Depok, July 2, 2025 — In his dissertation titled “Design of Service Productization and Strategic Collaboration in Building a Total Care Aircraft Service-Product System (in Global Aircraft Maintenance Companies),” Jemsly Hutabarat, a doctoral graduate from the Faculty of Administrative Sciences, Universitas Indonesia (FIA UI), offers a new perspective on the future of the aircraft Maintenance, Repair, and Operations (MRO) business. His research explores how MRO companies can increase their revenue and corporate value through an integrated strategy.

The MRO sector is highly sensitive to economic and political fluctuations, facing challenges such as intense competition, advancements in aircraft maintenance systems and technologies, regulatory changes, global environmental shifts due to the COVID-19 pandemic, and evolving demands from airlines. These dynamics are set against the backdrop of a drastic decline in airlines’ revenue per ton-kilometer—dropping sixfold from 1970 to 2023—driving airlines to seek ways to reduce operational costs, particularly in the areas of capital and maintenance expenses, which are among their top three largest cost components.

“This dissertation shows there is a significant demand from airlines for Total Care Aircraft service-product systems (0.761). This demand is 134% higher compared to the demand for standard aircraft maintenance services,” said Dr. Jemsly.

Total Care Aircraft expands the scope of MRO services by integrating the provision of tangible products, such as floating spare parts and support components. This new business model can be achieved through internal service productization capabilities or through strategic collaboration with manufacturers and suppliers. Revenues are generated not only from maintenance services but also from additional charges such as access fees, availability fees, loan fees, and exchange fees, all billed in a single rate per flight hour (USD/per flight hour). The global MRO market is projected to reach USD 137 billion by 2033, with the domestic market valued at USD 1.8–2.4 billion annually.

The dissertation also highlights the need for specialized strategic governance in MRO, customized yield management pricing strategies based on demand, and adjustments in revenue and cost recognition practices to align technical, maintenance, and scheduling aspects, alongside warranty coverage for seven core products and the development of new MRO-specific procedures in the implementation of PSAK-72 (IFRS-15), in line with fundamental financial and accounting principles.

This study presents nine novelties—six in theoretical research practices and three in regular business practices. The theoretical novelties include the finding that quality is not the top priority in the MRO business (ranking third), which contrasts with Imai’s (2012) view; a specialized strategic governance model for collaboration in service productization within the MRO business, expanding on Wood & Gray’s (1991) study; additional variations and specific conditions extending the findings of Thomson and Miller (2007) in the context of customized yield management pricing ($/FHRS) in aviation and MRO as a new approach to demand-based price differentiation; and the intertwined strategy of service productization versus product servitization, where productization can be implemented with certain limitations. The study also identifies that MRO requires specialized procedures and versions for applying PSAK-72, demanding technical, financial, and accounting expertise.

Dr. Jemsly recommends that the business sector form specialized teams to develop Total Care Aircraft service-product systems, build expertise and specialization in applying PSAK-72, respond to significant airline demand, and align as well as elaborate on Strategic Governance in Collaboration for implementing service productization. For academics, he suggests updating and expanding concepts and theories on new variations in collaboration, strategic governance for service productization in the MRO business, and industry-specific quality priorities. He also proposes introducing new concepts and theories related to intertwined strategy, such as Multi-Industry Analysis, the redefinition of competitors or adversaries in strategic collaboration, and new pricing strategies in customized yield management ($/FHRS), along with an integrated approach to revenue and cost recognition under PSAK-72.

He further explained that the government is encouraged to adjust regulations (including law amendments) to support an investment-friendly climate, particularly in developing service productization for Total Care Aircraft. The government should also facilitate and accelerate the development of ready-to-use capabilities and competencies for high-tech, labor-intensive jobs in the MRO sector and support the empowerment of the aviation industry and technological advancement in accordance with Indonesia’s Aviation Law No. 1 of 2009, Articles 370, 371, and 372, as well as the implementation of Article 370 paragraph 3 section (f), by preparing and developing aerospace or aviation parks. Further research on MRO companies outside Indonesia is also recommended to generalize and validate the findings on a global and international scale.

The doctoral promotion was chaired by Prof. Dr. Dra. Retno Kusumastuti Hardjono, M.Si., with Prof. Bernardus Yuliarto Nugroho, MSM, Ph.D. as the main supervisor and Prof. Dr. Martani Huseini as the co-supervisor. Committee members included Prof. Dr. Ir. Mohammad Hamsal, MSE, MQM, MBA, Dr. Sri Bramantoro Abdinagoro, MM, CBV, CMP., Prof. Dr. Milla Sepliana Setyowati, S.Sos., M.Ak., and Dr. Fibria Indriati Dwi Liestiawati, M.Si.