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Business Leader of the Week: Meet Michael Bambang Hartono, Indonesia’s wealthiest person

IFM_Michael Bambang Hartono
Michael Bambang Hartono represented Indonesia at the Asian Games 2018 in bridge, winning a bronze medal with his team at the Supermixed team event

A well-known Indonesian business, Djarum is famous for its wide range of products, which includes cigarettes, clove products, and, more recently, investments in the banking and telecommunications industries. Djarum was first established in Kudus, Central Java, in 1951 by Oei Wie Gwan as a small-scale cigarette manufacturer. It has grown over the years into one of Indonesia’s biggest and most prosperous tobacco companies, with a sizable national and worldwide footprint. Djarum’s success can be ascribed to its dedication to marketing expertise, quality, and innovation.

Kretek cigarettes, which have a unique flavour and aroma from a combination of tobacco and cloves, are among Djarum’s most recognisable products. The business has perfected the craft of producing kretek, fusing cutting-edge technology with age-old methods to produce a singular smoking experience that is adored by customers all over the world. Djarum makes more than just cigarettes; in addition, it makes cigars and cigarettes flavoured in different ways using cloves.

Djarum has expanded its line of business beyond tobacco in recent years. The company has expanded into other industries, such as banking (it owns Bank Dinar Indonesia) and telecommunications (it owns a portion of XL Axiata, a mobile operator). This deliberate diversification is a reflection of Djarum’s dedication to maintaining its relevance in a constantly shifting market and solidifying its standing as a vibrant and adaptable conglomerate.

Despite its success, Djarum has been the subject of debate and criticism, especially in relation to its advertising strategies and the health effects of its tobacco products. Djarum, like many tobacco companies, has had to deal with strict laws and public health initiatives meant to lower tobacco use. Nevertheless, the business continues to rule the Indonesian market thanks to its well-known brand, extensive distribution system, and innovative product line.

Djarum is still a powerful force in the Indonesian and international business arenas thanks to its diverse portfolio and dedication to quality. The brain behind this successful venture is Michael Bambang Hartono, an Indonesian billionaire heir and businessman. He along with his brother Robert Budi has expanded the business beyond tobacco.

Who Is Michael Bambang Hartono?

  • Michael Bambang Hartono was born on 2 October 1939, in the town of Kudus, in Central Java
  • His father Oei Wie Gwan had purchased a small Kretek cigarette factory called Djarum Gramofon (in English, Gramophone needle) in April 1951, and renamed it Djarum
  • After completing his high school in Kudus, he studied in the faculty of economics and business at Diponegoro University in 1959
  • In 1963, the Djarum factory was destroyed by fire and shortly thereafter Oie Wie died, leaving Michael Bambang Hartono and his younger brother Robert Budi Hartono to inherit the factory
  • The cigarette company grew under the two brothers, making its first export in 1972 apart from introducing new products
  • The brothers began their banking career with Haga Bank and Hagakita Bank
  • In 2002, they acquired 51.15% of Bank Central Asia through a consortium led by Farallon Capital and registered under the Mauritius Corporation FarIndo Investments
  • The Djarum group also controls several shopping malls and buildings in Jakarta, including Grand Indonesia, Hotel Indonesia and BCA Tower
  • Michael Bambang Hartono has a net worth of USD 18.5 billion, as of September 2019, making him the 56th richest person in the world, according to Forbes
  • He and his brother, who was also listed slightly under him at 69th, were named the richest Indonesians in 2017, the 9th year in a row
  • His company is also active in internet ventures, controlling e-commerce website Blibli.com and one of Indonesia’s largest online communities Kaskus
  • Michael Bambang Hartono represented Indonesia at the Asian Games 2018 in bridge, winning a bronze medal with his team at the Supermixed team event hence making him the oldest Indonesian Asian Games medal winner
  • He was part of the Indonesian teams which won bronze medals in the 2008 World Bridge Games in Beijing, the 2009 World Team Championships in Sao Paulo, and the 2010 World Series Championships in Philadelphia

‘Bridge Is Like Business’

In an interview with Richmond News, Hartono claims to have used similar skills to those he uses for the bridge to amass an estimated net worth of USD 18.5 billion, as of 2019, from the tobacco, banking, and communications industries.

“Bridge is like business. First, you get the data, the information. You analyse the information, and then you make a decision. So business, real life and bridge are the same. Decision-making is the same. If you want to be a good leader, and you want to be a successful man, businessman, play bridge. Never quit, never give up,” he said.

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