Operational Excellence Implementation in Wood Industry (Case Study: PT XYZ)

Abstract

Indonesia's wood industry is projected to improve in 2019. However, some challenges are facing the wood processing industry such as increase of raw materials cost, production cost, labor wages, and additional expenditures. Customer also require shortened lead time, higher quality, and more diverse product. In order to face those challenges, one of strategy that can be developed by the company is operational excellence strategy. PT XYZ is one of the leading wood industries in Indonesia, which already have their operational excellence model. This research is aimed to measure the implementation of operational excellence at PT XYZ based on XEM (PT XYZ's operational excellence model), as well as formulating recommendations for continuous improvement. The result showed that the two lowest scores are implementing basic problem solving (67% according to manager and 75.7% according to supervisor) and hourly report (65% according to manager and 77.5% according to supervisor). In term of implementing basic problem solving, the lowest attribute score is on implementing 5 Why analysis, whereas for the hourly report the lowest attribute score is on foreman monitoring. Based on those result, the recommendation for implementing basic problem solving is to revise the 5 Why analysis becomes 3 x 5 Why analysis and to provide training on increasing problem solving skill. Recommendation for implementing hourly report is to revise the foreman weekly progress report by adding the hourly report monitoring and to provide training on increasing foreman awareness about the importance of monitoring hourly report. Different scoring result has been found between managers and supervisors. Therefore, the communication between them must be improved.