Optimization of Work-In-Process Inventory Through Filling Activity In Chevron Pacific Indonesia Company

Abstract

Chevron Pacific Indonesia Company (CPI) is one example of industry that implies Vendor Managed Inventory (VMI) technique where the production systems controlling the inventory. In this company, Filling and Loading appears as an operational activity toward Work-in-Process inventory system. Filling deposit the crude oil which camefrom the oil productionfield into the storage tank, until it is beingshippedthrough the loading. The loading will follow the 5 days shipping schedule that already being determined before by in charged parties. This research presents an algorithm model under VMI concept tofind the bestfilling strategy to avoid shipment delay. The current condition in the company shows that delay and inconsistency of shipping schedule occurs in some conditions, due to insufficient amount in theirstorage tank By using the algorithm model proposed by this research, it will provide the bestfilling strategy which defines when, whereand how much to locate the crude properlyso no more shipment delays. KEYWORDS: Vendor Managed Inventory, Filling and loading activity, Algorithm