Reducing overnight charges in the loading process of finished goods using FMEA method at PT. XYZ

Abstract

As a part of the supply chain, the logistics department plays a crucial role in the operational activities of a company. Like other departments, the logistics department also incurs costs that do not add value, such as overnight charges. Failure in the loading of finished goods process can result in a dwell time exceeding 18 hours per vehicle, leading to overnight charges. This occurrence can be prevented by identifying risks and failure modes using Failure Mode and Effect Analysis (FMEA). The FMEA methodology is widely utilized across various industries, including manufacturing, for product development. Additionally, FMEA is frequently employed in failure analysis in service industries, food services, construction, mining, agriculture, and healthcare. The research was conducted to identify failure modes and potential causes in the loading of finished goods process. In PT. XYZ, there are five finished goods storage areas. From the process of weigh-in time, loading finish goods, and weigh-out time, 25 activities were analyzed, and seven activities with the highest Risk Priority Number (RPN) were selected for solutions. The activity with the highest RPN, scoring 512, was the queuing of trucks exceeding loading capacity. The why-why analysis technique was employed to assist in finding solutions. From the seven activities with the highest RPN, 9 solution plans were derived. The recommendation to reduce queue trucks is to organize and monitor the vehicles dispatched by the Freight Forwarder. As a result, the dwell time per vehicle decreased from 9.23 hours to 6.36 hours, and the overnight charges reduced from 148,145 USD to 12,345 USD