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Japfa's CEO Tan invests in staff and partnerships for endurance and growth

Feng Zengkun
Feng Zengkun • 7 min read
Japfa's CEO Tan invests in staff and partnerships for endurance and growth
Tan: To me, the biggest risk to any firm is complacency / Photo: Samuel Isaac Chua
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For Japfa CEO and executive director Tan Yong Nang, helming a firm is like steering a ship. “Even in a turbulent sea, you don’t focus on the water around you in your immediate vision. You keep your eyes on a beacon far away that gives you your direction, and try your best to get there,” he says.

In practice, Tan explains that it entails striving for maximum efficiency, valuing employees as the business’s core and cultivating enduring partnerships to navigate industry fluctuations. Such farsightedness is how he turned Japfa — which is headquartered in Singapore — into a regional agribusiness with more than 38,000 employees in an integrated network of modern farming, processing and distribution facilities in Indonesia, Vietnam, India, Myanmar and Bangladesh. Japfa was also in China until last year before the spin-off of its dairy business.

The company specialises in producing protein staples, namely poultry, swine, aquaculture and beef, and packaged food that nourishes millions of people. Today, it is Indonesia’s second-largest integrated industrialised poultry firm, among other market-leading positions.

“When you focus on building capabilities, you become stronger and last longer,” Tan says. “To me, the biggest risk to any firm is complacency. We try to improve ourselves daily, find better ways to do the same jobs, and continually upgrade ourselves.”

Mission to feed Asia

When Tan joined Japfa as assistant to the CEO and COO of corporate services in 2007, he already had growth in mind for himself and the company.

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He began his career in 1985 in the public sector as a statistician in the Department of Statistics and then a research economist in the Ministry of Trade and Industry. He then spent nearly two decades in Prudential, the PAMA Group, Delifrance (where he was CEO from 2003 to 2005) and the Hong Kong-based supply chain management company Li & Fung Group, where he took on the roles of project director and COO.

While his experience in private equity allowed him to be exposed to many types of industries, the experiences eventually left him wanting to be more involved in operations. Tan explains: “At the very senior level, my involvement was becoming more advisory-focused.”

“It felt as though my professional life was still incomplete. I needed to do something different, to build something up. I had this vision of laying a foundation and adding to it every month, every year, until I had a business contributing a lot to society.”

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With its breadth, Japfa gave him that opportunity. He says: “Our mission is to feed billions of people in Asia and to do that sustainably. We support food security by providing food sources locally. Not many companies can say these things about themselves.”

Since Tan became Japfa’s executive director in 2009, its COO in 2011 and then CEO in 2014, he has spearheaded regional expansion of its operations, including in the swine and dairy business segments. He continues: “When I came to Japfa, it was very Indonesian-centric, very poultry-centric. We grew it into a more regional business with a strong base in Indonesia and diversified into other proteins to give Japfa more pillars of growth.”

“We’ve been around for about 50 years, since 1971, but some people still think of us as a small farmer. What they don’t understand is that we are a big organisation and that we have put in the work to become even bigger in the future.”

Nurturing people and partners

The firm’s investment in its staff is crucial, he adds. “We put a lot of emphasis on our people’s development. One of our key principles is to push our people in the right direction every day, to be a bit better than they were yesterday.”

The company works with the leading business schools and has training programmes for senior, middle and junior management. It also set up The Learning Centre (TLC) in Bogor — an hour’s drive from Jakarta — as a dedicated space for employees to meet, train, share knowledge and be a recreation and networking hub.

Tan says: “TLC means many things to us. It refers to The Learning Centre and the tender loving care that is part of our corporate culture. To these, we have added another TLC: The idea that we should Think, Learn and Contribute.”

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“Think, meaning we should think things through before we do them and always look for ways to advance. Learn because the world changes so quickly that we cannot stick to the same old practices and must embrace lifelong learning. Contribute, not just to Japfa, but society too.”

At the same time, Japfa has cultivated close ties with top-flight genetics companies to breed high-performance parent livestock to set itself apart from rivals. Tan explains: “Strategically, it’s so important for us to find the right partners in genetics.”

“Simply put, if your gene pool allows you to grow to five feet tall, you won’t get taller than five feet. But if you can increase the ceiling to six feet via genetics, you suddenly have more potential. It’s the same in farming. To be good at what we do, we collaborate with partners to understand and harness science to boost our business.”

He adds: “I think it’s a testament to how we have built relationships that most of the partners we work with have been with us for a long time.”

Opportunities for growth

Tan sees room for Japfa to grow further in the region. He adds: “Take Indonesia. While we have done well in the poultry sector, our aquaculture business is still small in revenue and profit and offers great growth potential. Our business in Vietnam is growing very quickly, too. Beyond that, we have China, through our sister company AustAsia, India and Bangladesh, which all have big populations.”

The company is also innovating in different ways. Tan says: “Not many people know we are the only animal farming group in Asia with a vaccine business, Vaksindo, to support our poultry operations. Vaksindo has expanded overseas with a presence in India and, more recently, Vietnam to support our swine operations.”

“The way we have organised ourselves, each division grows on its own, financed by its own banking support. This enables us to grow organically in each area. We have many horses in the race and don’t have to pick between them. At this point, we are competing against the leading players in our industry. We are all in the top division.”

Japfa

Headquartered in Singapore, Japfa is a leading vertically integrated agri-food company listed on the Singapore Exchange Main Board since 2014. Established in 1971, the group has grown into one of Asia’s leading lowcost producers of protein staples, including poultry, swine, aquaculture, and proteinbased consumer products across fast-growing emerging Asian economies such as Indonesia, Vietnam, India, Myanmar and Bangladesh. Japfa embraces an integrated industrial approach to livestock and food production across the value chain. Its operations span from feed and breeding (upstream), fattening (midstream) and processing and distribution (downstream). The company’s website is: https://www.japfa.com

About kopi-C: The Company Brew

kopi-C is a regular column by SGX Research in collaboration with Beansprout (https:// growbeansprout.com), a MAS-licensed investment advisory platform that features C-level executives of leading companies listed on SGX. These interviews are profiles of senior management aimed at helping investors better understand the individuals who run these corporations

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