2011 Benchmarking Report Indonesia
-
Upload
rjyparraguirre8243 -
Category
Documents
-
view
20 -
download
0
Transcript of 2011 Benchmarking Report Indonesia
TITLE
A REPORT IN FULFILMENT OF THE BENCHMARKING STUDY VISIT ON TQM AND QCC OF BENCHMARKED COMPANIES
DATE OF VIST
FEBRUARY 27, 2011 – MARCH 05, 2011
LOCATION OF VISIT
JAKARTA, INDONESIABANDUNG, WEST JAVA, INDONESIA
PREPARED BY
MR. CEZAR R. TRAVIÑA – BENCHMARKING COORDINATOR
PRESENTED TO
MINDANAO ASSOCIATION FOR QUALITY, INC.Through
MR. DOROTHEO O. LACBAIN JR. - President
PREFACE:
1
THE PRESENTER WISHES TO EXPRESS WITH DEEP GRATITUDE TO
EVERYONE WHO DIRECTLY OR INDIRECTLY FACILITATED IN MAKING THE
STUDY VISIT A SUCCESS. KUDOS TO INDONESIA QUALITY MANAGEMENT
ASSOCIATION (IQMA) AND THE PIONIR MAXIM MUTU INDONESIA (PT. PMMI),
TO THE REPRESENTATIVES OF THE HOST COMPANIES BENCHMARKED; PT
KRAMA YUDHA RATU MOTOR, PT INDOCEMENT AND PT JASA MARGA
PURBALEUNYI.
MEMBERS OF THE BENCHMARKING TEAM:
1. Dorotheo O. Lacbain Jr. – MAQ President
2. Elvira A. Cajigas – MAQ Vice President
3. Delilah L. Soliva – MAQ Secretary
4. Maria Lenna Luz U. Rizon – MAQ Treasurer
5. Jerson N. Orejudos – MAQ Auditor
6. Cezar R. Traviña – CQP Manager
7. Roly Ann A. Claro – Representative, PILMICO Foods Corporation
8. Caroline A. Neri – Representative, Province of Misamis Oriental
9. Estrella U. Pahalla – Representative, RTWPB Region 10
10.Gay L. Molina – Individual Member, MAQ Consultant
11.Concordia A. Roa – Individual Member, MUST
12.Roy L. Pamitalan – Individual Member, MSUIIT
13.Jingle B. Magallanes – Individual Member, MSUIIT
14.Evelyn I. Rivera – Office Staff, CQP
15.Neofita T. Japos – Guest, RTWPB Region 10
16.Marc T. Claro – Guest, Government Employee
17.Jesreel Gaza M. Traviña – Guest, Entrepreneur
2
CONTENTS:
PART I
INTRODUCTION ABOUT THE LOCATION
PART II
BENCHMARKING OUTPUT MEETING WITH IQMA
BENCHMARKING AREAS - HUMAN RESOURCE MANAGEMENT
- HOUSEKEEPING
- PRODUCTIVITY
- QUALITY ASSURANCE
- OCCUPATIONAL HEALTH AND SAFETY
- CUSTOMER CARE
PART III
LOOKING AHEAD
JAKARTA
Jakarta is the capital and largest city of Indonesia. Located on the northwest coast of
Java, it has an area of 661 square kilometers and a 2010 census count population of
3
9,580,000. Jakarta is the country's economic, cultural and political centre. It is the
most populous city in Indonesia and in Southeast Asia, and is the twelfth-largest city in
the world. The city's name is derived from the Old Javanese word "Jayakarta" which
translates as "victorious deed", "complete act", or "complete victory". The Japanese
renamed the city "Jakarta" during their World War II occupation of Indonesia.
Landmarks include the National Monument and Istiqlal Mosque. The city is the seat of
the ASEAN Secretariat. Jakarta is served by the Soekarno-Hatta International Airport,
Halim Perdanakusuma International Airport, and Tanjung Priok Harbour; it is connected
by several intercity and commuter railways, and served by several bus lines running
on reserved busways.
Administration
Officially, Jakarta is not a city, but a province with special status as the capital of
Indonesia. It has a governor (instead of a mayor), and is divided into several sub-
regions with their own administrative systems. As a province, the official name of
Jakarta is Daerah Khusus Ibukota Jakarta ("Special Capital City District of
Jakarta"), which in Indonesian is abbreviated to DKI Jakarta.
Jakarta is divided into five kota or kotamadya ("cities" - formerly municipalities), each
headed by a mayor, and one regency (kabupaten) headed by a regent. In August
2007, Jakarta held its first ever election to choose a governor, whereas previously
the city's governors were appointed by local parliament. The poll is part of a country-
wide decentralization drive, allowing for direct local elections in several areas.
Government
4
In September 1945, the government of Jakarta City was changed from the
Japanese Djakarta Toku-Betsu Shi into the Jakarta National Administration. This
first government was held by a Mayor until the end of 1960 when the office was
changed to that of a Governor. The last mayor of Jakarta was Sudiro, until he was
replaced by Dr Sumarno as Governor.
In 1974, Based on the Act No. 5 of 1974 relating to the Fundamentals of Regional
Government, Jakarta was confirmed as the capital city of Indonesia and one of
Indonesia's 26 provinces.
Economy and governance
Jakarta's economy depends heavily on financial service, trade, and manufacturing.
Industry includes electronics, automotive, chemicals, mechanical engineering and
biomedical sciences manufacturing. In 2009, 13% of the population had an income
per capita in excess of US$ 10,000 (Rp 108,000,000).
The economic growth of Jakarta in 2007 was 6.44% up from 5.95% the previous
year, with the growth in the transportation and communication (15.25%),
construction (7.81%) and trade, hotel and restaurant sectors (6.88%). In 2007, GRP
(Growth Regional Domestic Product) was Rp. 566.45 trillion. The largest
contributions to GDRP was by finance, ownership and business services (28.7%);
trade, hotel and restaurant sector (20.4%), and manufacturing industry sector
(15.97%). In 2007, per capita GRDP of DKI Jakarta inhabitants was an 11.63%
compared to previous year
A new law in 2007 forbids the giving of money to beggars, buskers and hawkers,
bans squatter settlements on river banks and highways, and prohibits spitting and
smoking on public transportation. Unauthorized people cleaning car windscreens
and taking tips for directing traffic at intersections will also be penalized. Critics of
5
the new legislation claim that such laws will be difficult to enforce and it tends to
ignore the desperate poverty of many of the capital's inhabitants.
BANDUNG
Bandung (pronounced [bənˈduŋ]) (Indonesian: Kota Bandung) is the capital of West
Java province in Indonesia, and the country's third largest city, and 2nd largest
metropolitan area in Indonesia, with 7.4 million in 2007. Located 768 m (2,520 ft)
above sea level, Bandung has cooler temperatures year-around than most other
Indonesian cities. The city lies in a river basin surrounded by volcanic mountains. This
topography provides a good natural defense system, which was the primary reason
for the Dutch East Indies government's plan to move the colony capital from Batavia
to Bandung.
The Dutch colonials first opened tea plantations around the mountains in the
eighteenth century, followed by a road construction connecting the plantation area to
the capital (180 km or 112 miles to the northwest). The European inhabitants of the
city demanded the establishment of a municipality which was granted in 1906 and
Bandung gradually developed itself into a resort city for the plantation owners.
Luxurious hotels, restaurants, cafes and European boutiques were opened of which
the city was dubbed as Parijs van Java (Dutch: "The Paris of Java").
Administration and demographics
The city area in 1906 was 19.22 square kilometers and by 1987 it was
167.2965 km². The city administration is divided into 26 subdistricts (kecamatan) and
139 villages (kelurahan). A mayor (walikota) leads the city administration. Since
2008, the city residents directly voted for a mayor, while previously mayors were
nominated and selected by the city council members or known as the Regional
6
People's Representative Council (DPRD). As of 2003, the total number of city
administration personnel is 20,163.
In 2005 the population was 2,290,464, with a density of 13,693 people/km².The May
2010 census count result is 2,393,688 people making it the third most populous city
in Indonesia, after Jakarta and Surabaya.
Most of Bandung's population are of Sundanese descent. Javanese is the largest
minority, from nearby province and the eastern part of Java. Minangkabau people are
also counted as significant minority. Notable minorities include Chinese Indonesians,
Indian Indonesians, and Korean Indonesians.
Economy
Bandung economy is mainly built upon tourism, manufacturing, textile/apparel,
education institutions, technology, retail, services, plantation/agriculture, financial,
pharmaceutical, food, among others. Those are the major investments and most
popular fields/industries being sought here.
Bandung has nearly 50 higher educational institutions and is among the most
popular destination for education in Indonesia. Creative-based culture has shaped
the basis of Bandung economy. The once quiet residential district of Dago has
become an important business and entertainment centre. Chic cafes and
restaurants are spreading out along Dago Street. In the early 1990s Cihampelas
Street became a popular clothing store location.
The distro sell stylish non-trademarked products, made by local designers. Books,
indie label records, magazines, fashion products and other accessories are typical
distro products. After their products receive large teenagers attention, then these
local designers make their own clothing company. Now, there are more than 200
local brand names in Bandung. Distro distance itself from factory outlet in term of its
7
philosophy. Distros come from individual designers and young entrepreneurs, while
factory outlet products come from a garment factory.
MEETING WITH IQMA OR INDONESIA QUALITY MANAGEMENT ASSOCIATION
Hosts: Mr. Idaris Simorangkir and Madam Rini Simorangkir
Venue: Grand Tropic Suites Hotel, Jakarta – 28 February, 2011
A semi-formal introduction was done between the hosts and members of the MAQ
Benchmarking Team headed by Mr. Dorotheo O. Lacbain Jr.. Exchanges of hellos’
and handshakes as a gesture of goodwill between two parties.
An opportunity for MAQ to touch base with an Indonesian National Productivity
Organization or Country NPO for the benchmarking exercise. Likewise, a network
can be created with IQMA to further enhance the MAQ understanding on the
Indonesian benchmarked companies Best Practices on TQM and QCC.
BENCHMARKING VISIT OUTPUT
HUMAN RESOURCE MANAGEMENT
RATIONALE
HR was considered as one of the benchmarking parameters on the premise that
people form part of an organization’s most valuable resources. The importance of
maintaining an efficient and productive workforce cannot be overemphasized to stay
8
in business. The ISO standards confirm this through the significance it attaches to
HR development as a contributory factor in making quality products / services.
Specifically, the areas, which the team wanted to benchmark, were on: how the company is organized : reporting relationships, hierarchical or
structural levels involved, and the influence of union
how the company is managed : management style, transparency of action,
openness of communication channels
how people are developed : training programs, development of skills and
competencies
how support mechanisms are set-up in terms of :
- hiring/keeping employees
- rewarding/recognizing employee contributions
- evaluating performance and how data is used
- promoting employee involvement
- measuring organizational health / climate
FINDINGS
The first visit to PT Krama Yudha Ratu Motor Company, this company adopts a
modular hierarchy structure where partially-autonomous modules linked by
standardized interfaces permit decentralized adaptation and innovation for each
department. It allows each department to independently decide its own efficiency
and resources allocation, which is very suitable for flexible manufacturing company.
The second visit to PT Indocement Citeureup Factory, the company follows the
Dual Frame Organization: Command and Control Framework on one hand and the
9
Work Coordination Framework on the other hand. To cite some peculiar
differentiations;1. Vertical & static view (school of management) for Command and
Control framework while horizontal & dynamic view (school of leadership) for Work
Coordination framework 2. Hierarchal (superior-subordinate relationships) for
Command & Control framework while coordinating (customer-supplier relationships)
for Work Coordination framework. Process team in the Dual Framework is quite
similar from most Philippine companies where, teams are linked to Company Vision,
Condition of Excellence and Key Management processes. By the third visit to PT
JASA MARGA (Persero) Tbk., it became apparent that there are issues, which are
either legally or culturally, bounded which make them unfeasible in the Philippine
setting. These may be sound practices but difficult to duplicate. To cite:
Union – In PT Krama Yudha Ratu Motor, union has a bigger influence in
many decision making e.g. in scheduling of working hours for productivity, the
management has to meet with the union. While in PT Jasa Marga, influence
of union is non-threatening to the company. In fact, all employees are
members of the union (from top to bottom) except the Board of Directors. Any
issue that may arise from operation is being discussed among members.
People dynamics – Across the three benchmarked companies, reporting
system is quite similar i.e., using the line of bureaucracy. Related to this, it is
observed that in order to motivate people to contribute improvement ideas,
the need for employee involvement, recognition and incentive programs are
integral part of company policy.
Observations for best practices:
10
Presence of system to take stock of HR skills : In PT Indocement, there is
the so called ‘Talent Management Matrix’ whereby, optimizing potential and
aligning into position. Performance versus Potential matrix is maintained to
keep track of employee training needs and actual skills acquired. A good
strategy for ensuring availability of competencies at all times. In PT Krama
Yudha Ratu Motor Company, the budget for training alone is 1.5mio IDR
per employee per year or equivalent to 7,500Php.
Compensation & Benefit : It was observed that in the three benchmarked
companies, employees are receiving much higher salary vis-à-vis the
government mandated minimum wage (1.2 mio IDR/month or 250Php per
day). However, one notable benefit which is distinct from Philippine taxation
scheme is that, employees at PT Jasa Marga enjoy almost non-taxable
income. The company shoulders the income tax of employees.
Executive Development Program : In PT Indocement, every executive of the
company will undergo the ‘Executive Development Program’. It is a one-year
course to build comprehensive managerial and business skills to strengthen
company competitiveness. This is jointly developed with lecturers from the
University of Indonesia.
Corporate Social Responsibility : This is one notable undertaking pursued by
PT Indocement: the company’s passion to take good care of its stake
holders. Livelihood program for both the employees and people living within
the area where the company operates. Conversion of several hectares of
land at the mining site to ‘Jatropha’ plantation (jatropha seed as an alternative
source of energy). Think, the company strength is their commitment to both
society and environment_ the 8 Millennium Development Goals; G1-
Eradicate extreme hunger and poverty G2- Achieve universal primary
education G3- Promote gender equality and empower women G4- Reduce
child mortality G5- Improve maternal health G6- Combat HIV/AIDS, Malaria
11
and other diseases G7- Ensure environmental sustainability and G8- Develop
a global partnership for development.
GOOD HOUSEKEEPING
RATIONALE
Good housekeeping is closely related to safety issues. Cleanliness promotes safety
and work efficiency. At the end of the line, it contributes to productivity and quality.
Benchmarking parameters are on:
how the company sets its standards for cleanliness: conscious effort to define
what levels of cleanliness are acceptable and not
how the company manages and disposes of waste materials: responsibility of
keeping the environment clean
how involved are the employees in the housekeeping activities of the company:
responsibility issue
FINDINGS
The general practice across the companies visited is being implemented both by
management and employees in fact, in PT Krama Yudha Ratu Motor the standard
of cleanliness is documented based on ISO 14001 Series of 2007. While at PT Jasa
Marga, they have the so called ‘Green Policy’ where application of Environmental
Department Regulation with reporting system every 6 months and the Prevention
Program based on Consultant report. At PT Indocement on the other hand, they
12
have this ‘Basic Concept of Indoor Cleaning Services’ a matrix on cleaning area
versus cleaning targets. The cleaning status is reported on the daily as well as
monthly basis.
Waste disposal management is strictly implemented due to stringent government
regulations. At PT Indocement, there is an Internal Waste Management divided by
two sections: Housekeeping / Maintenance and Laboratory / Polyclinic. The former
handles the domestic and hazardous wastes while the latter handles hazardous
liquid and infectious wastes.
Observations for best practices:
At PT Krama Yudha Ratu Motor one of the QCCs presented a project on ‘How to
Reduce Waste Generation from Canteen’ with successful implementation.
PRODUCTIVITY
RATIONALE
Productivity emanates from a concept that enables a company to: a) enhance
production output by utilizing available resources more effectively and efficiently in
order to provide customers more product value and b) provide its employees with an
expanded sense of personal satisfaction by opening new avenues toward personal
growth and advancement.
Benchmarking parameters are on:
What continuous improvement tools are used
13
What methods are employed in controlling cost
What types of measurement tools used in determining productivity levels
What are the interventions necessary to improve productivity
FINDINGS
Only two from the three benchmarked companies have clear productivity initiatives
because they are engaged in manufacturing while the third organization is a service
provider. In PT Krama Yudha Ratu Motor, assembler of Mitsubishi vehicle for
commercial purposes the Kaizen Lean Production: Kitting system is being employed
where teams engaged in major projects to improve production levels. Here, QCCs
reward/recognition and suggestion system can leverage to motivate people in
increasing productivity. Man hour per unit, OEE and Direct Run are measurement
tools in establishing production levels and targets. Today’s benchmark is
15Manhours per unit. Another notable figure for this company is their First Time
Capability or FTQ. Since 2007 up to 2010, the percentage increase is remarkable
from an average of 41% to 86% in four categories. A very challenging target was set
for 2011 at 90%. How? In-line quality check is done in every section; Body parts
stamping, pretreatment, cathode electro deposition, under & top coat, trimming, line
test and touch-up before delivery. Product complaint is nil (one complain in 2010 on
slight brake problem) and no product recall.
In PT Indocement, the plant capacity is 18.5Mio Ton against their 2010 production
volume of 12.9Mio Ton making Indocement the biggest cement producer in
14
Indonesia. This company uses several continuous improvement tools to support
productivity namely; QCC Tulta, One Sheet Project, Six sigma, PSS, PQI and SS.
QUALITY ASSURANCE
RATIONALE
It is understood that quality of the product or service is the responsibility of everyone
in the organization, especially line personnel who has the direct control on product
quality or services for that matter. Therefore, it is incumbent upon both management
and line personnel that all the planned activities, preventive or precautionary
measures are taken to ensure that the pre-defined quality of a product and services
will be reached.
Benchmarking parameters are on:
What are the methods in ensuring quality before products leave the plant
How product traceability is instituted
How quality audit is performed
FINDINGS
The three companies visited and even PT Jasa Marga (a tollroad operator) being a
service provider, all are ISO certified.
Both PT Krama Yudha Ratu Motor and PT Indocement although they are of
different product category, their quality assurance methodology are quite similar in
many respects. Example, quality checking conducted in every segment of the
15
process line, 100% quality assurance check in accordance to SOP. However, a
distinct system of keeping quality tests at PT Indocement which not applicable in
PT Krama Yudha Ratu Motor.
For product traceability, both companies are using Barcode system. CBU date for
PT Krama Yudha Ratu Motor while product sign code for PT Indocement.
OCCUPATIONAL HEALTH AND SAFETY
RATIONALE
It is believed that safety is everyone’s concern and in fact a universal gesture by
companies across. It is everyone’s duty to ensure that his/her actions or decisions
do not endanger the safety of himself/herself and of other persons in the work place.
For this reason, the participants take Occupational Health and Safety or OHSA as
one major consideration for observation during the life of the benchmarking visit.
Benchmarking parameters are on:
How safety committees are organized and structured
How accidents in the work place are handled
What is employee’s attitude towards safety
How are working conditions and environmental issues are addressed
16
FINDINGS
All the three benchmarked companies are ISO certified. It was observed that health
and safety programs are imbedded in the Company policy as in most companies in
the Philippines.
One notable observation from PT Indocement is, their Comprehensive Health
Program divided into 4 stages namely; preventive, promotive, curative and
rehabilitative. Company total manpower of 2,855, a dedicated Health Department
was created and manned by 72 staff ranging medical officers & aids, hygiene
patroller and general practitioners.
In safety, PT Indocement best practice perhaps is in their ‘Indocement Safety
Observation Program’ or I-SOP with adherence to 1) improving safety behavior
through observation and communication 2) intranet based web application and 3) 5
simple steps: Plan, Stop, Observe, Act and Report. With quite a large number of
employees, the company is augmented by the following safety initiatives; a) year-
round OHS training for all employees b) communication through brochures, safety
films & videos, OHS performance board, etc. c) consultation and participation
(safety talk) specially in Mining division d) safety administration/monitoring system
through; printing of daily inspection, generate summary report and generate status
log e) fire brigade section for; emergency response and maintenance of fire
protection equipment.
17
PT Indocement is a recipient of several national awards and recognition such as,
Golden Flag from Ministry of Manpower for safety management system and the
‘GREEN RATING’ from the Ministry of Environment, only two companies did
received this national award so far.
In PT Krama Yudha Ratu Motor, working condition at the assembly line is much
better than the other companies visited. The area is spacious although indoor but
open air. The 5S markings are very visible with pedestrian lanes for guests. Workers
are wearing prescribed uniform and PPEs at areas specified. The company has
adopted this year a socialize reward system for Zero accident in the form of cash
incentive.
CUSTOMER CARE
RATIONALE
Customer care is the lifeblood of any business. You can offer promotions and cut-
down on prices to bring in as many new customers as you want, but unless you can
get some of those customers to come back, your business won’t be profitable for
long. Therefore, customer care is all about bringing customers back. And, about
sending them away happy enough to pass positive feedback about your business
along to others, who may then try the product or service you offer for themselves
and in turn become repeat customers.
Benchmarking parameters are on:
18
How is feedback gathered from customers and how it is integrated into the
operation
How is customer complaint being handled
How customer expectations are ensured
FINDINGS
PT Krama Yudha Ratu Motor being an assembler, all units produced are brought to
the Marketing Division of the company. Its guarantee for costumer satisfaction is
ISO certification with in-line checks in every segment of the assembly line and the
shower test (systematic detection system on defective parts or non-conformance to
specification) before every unit leaves the plant.
In PT Jasa Marga, customer satisfaction can be measured through statistic growth
of road users although the growth and number of road related accident. Using 2009
versus 2010 statistic a 5.8% growth is significant and the number of road related
accident recorded in 2010 is nil. The best practice for benchmark is perhaps on road
repair. A hole on the road of about 5 inch-diameter will trigger repair or patch-up. A
laboratory or workshop module of 20 X 20 inches patch-up material is available and
it will 15 minutes to do the repair (excluding the preparation time).
In PT Indocement, there is this so called ‘STR’ system or Indocement ‘Semen Tiga
Roda’ Customers a) direct selling and b) indirect selling. Both are linked to;
Distributors, Ready Mix, Industry, Project/Developer, Oil Cementing and the
19
Government. It has an integrated online system to facilitate customers performing
the order. Segmentation of the customers is based on work fields or sectors.
Indocement provides various channels to gain feedback from customers. All
customers could contact Indocement via toll free, SMS or email and get the
response directly. To maintain relationship with customers, SMD conduct call/visit
and organize Distributors’ Meeting. Customer feedback is integrated into
Indocement operation: Sales & Marketing Division (SMD) is the gateway for all
customer inquiry, request and feedback. Based on those feedbacks, SMD will
coordinate with other Divisions to solve customer issues. They will respond with the
best solution and SMD will inform the solution to customers.
To ensure customer expectation is the primary task of Sales & Marketing Division to
do this, Customer satisfaction is calculated / measured by marketing research and it
is conducted through the year. The data will be a reference in executing or handling
the cases. The customer expectation is then reported to Dept., SMD Division
Manager and Management for actions/follow-up based on management policy.
Sales Department on the other hand, will arrange schedule of regular meeting/visit
with customers. On the visit, try to solve the cases/issues faced by customers. If
necessary, other division staff will accompany SMD to ensure that customers got the
best care and solution.
20
LOOKING AHEAD
Possibility of integrating the best practices benchmarked to the MAQ training
modules which are applicable and responsive to the needs of clients.
Best practices benchmarked can be replicated to corporate, government and
other institutions where applicable.
The process undertaken by MAQ Benchmarking Team can be a step-board in
making improvements to future benchmarking activities.
21