Procurement and Supply Chain Management in A Petroleum Company in Indonesia: A Case Study

• Main Authors: Danurwendo Arief Danurwendo A.S.W., 王威宏
• Other Authors: Jimmy Chung-Cheng Huang
• Format: Others
• Language: en_US
• Published: 2010
• Online Access: http://ndltd.ncl.edu.tw/handle/38765823010072168895

碩士 === 南台科技大學 === 企業管理系 === 98 === The Indonesian petroleum industry faces various challenges in developing production-related operational efficiencies. The inefficiencies identified are mostly related with short of regional and national planning among oil and gas operators, under-utilization of facilities, redundancy efforts, short of shared information and little or no measurement of performance. This condition has made Indonesia to become the most expensive country in terms of average operating cost per barrel oil in the region. As consequences of that the highly efficient SCM system is crucial to be implemented. Supply chain management in the petroleum industry contains distinct challenges, especially in the procurement area. Procurement holds an important part in oil and gas supply chain activity. Every petroleum company, particularly in Indonesia, always has procurement division. However, procurement issues and problems in the petroleum industry are not so pronounced as in other sectors due to the small number of players and the need to maintain good image, reputation and goodwill amongst them. This paper also discusses the condition of procurement regarding the implementation of Indonesian new regulation in oil and gas or petroleum sector. The objective of this paper is to shed some lights on the supply chain challenges and to improve procurement strategies in the petroleum industry. Finally, a case study is introduced to show the real problem that frequently happen in Indonesian supply chain activity especially in petroleum sector. Root Cause Analysis is conducted for performing the empirical investigation and analysis to determine the main problems in PIXI (not real name) supply chain activity. This method includes: (1) problem identification and description, (2) determination of possible causes, (3) cause verification, and finally (4) solution development. This was done through interviews of PIXI SCM staff, BP MIGAS and selected internal users based on the established interview guide. Further, brainstorming provides the identification and verification of possible root causes, as well as possible solutions.