Mitr Phol Group is pressing forward with research and development of innovative products and production processes in order to speed up its future growth.
"Focusing on R&D can determine whether our businesses will grow fast or slow. R&D creates competitiveness over our rivals. If we ignore developing innovative products or production processes, our businesses may not survive," president Krisda Monthienvichienchai said recently.
The company's core business - sugar - is a commodity, so if it did not start focusing on R&D eight years ago, its overall business would have stagnated, he said.
Mitr Phol initiated the Mitr Phol Innovation contest eight years ago to open up an opportunity for its employees in every business to vie in creating and developing innovative products or production processes. The project entries will have to be proven a success in a real situation. The winning projects will be applied to the real production processes of Mitr Phol Groups' five businesses - sugar, biomass power plant, ethanol, particleboard, and warehousing and logistics.
For example, one of the winners in the contest last year was Mitr Phol Syrup, a ready-to-use sugarcane syrup. The company has developed the project commercially this year, and Mitr Phol Syrup has become a new product of Mitr Phol Sugar Group. So, the company has added a new area - New Business Excellence - to the ninth contest this year.
Besides New Business Excellence, the entries will compete in Process Excellence and Management and Administration Excellence.
One of the winners of the contest this year is a bark extraction machine, which can reduce staffing but generate more product. The strength of this machine is that it can produce more bark, so the company will have more feedstock for its power plants, which has a higher value than selling bark. Besides, reducing bark means that the company can help save the environment.
The company's ethanol business was studying to produce yeast itself to increase ethanol yields. If the experiment is a success, Mitr Phol will not have to import yeast, which can help cut production costs.
Mitr Phol has found a way to produce ethanol from cassava. Before, the company only used molasses, a by-product of making sugar from sugarcane. It faces molasses price fluctuations in some years, so, it would like to diversify risk from using only sugarcane in ethanol production.
Mitr Phol has developed a machine that can process cassava chips as well as cassava starch into a raw material for producing ethanol. Now, it can switch to using cassava chips and cassava starch during these times of high prices for molasses. It can diversify risk from high raw material costs and sell ethanol for a good profit.
The company also allocated more funds to developing irrigation systems for contract farmers who sell sugarcane to the company. It has proven that a good irrigation system can increase sugarcane yield without expanding the arable area. If the yield increases, the company will have more raw materials for all businesses.
"The first time we initiated the innovation contest, we did not think about increasing revenue and net profit, but we thought about improving and developing production efficiency. We wanted new ideas from our staff. Now we've gained higher-than-expected outcomes as Mitr Phol employees have participated in developing the company's businesses," he said.