PURCHASE ORDER CYCLE TIME IMPROVEMENT AT PT O&G

• Main Author: Saputra, Dani
• Format: Theses
• Language: Indonesia
• Online Access: https://digilib.itb.ac.id/gdl/view/36922
• Institution: Institut Teknologi Bandung

areas and increase production target. In 2017, PT O&G was defining the mid-term strategy to add $2 billion of value by 2020. This strategy goal is expected to be achieved through $0.7 billion in improving production and $1.3 billion in improving cost by removing the waste. Reliability improvement is the key areas to improve the production. The plant reliability could be improved by executing maintenance work timely with high quality. This project is intended to increase Purchase Order (PO) cycle time to improve material availability at site, to allow maintenance work can be done timely. Current PO cycle time is 32.9 days that’s longer than the target of 19 days. Theory of constraint approach with current reality tree (CRT) cause-effect model was used to find out the root causes. Day in life of studies (DILO) was also used to understand what’s really happening on the procurement process, so the waste can be identified. Strategic sourcing was found not adequate to improve the items into the contract to allow auto PO generations, while manual sourcing handle bigger work load with only 3.5% productivity. Re-allocating resource from manual sourcing to strategic sourcing team and productivity improvement on manual sourcing team will enable the best fit solutions. Implementing the business solutions will enable to improve the overall PO cycle time to the target of 19 days. This achievement is expected to improve material availability at site and allow maintenance work done timely. Consequently, plant reliability could be improved to support higher production target.