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Alva Edy Tontowi
Department Of Mechanical And Industrial Engineering, Universitas Gadjah Mada, Yogyakarta, Indonesia
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Effectiveness and Efficiency Improvement of Local Content at the Upstream Oil and Gas Industry by Employing Live Verification Method Rama Atyasa Y; Supriyatno Supriyatno; Alva Edy Tontowi
International Conference on Economic Business and Social Science Vol. 3 No. 1 (2025): Proceeding International Conference on Economic Business and Social Science (IC
Publisher : Publikasi Indonesia

Show Abstract | Download Original | Original Source | Check in Google Scholar | DOI: 10.59141/icebss.v3i1.33

Abstract

This study examines the impact of live verification as an innovative approach to local content verification at PT Pertamina Hulu Energi (PT PHE), by comparing its efficiency and effectiveness against conventional verification methods. By analyzing 207 contracts (verified in 2022-2024), this study documents the transition from conventional verification (50 contracts in 2022) to live verification (71 contracts in 2023, 77 contracts in 2024), with little retention of conventional methods (4 and 5 contracts respectively). By applying Business Process Re-engineering (BPR), this study aims to demonstrate significant process simplification, reducing verification steps from 9 steps to 6 steps and consolidating 4 steps into 1 step. Furthermore, statistical tests were conducted to validate the significant changes before and after the live verification method was implemented. Including homogeneity test and one-way ANOVA was chosen because it was considered suitable by involving three independent variables (2022, 2023, 2024) and the dependent variable which is verification time (SLA). Statistical validation through descriptive frequency analysis showed that the average verification processing time in 2023 (25,45 working days) and 2024 (14,55 working days) was getting closer to the ideal benchmark. Furthermore, homogeneity testing and one-way ANOVA confirmed a statistically significant improvement, with significance values of <0.001 (by mean) and 0.001 (<0.05 for ANOVA), indicating a substantial reduction in SLA post-implementation. Then the implementation of verification is measured by the effectiveness test and the results show that in 2023 & 2024 the live verification process is considered effective with a cumulative achievement rate of 32%, and in terms of efficiency it is considered efficient with a cumulative achievement rate of 87,18%. This live verification method can be an effective solution to speed up the local content verification process and help solve problems in the local content verification process. The findings underscore live verification as a transformative strategy, improving process agility, cost efficiency, and compliance performance. This research contributes to the production process literature by offering a data-driven framework for process optimization, as well as actionable insights for energy sector policymakers and potential scalability in the context of global supply chain compliance.
Co-Authors Agus Windharto Almy, Raeshifa Diani Amanda Nur Cahyawati Ambar Pertiwiningrum Andi Sudiarso, Andi Andy Nurul Yunita Pettalolo Angger Bagus Prasetiyo Anggita Gigih Wahyu Iriawan, Anggita Gigih Wahyu Anna Maria Sri Asih Aoyama, Hideki Arie Kurniawan Arie Kurniawan Arif Kusumawanto Arif Kusumawanto Arman Hakim Nasution Avin Fadilla Helmi Banu Santoso Bhawika, Gita Widi Budhi Sholeh Wibowo Budi Hartono Budi Hartono Budi Rochardjo, Heru Santosa Catur Sugiyanto Dawal, Siti Zawiah Md Dawi Karomati Baroroh Deendarlianto Dhananjaya Yama Hudha Kumarajati Dian Pribadi Perkasa Djoko Kuswanto Djoko Kuswanto Erizal Erizal Erni Suparti, Erni Ghazali, Ihwan Handiwibowo, Gogor Arif Hari Agung Yuniarto Herianto Heru Santoso Budi Rochardjo, Heru Santoso Budi Hideki Aoyama Ibnu Abdul Rosid IDAA Warmadewanthi Ihwan Ghazali Indarto Indarto Indrajati, Heppy Riani Jamasri . Joko Sedyono, Joko Joni Setiawan Joni Setiawan Kusmono Lilik Soetiarso Lina Dianati Fathimahhayati, Lina Dianati Mahardhika, Syaqila Erie Margaretha Arnita Wuri Marlyana, Novi Marsetyawan Heparis Nur Ekanda Soesatyo Marsetyawan HNE Soesatyo Mochammad Andy Rizqy Mochammad Noer Ilman Mochammad Taha Ma’ruf Mohamad Khoiru Rusydi Muhammad Kusumawan Herliansyah Muhammad Ridlwan Muhammad Shodiq Abdul Khannan Novi Marlyana Nugraha Muharafandy Nur Aini Masruroh Perttalolo, Andy Nurul Yunita Prabowo, Teguh Ari Putra, Gaustama Putra, Ikbal Rizki Raeshifa Diani Almy Rahardyan Magetsari Rahmanto, Nurdin Rama Atyasa Y Rashid, Salwa Hanim Abdul Rudy Firman Prakosa Salwa Hanim Abdul Rashid Sella Antesty Siti Afiani Musyarofah Siti Sunarintyas Siti Zawiah Md Dawal Slamet Widyanto, Slamet Soedarmanto Indarjulianto Soedarmanto Indarjulianto Soetiarso, Lilik Supriyatno Supriyatno Susilo Adi Widyanto Syawaluddin Adha Pohan Taufik Hidayat Taufik Hidayat Teguh Ari Prabowo Titis Wijayanto Tri Purwanti Wangi Pandan Sari Widiastuti, Maria Goreti Widowati Siswomihardjo Widyanto, Slamet A. Widyastuti Widyastuti Windharto, Agus Wiratni Wiratni, Wiratni Yanti Pasmawati Yeni Yustisia