BUDGET ESTIMATION TECHNIQUE ON ROTATING EQUIPMENT SERVICE WORKSHOP AT PT. RES.

• Main Author: Slamet Wiharjo, Iman
• Format: Theses
• Language: Indonesia
• Subjects: Manajemen umum
• Online Access: https://digilib.itb.ac.id/gdl/view/55276
• Institution: Institut Teknologi Bandung

Rotating Equipment is a term generally used in the oil and gas and process industries to describe mechanical components that use kinetic energy to move fluids, gases, and other process materials. These include, but are not limited to, engines, compressors, turbines, pumps, motors, generators, blowers, and gearboxes. PT. RES is one of the companies in the business of rotating Equipment services provider, providing Services in Maintenance, Repair and Overhaul for customers in Indonesia and Asia Pacific region. PT RES has been facing vast challenge on projects margin that declining below target which affecting company revenue. The poor projects margin performance needs to be rectified to avoid further impact on company profitability, the business issue exploration in this research covers the contributing cost overruns and the current budget estimation technique accuracy. The proposed budget estimating technique expected to improve the estimation accuracy for estimating reserves and contingency both identified an unidentified risk using three-point estimation technique and R-value determination for estimating risks cost. In addition to that there are also improvement recommendations that can be applied as possible and feasible effort to improve cost efficiency and projects continuous improvement. The data used and presented in this final project are both primary data acquired from the company and from author’s study in the company internal and based on the author’s perspective as one of the Project Managers in PT. RES in addition to the brainstorming together with few key department managers. This final project proposes a solution for proper budget estimating process which is a highly critical and require a proper estimating technique and feedback mechanism to continuously learn and improve accuracy. The proposed estimating technique approach is using a combination of Three-point estimate and Risk Cost on WBS Level, Risk Register and Management reserve on scope of work level. In addition to that, budget estimation requires synergic continuous improvement initiatives to minimize deviation contributors and facilitate continuous improvement initiatives from all employees to contribute to cost efficiency efforts which favor overall project and company profitability. The implementation of the proposed solutions and recommendations in this research shall not only to benefit the budget estimation accuracy but also facilitate PT.RES organization to break the “working in silos mentality”. The Implementation plan is scheduled within approximately one year to apply the new budget estimating technique approach and IT module collaboration to facilitate estimating department for baseline, statistics, and history reference, as well as to implement Management commitment to establish the proposed recommendations.