Proposed Business Process Improvement Using Lean Warehouse Approach At National Distribution Center Of PT XYZ

Putri, Sarah, Anandhita (2025) Proposed Business Process Improvement Using Lean Warehouse Approach At National Distribution Center Of PT XYZ. S1 thesis, Universitas Andalas.

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Abstract

PT XYZ is a Fast-Moving Consumer Goods (FMCG) company specializing in cosmetics, perfumes, personal care, and skincare products. The company operates 40 Distribution Centers (DCs) to distribute its products to stores and retailers across Indonesia. Additionally, PT XYZ manages two National Distribution Center (NDC) responsible for dispatching goods to all regions of Indonesia.Warehouse operations play a crucial role in ensuring the seamless distribution of goods to the DCs. However, inefficiencies such as excessive transportation, overproduction, extra processing, waiting, and defects have been identified in the operational activities of PT XYZ's National Distribution Centers (NDCs). These inefficiencies significantly impact warehouse performance, with one of the most prominent consequences being the failure to achieve productivity targets across various warehouse functions. This research aims to minimize these inefficiencies by applying the Lean Warehouse approach. Using tools such as Value Stream Mapping (VSM), Process Activity Mapping (PAM), Gemba Shikumi, 5 Whys, and the Fishbone Diagram, the study identifies four critical wastes within warehouse operations. The analysis revealed four critical wastes, with the highest Absolute Importance Value (AIV) found in storing activities due to excess inventory placed in aisles. Other significant wastes were identified in the checking, picking, and packing functions. Root causes included limited storage capacity, system-human resource misalignment, and redundant quality control. To address these issues, this study proposes the use of pallet racking and an RFID-based system. The proposed improvements are estimated to reduce total processing time by approximately 47.4%, from 9,419 seconds to 4,955 seconds. Additionally, Value-Added (VA) activities increased to 89.2%, and Non-Value-Added (NVA) activities were eliminated. These findings demonstrate that Lean Warehouse implementation can significantly enhance process efficiency, reduce waste, and support better service performance.

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