DEVELOPMENT OF PROCUREMENT’S PERFORMANCE INDICATOR ON EPC PROJECTS USING TFV APPROACH IN PT WIJAYA KARYA (PERSERO) TBK

• Main Author: MANDUROSISWO NIM: 94516012, GATOT
• Format: Theses
• Language: Indonesia
• Online Access: https://digilib.itb.ac.id/gdl/view/27462
• Institution: Institut Teknologi Bandung

Performance measurement is an important factor for a successful performance management. Even though it is only one of many elements of performance management, it will directly reflect organization’s strategic plan. The results of performance measurement will provide an overview of undertaken activities and feedback in order to meet customer satisfaction and strategic goals. In addition, performance measurement should be able to support the vision, mission, and business strategic of the organization. <br /> <br /> PT. Wijaya Karya Tbk (WIKA) is a company with rapid business growth and has been handling numerous EPC projects. However, its current performance evaluation cannot be utilized for decision making, due to its nature that merely considers output and ignoring process in the EPC project business logic. To overcome the issue, and in accordance with company business development especially in procurement, performance measurement of WIKA needs to be adjusted or developed with EPC business logic. This research aims to develop procurement key performance indicators based on EPC project business logic. This final project report will use TFV (Transformation, Flow and Value) concept approach and EPC business logic for the procurement performance indicators development in WIKA. WIKA performance indicators will be analyzed by identifying the two-way activities of the EPC procurement business process which associated with transformation, flow, and value in every stage. The stages include <br /> <br /> engineering stage to procurement stage, construction stage to procurement stage, and engineering stage to construction stage. Once the business process in the EPC projects has been reviewed, the procurement KPI based on the business logic was developed, afterwhich several indicators were chosen as key performance indicators. Managerial implication of the KPI’s implementation was then analyzed. <br /> <br /> At the end of this research, twelve KPIs of process-based procurement development will be obtained for the project level. These indicators are divided into four categories. First category is supplier and subcontractor selection process. The indicators of the first category are the amount of supplier and subcontractor who are include in current DPPM; the technical document amount and time including technical specification, drawing, data sheet, mto, and bill of quantity; the document amount of goods and services contract acquisition; and the number of goods and services contract that have been validated timely. The second category is supplier and subcontractor performance, which includes delivery and quality of goods; time and quality of work completion; the score of subcontractor K3L implementation; the score of subcontractor 5R implementation; and the score of subcontractor security system’s implementation. The third category is efficiency of procurement with the number of goods and services procurement efficiency as the indicator. The fourth and the last category is warehouse management, which includes the score of warehouse 5R implementation and amount of goods that have damage and lost; and the complaint number from construction function to warehouse function related to the goods amount and technical specification as categories, <br /> <br /> There are several activities that has to be done in order to make the KPI procurement development are successfully implemented. They are: (1) creating a new procedures; (2) reviewing current procedure; (3) procurement organization, human resource requirement, job description, and competence standardization; and (4) the applicable measurement of performance indicators based on information technology.