Supply chain performance measurement and improvement of palm oil agroindustry: A case study at Riau and Jambi Province

Abstract

Supply chain performance measurement and improvement is required to control the performance and define a strategy to improve agroindustry’s competitiveness. The objectives of the research were to identify supply chain configuration and mechanism, and to analyze the supply chain performance and define the supply chain performance improvement for palm oil agroindustry. The research was conducted at Riau Province and Jambi Province as the central palm oil production in Indonesia. The Supply Chain Operation Reference (SCOR) and Analytical Hierarchy Process (AHP) were applied to analyze the supply chain performance and the performance improvement strategies were formulated descriptively with expert discussion. The results showed that the average performance of farmers, traders and refinery at Riau Province were 77.77%, 74.60% and 79.20%. The average performance of farmers, traders and refinery at Riau Province were 72.66%, 75.39% and 83.11%. This research had succeeded to define the strategies to improve palm oil supply chains at Riau Province and Jambi Province. The strategies were focused on good agricultural and good handling practice, specifying the palm oil prices refractions based on quality and implementing the information system to improve the supply chain performance.