This is a radio show that you can download.
Julie Devoll is from HBR.
The HBR Quick Take is here. I am joined by Herman Widjaja, the CTO of Tokopedia, who is with us today to offer insight into how the site uses its digital infrastructure. Thank you so much for joining us, Herman.
Herman Widjaja is a writer.
Hi, Julie. I would like to thank you for the invitation.
Julie Devoll is from HBR.
Herman, tell us about the innovation happening in Indonesia.
Herman Widjaja is a writer.
William Tanuwijaya and Leontinus Alpha Edison founded the company in 2009. Both of them were raised in the remote areas of Indonesia, and started from a very humble beginning. The company's name is toko, which is the Indonesian for "shop" and "encyclopedia." Indonesians, who live in the world's largest archipelago, are hindered by distance and technology despite having equal opportunities, which is why Tokopedia made it its mission to democratize commerce in the country through technology. When it was founded in 2009, Tokopedia wanted to address the lack of trust in online transactions and access to goods and services.
Merchants move to big cities for better markets, while consumers have trouble finding access to goods. Social networks and forums were popular, but they weren't really fixing the problem. There were a lot of issues, like no proper inventory management systems and no clear payment processing services, which end up causing online fraud. The item was never sent, even though many people sent money or transferred money. The goods reached the buyer, but the payment hadn't been completed. The need for a trusted middleman between sellers and buyers was realized by William Tanuwijaya and Leontinus Alpha Edison. August 17 is Indonesian Independence Day and Tokopedia was launched that day.
The company offers a free business platform for merchants and buyers. It also provides payment and logistical services. The largest marketplace in Indonesia is Tokopedia. Most of the merchants on our platform are brand-new entrepreneurs. 99% of the districts in Indonesia are reachable by us. More than 500 million products can be served with transparent pricing. We have contributed more than 1% of Indonesian GDP. It's a bit about where we are.
Julie Devoll is from HBR.
What were the IT and business challenges that Tokopedia had to overcome to become a digital leader?
Herman Widjaja is a writer.
We were founded as a technology company with a mission to democratize commerce through technology, so technology becomes a very important component that actually served the accelerations. Our guiding principles in our day to day are the five core pillars of the technology team.
The first thing we believe in is the platform's strength. Quality, reliability, and platform stability are our core mandate for the business. Being able to run 24 hours a day is crucial to the growth of our community. The balance between moving fast and high quality needs to be changed within the technology team.
Strengthening the security and privacy posture is the second one. The Indonesian market is very important in terms of cultural transformation of security and privacy. It is never too late or too early to embark on this journey. The data protection and privacy office is one of the new offices we created. We want to have world-class standards in security and privacy.
Number three is focused on consumer technology innovation. What is innovation? Our buyers, our merchants, our partners, and our employees all have a part in innovation. It is our willingness to use our growth mindset to solve their problems and our agility and ownership to make it happen.
Data-driven transformation is the fourth thing. The key is data-driven transformation. They play a very important role in being the champion and catalyst for data-driven cultural changes. We need to use data to make decisions. It's important to have access to high-quality, secure, and mature preprocessed data.
One of my favorites is financially optimal execution. As a digital leader, we don't only focus on launching cool features or new products. We need to focus on adapting a good financial model. We need to identify the unique economics of our platform.
The technology teams at Tokopedia have five guiding principles. Number one is making the platform stronger. Number two is to strengthen the security and privacy posture. Number three is consumer innovation. Number four is a data-driven transformation. Number five is financially optimal execution.
Julie Devoll is from HBR.
Tell us about the key elements of the digital infrastructure you built to support this kind of growth.
Herman Widjaja is a writer.
At Tokopedia, we are committed to giving our customers peace of mind, specifically in terms of reliability, security, and trust. Let's talk about them one by one. Reliable monitoring, advanced sensors, and necessary security measures are what we invest in to ensure security. To ensure reliability, we built and maintain a powerful, robust infrastructure that is capable of handling an ever-increasing number of transactions. We built a flexible digital infrastructure that can scale to meet the needs of businesses. We believe in the make-it- better and growth mindset so that our customers, merchants, and partners can feel secure at the end of the day. They think we are reliable. They can feel that they can trust the system.
Julie Devoll is from HBR.
What role did Equinix play in connecting your infrastructure?
Herman Widjaja is a writer.
Equinix allowed us to connect our multi-cloud digital infrastructure and services. This allows us to scale hybrid deployment easily to achieve network agility while directly connecting partners and providers. Our customers experience zero disruption during their online transactions, while new technology like artificial intelligence allows us to understand buying patterns and needs. We use the Equinix platform to get virtual network services. The virtual network services are run on a modular infrastructure platform.
Julie Devoll is from HBR.
In five years, what will Tokopedia look like?
Herman Widjaja is a writer.
We will continue to serve Indonesia, the largest archipelago in the world. Indonesia has the fourth largest population in the world. The markets of the United States, China, and India are already fully digitalized. Indonesia is an exciting market where we need to be the next digitalized market. We will continue to bring the same customer experience in tier-two and tier-three cities as we do in big cities, with a hope to enable people to get anything they want locally at a cheap price.
Julie Devoll, HBR.
This has been a great discussion. I would like to thank you for joining us.
The person is Herman Widjaja.
Thank you, Julie.
Julie Devoll is from HBR.
equinix.com has more information about how to create a digital advantage.
All Rights Reserved © 2024
