INTERNAL QUALITY DEFECT REDUCTION AT PT INDONESIA TRC INDUSTRY

• Main Author: Indra
• Format: Theses
• Language: Indonesia
• Subjects: Manajemen umum
• Online Access: https://digilib.itb.ac.id/gdl/view/56849
• Institution: Institut Teknologi Bandung

In fiscal year 2020, TRC's internal defect rate could not reach its target, set at 1% or less. The consequence of not being able to achieve this internal defect rate will also increase other costs (hidden costs) along with it. One of which is the increasing of segregate and rework costs. This segregate and rework quantity is about 14% of the total production. Under such conditions, it is estimated that the total costs arising will be around USD 1 million in fiscal year 2020. This quality problem needs urgent improvement because, it is feared that this condition is getting worse in the following years so it could cause financial problems in the future. Facing business situation which is currently under VUCA (volatility, uncertainty, complexity, and ambiguity), coupled with the Covid-19 pandemic, every company has to increase its improvement effort in order to survive, e.g. internal cost reduction. Likewise with PT Indonesia TRC Industry (TRC), although based on its financial ratios data, there is no big problem with this company. TRC, a 24-year-old foreign company (Japanese) located in EJIP Industrial Park Cikarang Bekasi, is a manufacturing company that produces parts which mostly for Epson printers. Author conducted a study to find the root cause of this high internal defect rate problem. The root cause analysis (RCA) method used by author is the current reality tree (CRT). The results of the root cause analysis and identification were 4 (four) main root causes concerning humans (2 root causes), machines and equipment, and procedures. Then, for each root cause, options of solutions are identified. To determine which solution to choose, the analytical hierarchy process (AHP) method is used. It is hoped that the solutions of this high internal defect rate problem proposed by author will help TRC reduce its costs, estimated to be 50% of its total costs or about USD 500.000 per year. However, to implement this solution, a sufficiently large fund sources are needed and could not be covered by its internal funds, so TRC has to find external fund sources.