Improving Material Code Process Using Lean Service in Oil and Gas Company (Case Study: PT. XYZ)

Abstract

This study addresses inefficiencies in the Material Identification Code (MIC) request process at PT XYZ, an upstream oil and gas company, where delays in material procurement hinder operational performance. Using a Lean Service approach, the research identifies and eliminates non-value-added activities through Service Value Stream Mapping (SVSM) and Root Cause Analysis (RCA). The current process was mapped, revealing significant bottlenecks, including redundant approval steps, manual data verification, and fragmented communication, which extended lead times to 7.68–20.44 days despite an actual process time of only 0.52 days. The analysis classified process activities into Value-Added (VA), Non-Value-Added (NVA), and Necessary Non-Value-Added (NNVA), showing that 89.47% of the total process time was consumed by NVA and NNVA activities. Key wastes included delays in verification (7.27 days) and manual rework (3.03 days). To address these issues, a Future State Map was developed, incorporating digital automation, integrated communication tools, and streamlined workflows. The proposed improvements reduced process time by 46% (to 0.27 days) and cut lead time by 94.81% (to 0.60–1.06 days), while increasing the Value-Added Ratio (VAR) from 1.7% to 12.85%. This research demonstrates how Lean Service methodologies, combined with digital transformation, can optimize administrative processes in the oil and gas sector. The findings offer practical solutions for PT XYZ and serve as a model for similar industries seeking to enhance efficiency, reduce waste, and improve compliance with service-level agreements.