Design Improvements to Inbound Logistics and Outbound Logistics Process Groups using the Plan-Do-Check-Act (PDCA) and Multi-Moment Analysis (MMA) Approaches

Abstract

The object of this research is a company engaged in services and fabrications of sheet metal-based products. The management wants to increase the profits. One of the divisions that management wants to improve is the Logistics Division. Over the past few months, there has been an increasing trend of overtime in the Logistics Division that indicates an increase in operational costs for workers. The occurrence of overtime indicates that there are worker activities that are not adding value or so-called waste. In the lean concept, waste is something that must be eliminated. Thus, this study aims to reduce waste in order to reduce costs so that the company obtains an increase in profits. The Plan-Do-Check-Act (PDCA) was used as an improvement framework for this research. Then, Multi Moment Analysis (MMA) methodology will be used to document the process and measure the level of waste. The outputs from this research are process mapping, dashboards, and proposed solutions for improvement. Proposed improvements are designed for each inbound and outbound logistics process group in Logistics Division in line with the management concern. The proposed improvement for inbound logistics estimates a reduction in overtime of 43% or equivalent to cost savings of up to Rp23,948,597.8 per year. Meanwhile, proposed improvements for outbound logistics can potentially reduce overtime by up to 47.55% which is equivalent to cost savings reaching Rp36,315,157.5 per year.