Surreal illustration of an Indonesian shipyard symbolizing strategy and unique capabilities.

Boosting Shipbuilding Performance: How Unique Capabilities and Smart Strategies Can Propel Indonesian Industry

Lena Voss in Business & Economy August 2025 • 4 min read.

"Unlock the potential of Indonesia's shipbuilding sector with innovative strategies and unique capabilities to drive company performance and gain a competitive edge."

Indonesia's shipyard industry boasts immense market potential, offering a wealth of opportunities for growth. Both domestic and international markets beckon, presenting avenues for Indonesian shipbuilding companies to expand their footprint on a global scale. Yet, despite this promising landscape, the international market share of Indonesian shipbuilding remains modest, signaling underlying challenges that hinder the sector's overall performance.

These challenges often stem from issues related to functional strategies and the cultivation of unique capabilities within the industry. To address this, a recent study delved into the impact of these factors on company performance, aiming to identify key drivers for success in the Indonesian shipbuilding sector. By examining the interplay between unique capabilities, functional strategies, and overall performance, the research offers valuable insights for companies seeking to thrive in this competitive arena.

This article delves into the findings of this study, exploring how Indonesian shipbuilding companies can harness their unique capabilities and implement effective functional strategies to boost their performance and gain a competitive edge in the global market. From optimizing operational efficiency to fostering innovation, this exploration offers a roadmap for success in the dynamic world of shipbuilding.

Unlocking Competitive Advantage: The Power of Unique Capabilities and Functional Strategies

Surreal illustration of an Indonesian shipyard symbolizing strategy and unique capabilities.

The study underscores the crucial role of both unique capabilities and functional strategies in shaping the performance of Indonesian shipbuilding companies. Unique capabilities, referring to a company's distinctive resources and expertise, and functional strategies, encompassing approaches to areas like marketing, finance, and operations, collectively influence a company's ability to compete effectively.

The research methodology involved a comprehensive causality investigation across 50 shipbuilding companies in Indonesia, employing Partial Least Squares (PLS) models to analyze the data. The findings revealed that both unique capabilities and functional strategies have a significant impact on company performance, both individually and in combination.

Unique Capabilities: A company's distinctive resources and expertise that set it apart from competitors.
Functional Strategies: Approaches to key areas like marketing, finance, and operations that support overall business goals.
Company Performance: Measures of success such as market share, profitability, and growth.

Interestingly, the study highlights that functional strategies exert a more dominant influence on company performance compared to unique capabilities alone. This suggests that while having unique resources is valuable, it is the effective implementation of well-defined strategies across various functional areas that ultimately drives superior performance in the Indonesian shipbuilding industry.

Strategic Implications: Charting a Course for Success

The insights gleaned from this study offer actionable guidance for Indonesian shipbuilding companies seeking to enhance their competitiveness. By prioritizing the development and implementation of robust functional strategies, particularly in areas like information technology, marketing, and operations, companies can unlock their full potential and achieve sustainable growth. Complementing these strategies with a focus on cultivating unique capabilities will further solidify their position in the global shipbuilding market. Ultimately, a holistic approach that integrates both strategic and capability-based initiatives will pave the way for a thriving and competitive Indonesian shipbuilding industry.

About this Article -

This article was crafted using a human-AI hybrid and collaborative approach. AI assisted our team with initial drafting, research insights, identifying key questions, and image generation. Our human editors guided topic selection, defined the angle, structured the content, ensured factual accuracy and relevance, refined the tone, and conducted thorough editing to deliver helpful, high-quality information.See our About page for more information.

This article is based on research published under:

DOI-LINK: 10.1504/ijbg.2018.091505, Alternate LINK

Title: The Influence Of Unique Capability, Functional Strategy On Company Performance Of Shipbuilding Industry In Indonesia

Subject: General Business, Management and Accounting

Journal: International Journal of Business and Globalisation

Publisher: Inderscience Publishers

Authors: Wahyuddin Bagenda, Ernie Tisnawati Sule, Erie Febrian, Diana Sari

Published: 2018-01-01

Everything You Need To Know

What are the key components that drive success for Indonesian shipbuilding companies?

The success of Indonesian shipbuilding companies is driven by two key components: **Unique Capabilities** and **Functional Strategies**. **Unique Capabilities** refer to a company's distinctive resources and expertise, setting it apart from competitors. **Functional Strategies** encompass approaches to key areas like marketing, finance, and operations. Both are essential, but the study indicates that well-defined and effectively implemented **Functional Strategies** have a more dominant influence on **Company Performance**.

How does the study measure the impact of unique capabilities and functional strategies?

The study employed a comprehensive causality investigation across 50 shipbuilding companies in Indonesia. Researchers utilized Partial Least Squares (PLS) models to analyze the collected data. This method allowed them to assess the influence of both **Unique Capabilities** and **Functional Strategies** on **Company Performance**, providing insights into their individual and combined effects within the context of the Indonesian shipbuilding industry.

Why is the Indonesian shipbuilding sector's international market share modest despite its potential?

The modest international market share of Indonesian shipbuilding, despite the sector's immense market potential, is often attributed to underlying challenges related to **Functional Strategies** and the cultivation of **Unique Capabilities**. The industry needs to refine its strategies across key functional areas such as marketing, finance, and operations, as well as develop distinctive resources and expertise, to enhance its global competitiveness.

What are 'Unique Capabilities' and why are they important?

**Unique Capabilities** are a company's distinctive resources and expertise that set it apart from competitors. These can include specialized skills, proprietary technologies, or a unique brand identity. They are important because they contribute to a company's competitive advantage. However, the study emphasizes that while having **Unique Capabilities** is valuable, it is the effective implementation of **Functional Strategies** across various areas that ultimately drives superior **Company Performance** in the Indonesian shipbuilding industry. This means that while having unique strengths is helpful, having a solid plan for areas like marketing and operations makes an even bigger difference in business outcomes.

What strategic implications can Indonesian shipbuilding companies take away from this study to improve their performance?

Indonesian shipbuilding companies can enhance their competitiveness by prioritizing the development and implementation of robust **Functional Strategies**, particularly in areas like information technology, marketing, and operations. They should complement these strategies with a focus on cultivating **Unique Capabilities**. This holistic approach, integrating both strategic and capability-based initiatives, will pave the way for sustainable growth and a stronger position in the global shipbuilding market. This includes focusing on improving both their operational efficiency and their distinctive strengths.