SAVING HEURISTIC IMPLEMENTATION IN PT PUPUK KUJANG BY TAKING CASE OF PUSKUD JABAR’S DISTRIBUTION SYSTEM FINAL PROJECT
By Sekar Hapsari 19004019
Undergraduate Program School of Business and Management Institut Teknologi Bandung 2007
SAVING HEURISTIC IMPLEMENTATION IN PT PUPUK KUJANG BY TAKING CASE OF PUSKUD JABAR’S DISTRIBUTION SYSTEM FINAL PROJECT
Name : Sekar Hapsari ID No : 19004019 Examination Date : August 6th 2007 Graduation Date : October 27th 2007 Undergraduate Study Program of Management, Institut Teknologi Bandung 2007 Supervisor : Togar M. Simatupang, Ph.D.
ABSTRACT Logistic process plays an important role in daily activities. The basic function of distribution management is delivering product from the place where its produce to the place where it is used, including physical activities such as storage and shipping goods, or non-physical activities such as information processing and service to the customers. This function makes a good service to customer, and can be seen on achieved Customer Service Level, completeness of the product in customer’s hand, and satisfied after-sales services. Distribution management system not only concern about delivering product from producer to the endusers but also covers the routing plan and delivery schedule to fulfill customer’s demand. Vehicle Routing Problem (VRP) is a combinatorial optimization problem seeking to service a number of customers with a fleet of vehicles. One of solving method in VRP is Saving Heuristic. This method could reduce the total distance by merging several routes into one route, therefore the ease of total distance give a good impact to total distribution cost, that consist of fixed cost and variable cost. In solving problem using Saving Heuristic method, the first step is determining the distance of each customer’s location. Secondly, make the list of saving that contains only one saving value for each pair of different customers. After that, rank the saving value with non-increasing fashion, which sorted from the highest saving to the lowest saving. This list is used to merge feasibly a pair of routes. Thirdly, define the new route by extracting from the top of the list and merge the customer’s location that possible. If the locations are not possible to be merged, then try to merge with another route that located in the same cluster. By using Saving Heuristic method, the total distance decrease 1,175 km, and the route are reduce from 11 routes to 5 routes. Since the reduction of total distance, the total cost is also decrease in amount of Rp 2.437.500 with 94.2% fleet utilization.
Keyword: Vehicle Routing Problem, Saving Heuristics i
PENERAPAN SAVING HEURISTICS DI PT PUPUK KUJANG DENGAN MENGAMBIL STUDI KASUS SISTEM DISTRIBUSI PUSKUD JABAR TUGAS AKHIR
Nama : Sekar Hapsari No ID : 19004019 Tanggal Ujian Akhir : 6 Agustus 2007 Tanggal Wisuda : 27 Oktober 2007 Program Studi Sarjana Manajenen, Institut Teknologi Bandung 2007 Pembimbing : Togar M. Simatupang, Ph.D.
ABSTRAK Manajemen sistem distribusi tidak hanya meliputi penyaluran barang dari produsen kepada konsumen saja, tetapi juga meliputi pengaturan jalur distribusi dan penjadwalan pengiriman produk untuk memenuhi kebutuhan konsumen. Vehicle Routing Problem (VRP) adalah suatu metode yang dapat mengoptimasi layanan pengantaran produk kepada konsumen menggunakan beberapa armada. Salah satu metode dalam VRP adalah Saving Heuristic. Metode ini menghasilkan penghematan jarak total dari keseluruhan jarak tempuh dengan menggabungkan beberapa jalur pengiriman produk menjadi satu jalur, sehingga dapat menghemat biaya distribusi baik dari segi biaya tetap maupun biaya variable. Dalam memecahkan permasalahan dengan menggunakan Saving Heuristic, langkah pertama yang dilakukan adalah mengetahui jarak antar setiap lokasi konsumen (node). Langkah kedua adalah menghitung penghematan yang dihasilkan apabila terjadi penggabungan dua buah jalur yang berbeda tujuan menjadi satu jalur. Hasil yang didapat kemudian diurutkan dari yang paling banyak menghasilkan penghematan, sampai yang paling sedikit. Setelah diperoleh daftar ranking, langkah ketiga adalah menentukan jalur yang harus dipilih sesuai dengan urutan dalam daftar ranking, dan masing-masing permintaan yang akan diantarkan tidak boleh melebihi kapasitas armada dalam satu kali angkut. Metode ini juga mempertimbangkan lokasi konsumen, apabila dari daftar penghematan terdapat lokasi konsumen yang berjauhan, maka kedua lokasi tersebut tidak memungkinkan untuk berada dalam satu jalur pengantaran. Dengan metode tersebut diperoleh pengurangan jalur yang semula berjumlah 11 jalur menjadi 5 jalur pendistribusian. Dari segi jarak tempuh, Saving Heuristic menghasilkan pengurangan 1.175 km, penghematan biaya distribusi sebesar Rp 2.437.500 dengan efisiensi pengangkutan sebesar 94,2%.
Kata kunci: Vehicle Routing Problem, Saving Heuristics iii
FOREWORD
First of all, the author grants a very special thanks to Allah SWT. Without his blessing, this final report will not finish smoothly. Also the family: Mom, Dad, Sarah, Kosha and Gita for all the supports. This final project is about Saving Heuristics Implementation in PT Pupuk Kujang by Taking Case of PUSKUD JABAR’s Distribution System. Also the author would like to thank the following individuals and groups: Mr. Togar M. Simatupang The greatest supervisor, for his assistance in the development of this final project through his careful, patience and thoughtful review. All SBM Family
Lecturers (esp. Mr. Dermawan Wibisono as my counselor and Mr. Mursyid Hasan Basri as my examiner).
Tutors (esp. Mr. Akbar, Mr. Adit, Mrs. Bertha and Mrs. Nita)
Administration staff (esp. Mr. Iwan, Mr. Yayat, and Mrs. Ikum).
Library staff (Mr. Radjab and Mrs. Wiwiek).
All SBM 2007 students.
My teachers in SDN Merdeka 5/VI Bandung, SMPN 22 Bandung, and SMUN 8 Bandung. Mr. Idih Ruskanda and family, for giving me an opportunity for doing research in PT Pupuk Kujang. God bless you. PT Pupuk Kujang Cikampek (esp. Mr. Ujang, Mr. Dadi, Mr. Kasimun, and Mrs. Imas). Insan Buana Prima Putra and family. Thank you for the meaningful supports, and for the priceless & precious moments in the last seven years. Love you. Ken Ratri Iswari, thank you for everything, you gave me much inspirations and suggestions. Alamanda Team: Yoan Eldilian, Bunga Indah Asmara, Riri Heryanti, Annisa Anastasia, Ratih Novrita Sari, Avanty Adzanny, v
Astri Ayuningtyas, S. Latifa R. Luddin, Hardi Pramudia, Panji Dwi Asmara, Ardhi Agung Pradana, Gebyar Pandito. Skinnies: Furry Windie Hapsari, Aulia W. Chamdun, Winna Meidyana, Rany Aulia. Ria Amalia, Hilmy Asri Sofiah, R. Viki Pratiwi Putri, Windarti Krisdiana, Rina Wulandari, Amalia Rachmawati, Nur Anugerah.
While there are many other individuals and groups that can not mentioned here, the author also owes a lot of special thanks. Last but not least, hopefully this final project reports will bring benefits to all of us. As human beings which lack of perfection, this final report is not free from human errors, therefore suggestion is needed for improvement.
Bandung August 1st 2007
Sekar Hapsari
vi
LIST OF CONTENT
ABSTRACT (ENGLISH)
i
ABSTRAK (INDONESIAN)
iii
FOREWORD
v
LIST OF CONTENT
vii
LIST OF IMAGES
ix
LIST OF TABLES
x
LIST OF APPENDIX
xi
CHAPTER I INTRODUCTION 1.1
Background
1
1.2
Problem Statement
2
1.3
Objective
3
1.4
Scope of the Research
3
1.5
Systematic of Writing
4
CHAPTER II STUDY OF LITERATURE 2.1
Supply Chain
5
2.2
Transportation and Distribution Management
5
2.3
Vehicle Routing Problem
7
2.4
Heuristics and Analytics
7
2.5
Travelling Salesman Problem
7
2.6
Nearest-neighbor Heuristic
8
2.7
The Node Routing Problem with Capacity and Length
2.8
Constraints
9
Constructive Heuristics
9
CHAPTER III RESEARCH METHODOLOGY 3.1
Research Stages
13 vii
3.2
Preliminary Study
14
3.3
Problem Statement
14
3.4
Purpose of the Research
14
3.5
Study of Literature
14
3.6
Data Collection
15
3.7
Data Analysis
15
3.8
Conclusion and Implementation Plan
16
CHAPTER IV DATA COLLECTION AND ANALYSIS 4.1
Company Profile
17
4.2
Business Process
19
4.3
Existing Distribution System
23
4.4
Shortcoming of Existing Distribution System
28
4.5
Proposed Solution
28
4.6
Analysis
35
CHAPTER V CONCLUSION AND IMPLEMENTATION PLAN 5.1
Conclusion
39
5.2
Implementation Plan
39
5.2.1 Initiation
39
5.2.2 Socialization
42
5.2.3 Milestone and key Performance Indicator
42
5.2.4 Evaluation
43
REFERENCES
45
APPENDIX
47
viii
LIST OF IMAGES
Figure 2.1 Supply chain simplification model
5
Figure 2.2 Computation of saving routes
10
Figure 2.3 Merging two routes in a single route
11
Figure 3.1 Research methodology diagram
13
Figure 4.1 Distribution process from manufacture to end-users
22
Figure 4.2 Price procedures at distributor’s stage
23
Figure 4.3 Current distribution routing system
26
Figure 4.4 New routes based on Saving Heuristic method
31
Figure 4.5 Illustration on Microsoft Excel sheet view
33
Figure 4.6 Illustration on Microsoft Excel sheet view
34
ix
LIST OF TABLES
Table 2.1 General Evaluation of transportation mode
6
Table 4.1 Business process at PT Pupuk Kujang
21
Table 4.2 List of retailer’s location
27
Table 4.3 Distance between retailer’s locations
27
Table 4.4 Saving Value
29
Table 4.5 List of ranking from saving value
30
Table 4.8 Comparing existing and proposed system
35
Table 5.1 Safety stock in proposed distribution system
40
Table 5.2 Proposed delivery schedule in May 2007
41
Table 5.3 Milestone of implementation plan
42
Table 5.4 Key Performance Indicators
43
x
LIST OF APPENDIX
Appendix A A1. Total cost of current distribution system and load efficiency
49
A2. Total cost of new distribution system and load efficiency
53
A3. Safety stock calculation
55
Appendix B Copy of Government Regulations
59
xi
VALIDATION PAGE
SAVING HEURISTIC IMPLEMENTATION IN PT PUPUK KUJANG BY TAKING CASE OF PUSKUD JABAR’S DISTRIBUTION SYSTEM
By Sekar Hapsari ID No: 19004019
Undergraduate Program School of Business and Management Institut Teknologi Bandung
Validated by
(Togar M. Simatupang, Ph.D.)
