PROCUREMENT PROFESSIONALIZATION MASTER PLAN. Materi... · Adoption of basic and ... •This...

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PROCUREMENT

PROFESSIONALIZATION

MASTER PLAN

Prepared by:

R.Djokopranoto

For Symposium on 23 October 2012

MASTER PLAN

1.The Vision

2.Management Maturity level

3.Five Maturity Levels

4.Nine Key Process Areas

5.Define Characteristics

of each KPA and Key Features

6.Mapping outMaturity Level

7.Road Mapping

8.Pilot projecting:ITB ULP

ApproachAnalysis,

Mapping andRoadmap

Action Plan

9. LKPPPositioning

10. Mastering theMaster Plan

11. StrategicAction Plan

MASTER PLAN

1.The Vision

7.Road Mapping

APPROACHAnalysis.

Mapping andRoadmap

Action Plan

9. LKPPPositioning

1.The Vision

7.Road Mapping

Approach ANALYSIS, MAPPING &ROADMAP

Action Plan

9. LKPPPositioning

MASTER PLAN

Will be presented by Mr. Sonny Sumarsono

MASTER PLAN

1.The Vision

7.Road Mapping

ApproachAnalysis.

Mapping andRoadmap

ACTION PLAN

9. LKPPPositioning

Will be presented by Mr. Bambang

Adi Subagiyo

THE MASTER PLAN

APPROACH

1. THE VISION (1)

The Vision Statement of Procurement Professionalization:

• To regard procurement as a professional field where all procurement officers or staffs, public or private, are suitably qualified and expert for the job they conduct, through training and experience, where they adhere to a professional code of ethics and code of conducts.

1. THE VISION (2)

What are the Key Activities that should be done to reach the ‘The Vision’ ?Derived and inspired from the best practice in Indonesia (oil companies), the following 9 key activities (Key Process Area) are vitally required. THE 9 KEY PROCESS AREA

1. Training2. Human Development3. Career Development4. Professional Certification5. The Development of Code of Ethics and Code of

Conducts6. Governance Standardization7. Partnership with Professional Association8. Partnership with Training Providers9. Knowledge Management Development

2. MANAGEMENT MATURITY LEVEL

• To measure the performance of the Key Process Areas, a management framework model is required.

• The Framework model: developed from Carnegie Mellon’s Concept of Capability Maturity Model Integration (CMMI)

• It becomes the Procurement Professionalization Maturity Model (P2M2)

3. Five Maturity Levels

Level 1Ad Hoc

No formal and consistent process to execute a task/project

Adoption of basic and consistent approach to task/project execution

Consistent and comprehensive approach task/project execution

Task/project portfolio management is integrated and institutionalized

Level 2Planned

Level 3Managed

Level 4Integrated

Level 5Sustained

Established andStandardizedApproach to continuous improvement

THE BENEFITS OF PROCUREMENT

PROFESSIONALIZATION MATURITY

MODEL (P2M2)

• Indicates the key activities that have to be carried out;• Determines the maturity of the organization

management process;• Map out a logical path to improve the organization

performance;• Sets priorities for short-term process improvement

actions;• Tracks progress against management plan;• Provides general direction for long-term process

improvement plan;• Indicates best practice;• Builds culture of management process;

5. DEFINE CHARACTERISTICS OF

EACH KPA (1)

• By defining characteristics of each Key Features of every KPA

• For Example: KPA Training consists of 6 Key Features i.e.

• Training Activity

• Training Process

• Training Scope

• Training Infrastructure

• Training Database

• Training of Capacity Building12

5. DEFINE CHARACTERISTICS OF

EACH KPA (2)

Level 1Ad Hoc

Level 2Planned

Level 3Managed

Level 4Managed

Level 5Sustained

Training, if any, is conducted at non formal and inconsistent basis

* A basic and consistent training process is conducted* A Training Department is not established yet

* Training activities are conducted based on consistent and comprehensive approach* Trainingdepartment is established*Publish procurement magazine

* All types ofTraining within organization are programmed, integrated, and institutionalized* Run procurement book review at least once a year* Doing procurement research

* All training activities are already established and standardized* Focus in on continuous review and improvement

Example: TRAINING Activity

Matrix of Maturity Level ofTHE HUMAN RESOURCE DEVELOPMENT OF PROCUREMENT

PROFESSIONALSKey

Process Area

Level 1Ad Hoc

Level 2Planned

Level 3Managed

Level 4Integrated

Level 5Sustained

1.Training

2. HumanDevelopment

3. CareerDevelopment

4. ProfessionalCertification

5. Training Partnership

6.Establishmentof Code of

Ethics and Codeof Conducts

7. Professional Association Partnership

8.GovernanceStandard

9. Knowledge Management Development

V.C1 – I1

VI.C1 – H1

VIII.G1 – K1

V.C2 – I2 V.C3 – I3 V.C4 – I4 V.C5 – I5

VI.C2 – H2

VIII.G2 – K2

VI.C3 – H3 VI.C4 – H4 VI.C5 – H5

VIII.G3 – K3 VIII.G4 – K4 VIII.G5 – K5

CMMI Approach

Best Practice In Oil

companiesIn Indonesia

THE RELATIONSHIP

BETWEEN MASTER PLAN

AND PREVIOUS HRD PLAN

RELATIONSHIP OF THIS MASTER

PLAN WITH THE PREVIOUS HRD

PLAN BY ISP3 TEAM (1)

• In 2010, a HRD Plan was recommended by the ISP3 team. • This Procurement Professionalization Master Plan does not

in any mean replace, revise, nor correct the very well prepared ISP3 HRD Plan.

• While the ISP3 HRD Plan records the ideal job descriptions, the important issues and challenges, analyzing the key functions and responsibilities, and strategic initiatives to be undertaken by the respective directorates involved in professionalizing the field, this Master Plan focusing in positioning the organization in the capability maturity level map, showing the short term and long term roadmap, and indicating the best practice in every key factor area of procurement professionalization by the using of Management Maturity Level Model.

RELATIONSHIP OF THIS MASTER

PLAN WITH THE PREVIOUS HRD

PLAN BY ISP3 TEAM (2)

• Furthermore, while the ISP3 HRD Plan is mainly prepared for the three directorates of LKPP, the Procurement Professionalization Master Plan is mainly prepared for the M/A/R/I or K/L/D/I.

• In short the Procurement Professionalization Master Plan is the continuation of ISP3 HRD Plan, which can be used as LKPP standard guidance for the M/A/R/I to enhance the procurement professionalization.

The Difference Between hrd plan and

masterplan

• 3 Directorates Function Based Approach

• Analyzing and elaborating 11 Key Functions and Responsibilities of 3 Directores

• Suggesting Action Plan for each Directorate

* Applicable for LKPP only

• Management Maturity Model Approach

• Analyzing 9 Key Process Area for Professionalization

• Providing Management Tools for measuring capability and showing roadmap for I improvement

• Suggesting Action Plan in using the Tools

• Applicable for LKPP and K/L/D/I

HRD PLAN (Australia Indonesia

Partnership)

MASTER PLAN (Asian Development Bank

D/S/B)

Title: HRD STRATEGY FOR THE HUMAN RESOURCES DEVELOPMENT

Title: PROCUREMENT PROFESSIONALIZATION MASTER PLAN

THE SHARING

EXPERIENCE

WHY IS PROCUREMENT IN OIL

COMPANIES CONSIDERED AS BEST

PRACTICE?

• Procurement professionalization has been their tradition and practice since 1950.

• Logistics Department (procurement, inventory control, warehousing, distribution) has been established since the beginning.

• Logistics jobs are full time jobs;• Since the beginning, logistics job is considered as

professional job.• Recruiting logistics staffs were done through a long

pre-employment training program (2 years)• Human development, career path advancement, job

establishment have been fully established, etc.20

The Formation of Pertamina

PNPERTAMINA

Stanvac

ShellCaltex

PNPertamin PN

Permina

PNPermigan

Tahun 1970-1975 dipimpin perwira

ABRIBPM, Shell and ABRI

serious and long tradition of logistics

training is inherited to PERTAMINA

1965-1975Permina/PERTAMI

NA managed by ABRI

Procurement Pre-Employment

Training – Perusahaan Migas

BPM/Shell

PERTAMINA

1950-1961PETROLEUM COLLEGE (2 years)• Study program ‘Materials Administration’ (Procurement,

Inventory Control, Warehousing, Distribution)Only after graduation, a student was officially accepted as Shell employee in Materials Department

1970-2000In House Training• CPT (Crash Program Training) Logistik, S1 + 9 months;• BPSL (Bimbingan Profesi Sarjana Logistik), S1+12 months;• BPAL (Bimbingan Praktis Ahli Logistik), D3 Poli + 24 months,

Dirjen Migas• Akamigas (Akademi Minyak dan Gas Bumi) SMA+24

months;Only after graduation, a student was accepted as employee;

Procurement Pre-Employment

Training – Perusahaan Migas

Total Indonesie

2001-2004LST (Logistics Supervisory Training), D3 + 24 months;Conducted in English (textbook and tutorial)

WHY DOES PRE-EMPLOYMENT

TRAINING TAKE SO LONG (1)?

• To prepare and equip them with the knowledge and skills to do purchasing/procurement with the following principles:

• Buy at the right price• Buy at the right source• Buy at the right quality• Buy at the right quantity• Buy at the right time

• To prepare and equip them with the knowledge and skill to synchronize the purchasing/procurement with the inventory control

Why does the pre-employment

training take so long (2)?

Curricula Competency Method• Logistics knowledge (50%) * Mastering the

• Procurement knowledge and skill

• Inventory control of procurement, invent.

• Warehousing control & warehousing

• Industrial knowledge (15%) * Understanding the

• Oil and gas industry oil exploration, drilling,

operation production & refinery

• Materials knowledge (30%) * Mastering the name,

• All the materials that are description, standard,

procured, stored and and usages of materials

controlled and equipment

• Procedures and Regulation (5%) * Mastering in logistics

procedures & regulations

70% classroom

30% field experience (practical)

Field Experience (Practical)

during Pre-employment training

Logistics*Procurement office*Inventory control office*Warehousing

Oil Industry*Oil well Drilling*Production site*Refinery *Mechanical workshop*Electrical workshop*Instrumentation workshop*Fire and safety operation

Example of Industrial Knowledge

Procurement Professionalshould know:

* How does the oil drilling rig work?* What is the sequence of drilling?

* What is the jobs of its crews?* What is the function of every parts?

* What is happening underneath?* How decide the correct location of drilling?

The Logistics student spends one week works together with the shift crews to fully

understand the real operations of the drilling rigs.

Example of Materials Knowledge

Procurement Professionalshould know the name and the function of all

parts/equipment of the drilling rigs1. Crown block2. Drilling mast3. Drilling cable

4. Travelling block5. Rotary table

6. Derrick substructure7. Mud pump

8. Drilling upper platform9. Hook

10. Drilling platform12. Blow out preventer, etc.

and all materials used during drilling: casing, tubing, oil well cement, drilling chemicals, etc.

Exam for Procurement Professional

Question:What is the name and

the complete description of this material ?

Exam for Procurement Professional

Answer:

Gate Valve,Carbon steel, class 300,

ASA flanged end,Raised face,

Bolted bonnet, Inside screwed wheel,

Diameter 4”30

Why Should a Procurement

Professionals know about the

materials they procure?

• To understand the degree of importance of materials to be procured to the operation;

• To facilitate the negotiation;

• To understand the market of the materials to be procured (monopoly, oligopoly, pure competition)

• To review the quality and quantity of materials to be procured, if required;

• Etc.

Pertamina Procurement Training and

Human Development (1)

• PLPM (Penataran Logistik Penyegaran Manajemen), for senior staff, 6 weeks, to maintain knowledge

• PLPGM (Penataran Logistik Pemantapan Gol Madya), for junior staff, 4 weeks, to maintain knowledge

• Kader Logistik A, S1 + 12 months (employee with S1 diploma who has no logistics training)

• Kader Logistik B, D3 + 18 months (employee with D3 diploma with has no logistics training)

Pertamina Procurement Training and

Human Development (2)

• On the job training in Procurement Department, British Petroleum, UK (3 months)

• Logistics Management Program at various universities/institutes such as London Business School, Princeton University, Northwestern University, World Bank, etc..

• MBA majoring in Logistics US universities;

• Tour of Duty within Pertamina organization;

• Tour of Area within Pertamina offices;

• Etc.33

Pertamina Career Path for

procurement professional

(Job/Salary Group Based)

PEMBINA 4 Executive321

Gol.UTAMA 1 Senior Manager23

Gol. MADYA 4 Junior Manager567 Supervisor8 9

Gol. Non Staf 10 Non staffs/d16

Procurement ProfessionalCareer Path

Pertamina Career Path for Procurement

Professional (department based)

LogisticHead Office

LogisticForeign Office

LogisticUnit Office (7)

LogisticField Office (14)

Logistic employee* Total 1700* Staff 270* Certified :

staff : 80%manager : 100%

Pertamina Career Path for

Procurement Professional

(Function Based)

Warehousing &Distribution

Inventory Control

Procurement

Pertamina Logistics Certification

• Professional Certification in Indonesia at those days was not established yet;

• Professional recognition was expressed in certificates of the long terms professional training as already mentioned:

• Petroleum College: ‘Materials Administration’;

• BPSL: Bimbingan Profesi Sarjana Logistik;

• Akademi Minyak dan Gas Bumi, majoring in Logistics;

• BPAL: Bimbingan Praktis Ahli Logistik

• Etc.37

Pertamina Training Partnership

• 80% of the training dan human development in Pertamina were conducted in house;

• Some Training Partners:

• Universitas Indonesia (trainers for related knowledge to logistics)

• ITB (ditto)

• British Petroleum, UK (on the job training)

• Akamigas, Cepu

• Lemhanas (for executives)

THANK YOU

LKPP39

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