Material management is one of the main components in the management of all types of companies. Material management plays an important role in supporting the company's performance, which relates to customer satisfaction, cost of production and financial performance. Ruauw (2011) stated that the raw materials required should be sufficient available so as to ensure smooth production. However, should the quantity of inventory it should not be too large so that capital tied up in inventory and costs. Meanwhile the inventory is not too big and not too small anyway because can slow down the production process. Failure materials inventory control default will cause a failure in obtaining profit. It is important for every company held inventory control to obtain the optimal inventory levels to maintain a balance between the cost of inventory too much to the cost of inventory too little.
PT Pembangkitan Jawa Bali (PJB) is one of state enterprise which manages some power plants in Indonesia. PJB has various types and characteristics of power plants which scattered throughout Java and Bali. PJB is responsible for managing power plants in the region of the island of Java and Bali with certain key performance indicators. In a power plant operational management, there are two Key Performance Indicator. Initially, the availability of power plants to produce electricity and the reliability of power plants.
The first key performance indicator stated as the availability power plant to produce electricity. This number of availability is called Equivalent Availability Factor (EAF). Then, the reliability of power plant formulated as Equivalent Force Outage Rate (EFOR). This number of EFOR reflected the long duration of unplanned shutdown of power plant in certain period. To improve and maintain availability and reliability of power plants, required a correct and proper maintenance program. In the company’s operational, PJB managing several resources, one of them is management of materials. To obtain the company’s goal, in the material management operations, currently PJB uses the ABC Analysis method to control the inventory that has been conducted since 2007.
Abuhilal (2006) stated that the ultimate goal of inventory management is giving satisfaction to the customers need at the lowest price. There are two types of customer, internal customer and external customer. In company’s operation, PJB only has internal customers of inventory management, there is maintenance division. The key performance indicator of customer satisfaction is determined as a number Work Order which delayed which caused by unavailable spare part.
According to the CEO decree, now PJB using three classification stock keeping unit to maintain more than 30.000 item of materials. The first classification is the impact of material to power plant operation, then the lead time of delivery and the last classification is about usage value every year (price multiplied by...