PROPOSED LAND MANAGEMENT SYSTEM USING FRAMEWORKS OF THE BALANCED SCORECARD COMBINATION WITH PRISM PERFORMANCE INDICATOR VERIFICATION STUDY CASE PT. XYZ

• Main Author: Yusuf, Mohammad
• Format: Theses
• Language: Indonesia
• Subjects: Manajemen umum
• Online Access: https://digilib.itb.ac.id/gdl/view/62442
• Institution: Institut Teknologi Bandung

PT. XYZ is the biggest coal mining company in Indonesia. XYZ's operational location is in Kalimantan Timur. XYZ's coal mine has a concession area of 80,000 hectares which was established in 1980s. XYZ employees reaches approximately 25,000 personnel (includes contractors). The main focus of XYZ’s mining operational activities was environmental, social, and governance in Good Mining Practice to minimize the impact of its operational activities. In order to anticipate global needs of coal, PT. XYZ had to increase its production. In line with the increase in production, the need for Land Management becomes crucial. External Affairs and Sustainable Division as a Division that has a mandate in Land Management is at the forefront of providing land for XYZ’s operation. In carrying out its duties the Department of Land Management (LM) has many obstacles, so that several times it has difficulty in improving its performance. From 2016 to 2020, the actual number of Land compensated unmatched with the number plan requested by the Mine Planning Division. There was a difference of about 20% on average the amount of Land compensated was not achieved. This was caused by several things that greatly affect the Land compensation process. Likewise in terms of the cost of Land compensation where the budget provided did not reach the planned budget from Mine Planning Division had been calculating the cost of this condition, which was if LM Department fails to provide land that had been planned by Mine Planning, it will cause additional costs due to changes in the Mine Plan such as: added longer Road Construction costs (due to shifting), additional excavation costs due to moving to a higher stripping ratio area (more excavated soil), additional fuel costs due to longer machine turning. The higher Land Price than the planned Land Price also causes cost for XYZ. The discrepancy in the amount of Land compensation provided by the Land Management Department with the Plan requested by Mine Planning causes additional costs for XYZ's operations. This reduces the profit earned by XYZ's mining operations. To determine the root of the problem, writer will use Fishbone Diagram Analysis or Ishikawa Diagram is an analysis tool that provides a systematic perspective on the causes and effects that arise or have a contribution to an effect. Based on the result of interview and FGD (Focus Group Discussion) of Land Management Manager and Superintendents and using the analysis of Fishbone Diagram, it is found that the root causes of problems of unachieved target (under performance) of land compensation are due to Time Process Land compensation, Man Power, Procedures, Policies, Unmatched price. Therefore in order to solve the root cause of the problem, writer will use The Balanced Scorecard (BSC) Performance Management System. The BSC can be used to address many of the barriers to effective strategy execution. The Balanced Scorecard focuses on an integrated system of key performance indicators for critical success factors which divided into: Activity Measures (Internal Business Process Perspective and Learning and Growth Perspective) and Outcome Measures (Customer Perspective Financial Perspective). The object of land compensation process was community or human. Therefore writer require another additional frameworks in Performance Management Systems that is Prism Performance Management Indicators. The Prism will confirmed the BSC to ensure the satisfaction of stakeholder in the compensation process. The purpose of research is to create a new Performance Management Systems that combine The Balanced Scorecard (BSC) and The Prism Performance management to improve Land Management Department Performance in Land compensation Process. The New Combine Performance Management System will proposed 4 layers of reporting that consist of 37 Key Performance Indicators (KPI) which developed from vision, mission, strategy, indicators, targets and initiative of the land compensation process. The Report will be integrated in dashboard systems application that can be updated and monitored real time by XYZ management. The implementation of this Combine Performance Management System will solved the land compensation problem by improving the Performance of Land compensation.