to consider the main factors that can be categorized into core capabilities (HR, process, and technology) elements as follows:

a) Human Resources - Managerial and technical competence- Organizations that are fit for purpose- Leadership- Change Management
b) Process - Business Process - Principle of continuity- Risk Management- Communication- Planning- Service- Regulation
c) Technology - Data and Information Management- Information Technology

The author has conducted a study/research for the contextualization and adaptation of above factors to public asset management in Indonesia, with the following explanation:

a. That the purpose and objective of this Study is to find factors supporting success in the empirical management of Government assets.
b. The methodology of the study began with a literature review and interviews were conducted with respondents from the Central Government (Jakarta and Semarang) and Regional Governments (i.e.. DKI Jakarta Provincial Government and Semarang City Government). Interviews (semi-structured interviews) were conducted with respondent profiles, as follows:- Respondents consisted of central and local governments, academics/scientists, non-governmental organizations and the private sector in Jakarta and Semarang. - The majority of the respondents were key people in the organization ranging from the Secretary General, Director, Head of Institutions, Head of Regional and Operational Offices, Dean of the university, Head of Division and director of the company. - The asset managers include respondents in this study represented by Echelon II and Echelon III at the Head Office, Regional Offices, and KPKNL located in Jakarta and Semarang.
c. The interview results were coding using NVivo11 software which helps us in systematic recording, coding, and cross-checking of qualitative data. The results of semi-structured interviews are further processed and analyzed including reflecting them with existing literature. To ensure the validity of the identified factors, verification is carried out with several respondents to obtain responses and in the end the factors can be produced that have been verified.

The results of the study (findings) are the discovery of factors that support the success of Government assets management as follows:

1. GOVERNMENT LEADERSHIP AND COMMITMENT
2. ADEQUATE LEGISLATION
3. RESOLUTION OF EXISTING LEGAL ISSUES
4. THE REALIZATION OF ASSET ORDER
5. HR COMPETENCIES
6. INFORMATION AND COMMUNICATION TECHNOLOGY (ICT) AND COMPUTERIZED DATABASES
7. ASSET PLANNING
8. GOOD COORDINATION
9. BUDGET
10. MONITORING AND EVALUATION

This study adds practical knowledge as part of supporting research-based policy in the management of Government asset in Indonesia. However, this study has limitations because respondents come from 2 (two) regions, namely Jakarta and Semarang. In the future, it is necessary to further study with the additional respondents and areas within a longer study period.
For DGSAM (Directorate General of State Assets), this study emphasizes that the above-mentioned 10 (ten) factors must be the main point of attention or priority that need to be strengthened by DGSAM in order to succeed in managing Government assets equipped with the availability of performance measurement for each factors. Although most of these factors are in accordance with the existing 'DJKN Roadmap' and the 'DJKN Strategic Plan' (Renstra) which has contained indicators and activities, however the Government asset management are dynamics and challenging accordingly other new factor(s) would possibly arise.

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Jakarta, November 2022

Jose A. Lukito (jose@kemenkeu.go.id)


References

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