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MEASURING AND IMPROVING THE SUPPLY CHAIN
PERFORMANCE OF YOGHURT AGRO-INDUSTRY
Introduction:
Dairy farming companies (PPSPs) are defined by the Central Bureau of Statistics (BPS)
as companies that carry out breeding activities, cultivate dairy cows, and collect cow's milk
(BPS 2015). Gunung Gede Cattle Breeder Cooperative (KPS) is one of Indonesia's PPSPs
located in Sukabumi, West Java. The cooperative, which was established in 1999, is one of
nine PPSPs in the form of cooperatives that are still producing today. Not only engaged in
breeding and cultivating dairy cows and collecting cow's milk as raw material, KPS Gunung
Gede is also engaged in processing milk into derivative products. One of the milk derivative
products that KPS Gunung Gede excels in is yoghurt.
Currently, KPS Gunung Gede is experiencing a problem where the supply of dairy milk
as raw material for making yogurt does not meet the desired amount. This is due to the
reduction in the number of farmers as raw material suppliers. KPS Gunung Gede noted that in
2012, KPS Gunung Gede had 38 farmers with assets of 180 dairy cows while records in 2016
showed that the number of farmers dropped to 20 farmers with assets of 89 dairy cows. This
decline in the number of farmers and dairy cows means that KPS Gunung Gede does not have
enough raw materials to run the production process properly.
The main factors for the decline in the number of farmers are the shift in the function of
dairy cows to beef cows, insufficient capital for the production process, and the desire of
farmers to get a higher and more stable income. To overcome this, improvements need to be
made in various aspects of the KPS Gunung Gede yogurt agroindustry. One of the
improvement efforts that can be made is to improve the performance of the yoghurt agro-
industry supply chain itself.
A supply chain is three or more organizational or individual entities that are directly
involved in the up and down flow of products, services, finances, and/or information from the
source to the consumer (Mentzer et al. 2001). The upper flow of the supply chain is all about
suppliers, purchasing, and production lines while the lower flow of the supply chain is all
about sales and resource recycling. The principle function of the supply chain is to add value
to the product by moving the product from one location to another or by modifying the
product (Hidayat and Marimin 2014). The value-added process can be applied to quality, cost,
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transportation, product delivery flexibility, and innovation.
Before improving performance, it is necessary to measure the level of performance of
the ongoing supply chain. This is done so that the selection of alternative performance
improvement strategies is in accordance with the conditions and resources owned by the
supply chain. Supply chain performance measurement is a measurement of the efficiency and
effectiveness of the supply chain performance matrix. Efficiency is how precisely supply chain
resources are used to provide satisfaction to the customers Supply chain performance
measurement is needed to provide information on the extent to which the supply chain is
meeting its targets and to provide insight into the direction of management focus to improve
performance and competitive value (Birhanu et al. Supply chain performance measurement is
needed to provide information on the extent to which performance meets targets and provide
an overview of the direction of management focus to improve performance and competitive
value (Birhanu et al. 2014). Supply chain performance measurement also provides an
approach to identify performance tipping points to ensure supply chain strategies stay on
target (Chakra and Jaju 2015).
With better performance, the KPS Gunung Gede yoghurt agro-industry supply chain is
expected to be better able to provide guarantees to farmers in financial aspects such as
adequate capital and increased income, as well as guarantees of business continuity so that
farmers do not need to hesitate to make long-term investments in conducting business
activities.
Supply Chain Identification
Supply chain identification was carried out using the situational approach and Van de
Vorst's (2006) basic supply chain elements method. The situational approach is an analysis of
the actual condition of the yoghurt supply chain in Gunung Gede PSU. The production
process, product, and marketing scope are some examples of aspects identified by the
situational approach.
Van de Vorst (2006) divides the basic elements of supply chains into four: structure,
business processes, resources, and management. The supply chain structure explains the scope
of the supply chain and the roles of supply chain members as well as the agreements that
make up the supply chain network. Supply chain business processes are a series of structured
and measurable business activities to produce certain outputs for consumers.
then delivered to the consumer. Supply chain network management describes the coordination
to carry out processes in the supply chain by members.
Analysis of the supply chain mechanism was carried out by direct review of the field,
interviews with relevant supply chain actors, and study of data owned by the company. The
supply chain management analysis framework can be seen in Figure 3.
Supply Chain Management Performance Analysis
Measuring supply chain management performance is done using the SCOR (Supply
Chain Operation References) - AHP (Analytical Hierarchy Process) approach. SCOR
modeling provides a systematic approach to identifying, evaluating, and monitoring supply
chain performance. SCOR provides standardized definitions, terminology, and business
process metrics. SCOR modeling divides business processes into five: planning, procurement,
processing, delivery, and return. SCOR modeling allows organizations to benchmark and
develop themselves to improve their business process performance (Jamehshooran et al.
2015). AHP allows decision makers to take more rational steps by considering all information
related to criteria and alternatives so as to produce structured decisions (Ajalli et al. 2017).
The first stage of analysis is done by forming a hierarchical structure. The hierarchical
structure consists of five levels, namely the goal level, business processes, performance
parameters, performance attributes, and performance matrix. The goal level is the target to be
achieved. The business process level takes from the SCOR approach consisting of planning,
procurement, processing, delivery, and return. The performance parameter level consists of
quality, added value, and risk. The performance attribute level consists of reliability,
responsiveness, agility, and cost. The performance matrix level consists of orders fulfilled,
perfect goods condition, delivery accuracy, raw material acquisition cycle time, processing
cycle time, ability to change production capacity, production speed flexibility, processing
costs, and transportation and distribution costs.
Supply Chain Value-Added Analysis
Value added according to Coltrain et al. (2000) is the value addition that occurs in a
commodity because the commodity undergoes further processing. Bunte (2006) states that the
added value received by each actor building the supply chain is different. This is because
agricultural products are perishable and the supply chain flow is long. Product quality can
decline significantly along the flow and the income margin between supply chain actors is not
equally distributed (Marimin et al. 2010).
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Each supply chain actor gets a different percentage of the added value. The supply
chain must determine a fair profit for each supply chain actor. To do this, it is necessary to
analyze the total supply chain performance including added value (Marimin et al. 2010).
Value-added analysis in the supply chain is important to avoid gaps in value-added receipts
that can lead to the dominance of profit taking by one party (Hidayat et al. 2012).
Supply Chain Risk Analysis
Marimin and Magfiroh (2011) define supply chain risk as a loss that is assessed in terms
of the likelihood of occurrence, the possible causes, and the consequences in the supply chain
of a company and its environment. The critical point of PPSP supply chain performance and
risk lies in the characteristics of its products that are easily damaged by bacterial and
antibiotic contamination (Septiani and Djatna 2015). Supply chain risk analysis is conducted
to identify risks in the supply chain, measure their value and impact on supply chain
performance, and determine mitigation efforts that can be taken to avoid these risks.
Septiani and Arkeman (2013) stated that supply chain risk analysis is carried out in four
stages, namely the risk identification stage, the risk measurement and weighting stage, the risk
evaluation stage, and the risk handling stage. The risk identification stage is the stage of
recognizing disturbances that have the potential to damage the efficiency, profit level, and
percentage of success of an activity in the supply chain. The identification stage can be
carried out with various techniques including brainstorming, interviews, and surveys with
actors who play a role in the supply chain, as well as literature studies. The results of risk
identification are then classified according to predetermined categories.
According to Coyle et al. (2011) the risk categories that arise in supply chain
transportation are product loss, product damage, product contamination, delivery delay,
supply chain interruption, and security breach. Although the categories are intended to divide
the risks that arise during the transportation of dairy products, this can be applied to divide the
risks that can arise in the supply chain. Tummala (2011) in Septiani et al. (2014) divided
supply chain risks into ten main categories. These risk categories consist of demand risk,
waiting, damage, inventory, breakdown process, factory capacity, supply, system,
authority/power, and transportation. In addition to the two categories previously mentioned,
supply chain risks can also be categorized into supply and demand mismatch risks and risks
that occur in supply chain activities (Kleindorfer and Saad 2005; Septiani and Arkeman
2015). The category that will be used in this research is the category initiated by Coyle et al.
(2011).
The risk measurement and weighting stage is carried out by asking for expert opinion
where experts provide views on the probability and severity of the risks that have been
identified. The risk probability and severity values are given using a descriptive interpretation
of the fuzzy membership representation of the linguistic model, namely very low (0.0, 1.0,
2.0), low (1.0, 2.0, 3.0), 4.0), medium (3.0, 4.0, 6.0, 7.0), high (6.0, 7.0, 8.0, 9.0), and very
high (8.0, 9.0, 10.0).
Selection of Alternative Supply Chain Performance Improvement Strategies
Supply chain performance improvement strategy is a set of interrelated problem solving
from suppliers, manufacturing, storage, and sales so that products are made and distributed at
the right quantity and time, to the right address, with the aim of reducing overall costs and
meeting satisfactory service levels (Rana et al. 2015). The development of alternative
strategies to improve supply chain performance is based on the analysis of supply chain
management performance, added value, and supply chain risks. The key to success in
improving supply chain performance is to focus performance not only on parts that are below
predetermined performance targets but also on parts that are directly related to the overall
supply chain strategy (Kumari and Kumar 2015). Alternative strategies to improve supply
chain performance were then selected using the
Opportunities, Costs, Risks).
ANP is a mathematical method for structuring multiple criteria problems using
continuous mutual relationship control to get the best alternative recommendations (Gaikwad
et al. 2015). ANP is used to formulate a priority ranking technique process that produces a
priority ranking of alternatives based on predetermined system requirements (Aljuhani et al.
2017). The ANP method makes this possible because the ANP method considers not only the
mutual relationship of elements in a criteria cluster but also considers the mutual relationship
of elements in one criteria cluster with elements in other criteria clusters (Mohammadi et al.
2015). The BOCR approach itself is used to identify criteria attributes that must be possessed
by alternatives in an effort to achieve predetermined goals (Tchangani and Peres 2010).
Yazgan (2011) and Boran et al. (2008) mentioned that the stages in drawing conclusions
using ANP are as follows:
1. Building the ANP model
Wijnmalen (2007) mentions that the first stage of forming an ANP model is to form the
top level of ANP. This top level contains two clusters, where the first cluster contains
objectives and the second cluster contains four aspects of criteria, namely: benefits (B),
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opportunities (O), costs (C), and risks (R). The second cluster has sub-networks that each
have criteria, sub-criteria, and alternatives.
2. Form a pairwise comparison matrix
The pairwise comparison matrix is obtained from ratio scales in the form of pairwise
comparisons. Each ratio scale shows the comparison of importance between aspects in a
cluster and elements in the outer cluster. Ratio scales can also show the comparison of aspects
within a cluster. Not every aspect has an influence on aspects in other clusters. Aspects that
have no influence on other elements will give zero value in the matrix. The resulting matrix of
pairwise comparisons is called the supermatrix.
3. Formation of supermatrices and limit super matrices
4. Determination of the best alternative and synthesis of priority weights were carried out using
Super Decision software.
Design of Analysis Support Software
The analysis support software consists of System Database Management (SMBD) and
System Model Base Management (SMBM). SMBD allows users to access expert assessment
data and general company information while SMBM provides logical and mathematical
modeling to accelerate the process of measuring and improving performance. SMBD and
SMBM are then integrated into a calculation application supply chain performance.
Situational Supply Chain of KPS Gunung Gede Yoghurt
Gunung Gede KPS is located at Jalan P11 No. 5 Cimangkok Village, Sukalarang Sub-
district, Sukabumi District, West Java Province. The boundary to the north is adjacent to
Gebrong Sub-district and to the south is adjacent to Sukaraja Sub-district. Topographically,
Sukabumi Regency is generally undulating in the south and hilly in the north with an altitude
of ± 2960 meters above sea level. The topography around Gunung Gede KPS is ±700-900
meters above sea level with a temperature of 18-27°C and humidity of 70-80%.
KPS Gunung Gede, which was established on March 15, 1999 with legal basis No.
121/BH/KDK 10.6/III/1999, has four autonomous business units (UUO), namely UUO
production, UUO dairy cattle breeding, UUO savings and loans, and UUO processing. UUO
Production functions to provide marketing services for fresh milk, animal feed, dairy cattle
health, and dairy cattle insemination. The Dairy Breeding UUO functions to manage the
purchase and sale of dairy cows, develop the number of dairy cows in farmers, and conduct
quality control on dairy cows. UUO Savings and Loan functions to run the financial aspects
of the cooperative and ensure that the cooperative can continue to run and prosper its
members. UUO Product Processing functions to process the dairy milk obtained into
derivative products.
The yoghurt production process starts from testing the quality of dairy milk received
every day. Dairy milk obtained through the calculation of weight and volume, specific
gravity, alcohol test, color test, taste test, and texture test. Dairy milk that has been tested for
quality then enters the pasteurization stage to kill microbes contained in milk. Milk protein is
easily damaged when processed for too long at high temperatures, to prevent this from
happening, pasteurized milk is then cooled quickly in a cooling bath. Pasteurized milk then
enters the fermentation stage by being given a yoghurt starter and incubated for one night to
become yoghurt. The incubation process is carried out by wrapping the milk can containing
milk that has been given a starter with a sack and keeping it at room temperature for
approximately 16 hours. The finished yogurt is then given color and flavor before finally
being packaged and stored in the refrigerator.
Products
One of the milk-derived products that has become the flagship product of KPS Gunung
Gede is yogurt. Yoghurt is a fermented milk product. Yoghurt is consumed as a probiotic to
improve the digestive process, increase immunity, and so on KPS Gunung Gede's yoghurt
production line consists of 1150 ml yoghurt bottles, 250 ml yoghurt bottles, 1000 ml yoghurt
refills, and yoghurt ice. Every product produced by KPS Gunung Gede is guaranteed by the
halal certification of the Indonesian Ulema Council (MUI) number 01-121- 030-400-608 and
the quality assurance of the Indonesian Food and Drug Administration (BPOM RI) MD. 205-
228-002-286. Yoghurt quality standards based on BPOM RI can be seen in Table 6.
Market
KPS Gunung Gede products are marketed in the local market covering areas around
West Java such as Cianjur, Sukabumi, Bogor, Bekasi, and Bandung. The marketing concept
carried out is reseller distributors, working partners (agents), and direct sales at outlets.
Marketing conducted with agents is a consingency system, where agents usually sell around
Sukabumi with a focus on selling in schools and housing.
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Competition
The competition experienced by KPS Gunung Gede products is competition with
products that have previously dominated the market. This certainly requires KPS Gunung
Gede products to continue to develop towards a better direction, such as for example
marketing more intensively using advertisements in the media.
Basic Elements of Yoghurt Supply Chain
Supply Chain Structure:
The milk agro-industry system as the main raw material for making yoghurt products
includes several subsystems, namely dairy farming business activities, milk collection
cooperatives, and the Milk Processing Industry (Septiani and Djatna 2015). Dairy farming
activities generally play a role in producing fresh milk. Milk collection cooperatives play a
role in receiving fresh milk from farmers to be used as raw material for milk. The Milk
Processing Industry (IPS) plays a role in processing milk into derivative products.
The yoghurt agro-industry supply chain system that is the focus of this research has
farmer groups and KPS Gunung Gede as the main subsystems. The farmer group plays a role
in cultivating dairy cows and supplying dairy milk as raw material while KPS Gunung Gede
acts as a milk collection cooperative and IPS. This is because KPS Gunung Gede conducts its
own processing of dairy milk into derivative products, namely yogurt.
Yoghurt Agro-Industry Supply Chain Business Processes
Gelinas et al. (2004) state that business processes are a combination of activities that
require and process inputs and then produce outputs that have value for consumers. Supply
Chain Council (2012) divides supply chain business processes into five main processes,
namely planning, procurement, processing, delivery, and return.
The planning process is an activity that balances demand with supply. This is done so
that the process meets the desired level of supply, production needs, and delivery needs. The
procurement process is the process of obtaining the goods and services needed to carry out the
processing process. The processing process is the process of converting the supply of raw
materials in the form of dairy milk into the final product in the form of yogurt. The delivery
process is a process that allows goods and services that have been processed to reach
consumers.
Supply Chain Structure Management
The management structure used in the yoghurt agro-industry supply chain between KPS
Gunung Gede and the farmer group does not occur formally. There is no contract agreement
between the two actors. This is because farmer groups have full power to manage their dairy
cattle resources. KPS Gunung Gede and farmer groups also do not have a formal contract.
Farmers' deposits to KPS are purchased at a mutually agreed price by considering the lowest
market price of dairy milk and government regulations.
The payment system for dairy milk from KPS to farmers is not done every time milk is
deposited. Milk deposits made twice a day by farmers are recapitulated for two weeks. After
two weeks, the new KPS finance department pays some money to the farmers. This is done to
facilitate the transaction process.
Supply Chain Management Performance of Gunung Gede PPP Weighting
Matrix of Yoghurt Agroindustry Supply Chain Performance
Figure 10. shows the results of weighting the performance measurement matrix of
yoghurt agro-industry by organizing five experts. The weighting results show that the
consistency of the expert rater is 0.08 which indicates <0.05.
0.1. The aforementioned consistency indicates that the expert's judgment is unvarying and
trustworthy.
The weighting results show that the priorities for improving supply chain management
performance at each level are procurement with a value of 0.493, quality with a value of
0.661, reliability with a value of 0.602, and fulfilled orders with a value of 0.202. These four
aspects are then used as the main consideration in the preparation of strategies to improve
supply chain performance at the next stage.
Yoghurt Agroindustry Supply Chain Performance Measurement Results
The results of measuring the performance of the yoghurt agro-industry supply chain in
2016 were obtained from the actual values of the nine supply chain performance matrices in
2016 on the part of the farmer group with KPS Gunung Gede. The actual value obtained is
then compared with the target value that has been set.
The results of measuring the performance of the yoghurt agro-industry supply chain in
2016 showed that the percentage of farmer performance was 59.51% which fell into the poor
category and KPS Gunung Gede was 83.69% which fell into the moderate category. Poor
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farmer performance is caused by farmers not being able to increase demand for dairy milk
from KPS Gunung Gede and not being able to adjust dairy milk production to changes in
demand. KPS Gunung Gede's performance in the moderate category can be improved by
improving product quality and or increasing productivity.
Value-Added Analysis of Yoghurt Agro-Industry Farmer Group Value-Added:
Value-added analysis in the farmer group section relates to the amount of milk produced
from dairy cows owned, feed and nutrients used for livestock cultivation, and other
operational costs required. The results of the calculation of the added value of the farmer
group show that the percentage of added value obtained is 74.39% with a profit level of
71.12%. The percentage of added value that is already quite high can be caused because the
farmer group does not use a lot of costs for processing. Farmers do most of the processing,
namely milking manually.
Gunung Gede PPP Value Added
The value-added analysis at KPS Gunung Gede is related to the amount of milk
processed into yogurt, other materials used to process materials into products, and other
operational costs required, and transportation and distribution costs. The calculation of the
added value of KPS Gunung Gede for the 2016 period can be seen in Table 10. The results of
the calculation of the added value of KPS Gunung Gede show that the percentage of added
value obtained is 39.27% with a profit level of 38.25%.
Yoghurt Agroindustry Supply Chain Risk Analysis Identification of Yoghurt
Agroindustry Supply Chain Risks
As mentioned earlier, the critical point of performance and risk of the agro-industrial
supply chain of milk and its derivative products such as yoghurt lies in the perishable
characteristics of the product. Perishability of dairy milk to yoghurt can occur at any point of
the supply chain activities from upstream to downstream.
Measurement, Weighting, and Evaluation of Yoghurt Agroindustry Supply Chain Risks
The measurement and weighting of yoghurt agro-industry supply chain risks can be
divided into three parts, namely the farmers, KPS Gunung Gede, and distributors. As
mentioned earlier, the measurement and weighting of supply chain risks are carried out using
descriptive interpretation of the Fuzzy Membership Representation of Linguistic Model.
Risk management strategies are efforts to handle risks based on the results of risk
identification, measurement and weighting. Risk management efforts are obtained from the
results of literature studies and expert opinions.
Selection of Performance Improvement Strategy
KPS Gunung Gede has a supply chain management performance that falls into the
medium category with an added value of 39.27% and a level of risk impact that causes
disruption to the supply chain but has not caused losses. While farmers have supply chain
management performance that falls into the poor category with an added value of 74.39% and
the level of risk impact that causes disruption to the supply chain to cause losses.
The low added value of Gunung Gede KPS is caused by the procurement and
processing of raw materials that require high costs. The raw material procurement process,
which is the process of purchasing dairy milk from farmers, is not carried out based on the
quality of dairy milk. Dairy milk valued per liter is purchased at the highest average price.
This causes losses on the part of KPS Gunung Gede because if the yogurt products produced
do not meet the desired standards, the purchase rate will decrease. A decrease in the level of
purchases will lead to a decrease in sales revenue which will then have an impact on
decreasing the amount of residual operating results that farmers can borrow to capitalize their
business processes.
Based on the things mentioned above, the results of drawing expert opinions on the
priority of supply chain performance improvement which can be seen in the determination of
supply chain performance priorities in Figure 10, literature studies, alternative strategies for
improving supply chain performance are directed towards improving the raw material
procurement process and the process of monitoring and guaranteeing product quality
throughout the processing process. The strategy alternatives selected are as follows:
1. Improved quality control when farmers deposit dairy milk
Standard Operational Procedure (SOP) and a check list of desired quality standards are
needed when supervising the quality of dairy milk deposited. This is necessary to anticipate
farmers who cheat by adding other ingredients to the deposited dairy milk. This is necessary
because the quality control process of KPS Gunung Gede is carried out without standardized
procedures. There are no clear limits to the desired quality of dairy milk. SOPs and checklists
make it easier for the company to guarantee the quality of raw materials for making yogurt.
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2. Implementation of good house keeping and implementing hygienic standard operational
procedures during the production process
Good house keeping is a production efficiency where the production process eliminates
process efficiencies. Process efficiencies caused by work risks and undesirable conditions.
Good house keeping is expected to improve the process so as to produce better products.
3. Improved quality control at critical points of the processing process at KPS Gunung
Gede
Similar to improving quality control at the point of obtaining raw materials, improving
quality control at the point of It is also necessary to critique the processing process at KPS
Gunung Gede. This is because the quality of yogurt products produced by KPS Gunung Gede
varies. The production process that is still manual and quality control that is only carried out
casually (not following existing quality standards) needs to be improved to get products with
uniform, constant quality, according to established standards, and according to consumer
tastes.
The strategy alternatives are then organized into an ANP structure. The ANP structure
itself is designed with the main indicators of benefit, opportunity, cost, and risk. These
indicators are then broken down into criteria and sub-criteria that are considered influential in
making decisions on determining strategies to improve supply chain performance. Figure 11
is a structure for selecting alternative strategies to improve supply chain management
performance.
Figure 11 shows that the selection of alternative strategies for improving supply chain
performance is based on benefits, opportunities, costs, and risks as the main criteria. Each of
the main criteria has criteria clusters which are divided into economic, technological,
environmental, and social. Sub criteria are elements of criteria that are taken into
consideration to determine alternative performance improvement strategies. A clearer ANP
network can be seen in Figure 12 to Figure 15.
Figure 12 is the ANP structure of the main benefit criteria which is divided into clusters
of economic, technological, environmental, and social main criteria. The economic cluster
consists of sub-criteria elements of increasing profits (PK), increasing productivity (PM),
increasing product selling prices (PHJK), and decreasing production costs (PBP). The
technology cluster consists of improving production technology (PTP). The environmental
cluster consists of reducing waste from failed products (PLPG). The social cluster consists of
strengthening relationships with consumers (MHK) and strengthening product brands in the
market (MBP).
Figure 13 is the ANP structure of the main opportunity criteria which is divided into
clusters of economic, technological, environmental, and social main criteria. The economic
cluster consists of sub-criteria elements of increasing opportunities to open markets (MKMP)
and increasing opportunities to cooperate with the government (MKBSP). The technology
cluster consists of developing environmentally friendly technological innovations (MITRL).
The environmental cluster consists of decreasing negative impact on the environment (DLM).
The social cluster consists of being able to carry out corporate social responsibility (CSR)
and improve the company's image (MCP).
Figure 14 is the ANP structure of the main criteria of cost which is divided into clusters
of economic, technological, environmental, and social main criteria. The economic cluster
consists of sub-criteria elements of the cost of increasing production capacity (BPKP), the
cost of distribution to new locations (BD), and the cost of improving the quality of human
resources (HR). The technology cluster consists of implementation costs (BP) and
socialization costs (BS). The environment cluster consists of the cost of waste assessment
(WAS) and the cost of socialization (BS).
Selection of Performance Improvement Strategies by Experts
The data used for the selection of alternative strategies to improve the performance of
the yoghurt agro-industry supply chain can be obtained from filling out questionnaires by
experts. The questionnaire in question is a pairwise comparison of the elements contained in
the ANP structure in Figure 11. The display of the ANP network in Super Decision software
can be seen in Appendix 3 to Appendix 5 weight of each element. The results of pairwise
weighting of criteria and sub criteria can be seen in Table 20.
Research Limitations:
The limitations of the research are in the types of experts consulted. Experts who are
sources of information should come from academia, bureaucracy and practitioners. This
research only sought the opinions of experts from academia and practitioners. Experts from
the bureaucratic environment, for example from the Ministry of Agriculture in the field of
animal husbandry and the Ministry of Industry.
The supply chain management performance measurement and value-added calculation
also have limitations in that they do not cover distributor supply chain actors. This is because
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distributors do not keep clear bookkeeping of their transactions and capital on a daily basis,
making value-added difficult to calculate.
Managerial Implications:
Managerial implications are the involvement of supply chain components that are
influential in increasing productivity. The components in question are the analyzed aspects
that determine and improve the performance of the yoghurt agro-industry supply chain. These
components are supply chain management performance, added value, and supply chain risk.
Measurement of supply chain management performance is carried out to determine the
priority of each component of supply chain performance that needs to be improved and to
determine which supply chain actors whose performance levels are below the standard so that
steps can be taken to improve and improve their performance. Value-added measurement is
carried out to measure the added value obtained and measure the difference in added value
between each supply chain actor so that if the difference in added value obtained is too high,
improvement efforts can be made. The identification and measurement of risks that have the
potential to disrupt supply chain performance provide information on prevention efforts. The
results of all measurements are then used to provide alternative improvements
CONCLUSIONS :
The yoghurt agro-industry supply chain mechanism starts from the process of dairy
cattle cultivation by farmers, the production process by KPS Gunung Gede, to the distribution
of yoghurt products to consumers by distributors. The performance of farmers is in the poor
category and the performance of KPS Gunung Gede is in the moderate category. There is a
gap in the distribution of added value on the part of farmers and KPS Gunung Gede where
farmers get a higher percentage than KPS Gunung Gede despite their lower performance.
Supply chain risks with high impact on the supply chain are in the raw material procurement
and processing business processes. The alternative strategy chosen to improve supply chain
performance is the application of good house keeping and implementing hygienic standard
operational procedures during the production process in the breeder section and the
production section at KPS Gunung Gede.
