Strategic Optimization of Idle Industrial Assets: A Decision Tree Approach to Maximizing ROA PT ABC

Rasyid Nata Mulyana; Sylviana Maya Damayanti

doi:10.30640/jmcbus.v4i3.6563

Authors

Rasyid Nata Mulyana Institut Teknologi Bandung
Sylviana Maya Damayanti Institut Teknologi Bandung

DOI:

https://doi.org/10.30640/jmcbus.v4i3.6563

Keywords:

Asset Management, Asset Optimization, Decision Tree, Financial Performance, ROA

Abstract

PT ABC is a construction company that possesses numerous non-operational assets that are managed sub-optimally, rendering them unproductive. Out of a total current asset valuation of IDR 51,777,500,000, these assets only generate an additional revenue of IDR 1,610,000,000 per year, reflecting a low Return on Assets (ROA) of 3.1%. This study focuses on the optimization of Asset I, a 10,000 square meter industrial land plot in Kendal valued at IDR 20 billion, which currently generates zero active income (0.0% ROA). Through a mixed methods approach combining Focus Group Discussions (FGD) with quantitative financial modeling, Decision Tree Analysis was applied as the primary instrument to calculate the Expected Monetary Value (EMV) across all scenario probabilities. Based on the Decision Tree modeling, this research formulates three strategic recommendations for Asset I, tailored to the company's risk posture. If the company adopts an aggressive approach, Scenario A.3 (building 2 units for full fabrication expansion) can be selected to pursue the maximum potential Return on Assets (ROA), albeit with the lowest probability of success. If the company takes a defensive stance, Scenario A.1 (building 2 units strictly for lease) is recommended, as it provides liquidity security and downside protection against macroeconomic uncertainty. However, mathematically, the most optimal strategy is Scenario A.2 (a combination of 1 unit for lease and 1 unit for internal expansion), as it creates the best balance between securing cash flow and driving operational growth, ultimately generating the highest absolute Expected Monetary Value (EMV) among all available options.

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