Evaluating the effectiveness of the transport system in Indonesia

Evaluation of urban public transport system in Indonesia, the possibility of its effective development. Analysis of influence factors by using the Ishikawa Cause and Effect diagram and also the use of Pareto analysis. Using business process reengineering.

Рубрика Менеджмент и трудовые отношения
Вид контрольная работа
Язык английский
Дата добавления 21.04.2014
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transport indonesia reengineering

In a country like Indonesia, it is very essential that its transportation system be very efficient in order to permit economic development. What is required would be to have efficient planning in relation to its transportation system and efficient infrastructure to facilitate efficient transportation which would be capable of sustaining efficient economic growth. In this paper, there will be an analysis of facts within the case study in order to determine the problems being faced as well as to propose solutions and recommendations that could be implemented to enhance the nation's transportation system. The main issues that within the nation's urban public transportation system would be analyzed using the Ishikawa Cause and Effect diagram and also the use of Pareto analysis. The likely solutions to problems identified would be proposed using management tools like Total Quality Management and Business Process Reengineering.

1. Key Problems Identified from Case

In making an analysis of the given case, it is observed that a number of problems seem to be apparent and these include the presence of an increase in the population of Yogyakarta, and also an increasing private vehicle use and the unsatisfactory state of roads of Yogyakarta which are very congested. The public transportation system is providing bad quality of transportation services that are making people show an interest in using private vehicles. This is contributing to an increase in traffic congestion problems as the increase in the number of vehicles which has the outcome of reducing the capacity of roads in the area. In essence, the problems could be categorized as being management, people, and environment issues.

2. Problem Analysis

The analysis of problems would be carried out using the fishbone diagram in order to bring about the Cause and Effect relationships (Ishikawa, 1968). The sole causes of issues are identified and addressed to bring about the possible solution (Hankins, 2001). In essence, the fishbone diagram would be a strategic tool which can provide a very logical method of viewing problems and causes that would create or would contribute to problems (Ishikawa, 1976), (Copi, 1968), (Gregory, 1992). The Pareto Analysis would then be used to determine the primary causes.

2.1 Cause and effect diagram Analysis

This framework would be used to make an analysis of cause and effect relationships where there would be link with the facts of the case with the fishbone diagram (Ishikawa, 1990), (Dale, et al. 2007) and (Tague, 2004). The issues that are identified would come within the categories outlined below:

· Management Problem

· Machine/Service Problem

· Other Problems

· Policy Problems

Outlined below is a figure that exhibits the problems:

Figure 1: Cause and effect diagram

2.2 Pareto Analysis

This is a statistical tool which helps the process of decision making. In essence, Pareto analysis involves making a selection of a small amount of tasks which are likely to cause an overall effect and is utilized to organize various data that is being collected. The Pareto Principle is also known as the 20/80 rule, that is by carrying out 20% of work, it is so that 80% of the advantage of doing all of the work is capable of being generated. The main problems are bring about by a limited number of key causes, which comprises of 20% and which has the most significant effect on outcome. The management and controlling of these risks would be selected in order to solve 80% of the problem. This sort of technique is such that the causes of the problem would be competing with each other. In essence, this method is used to make an identification of a core category under which main principal causes would come within (Litten, 2013).

Outlined below is the Pareto analysis chart for the problems which are identified under various categories that include “Management”, “Machine/Service”, “Other”, and “Policy” in order to make an identification of the main causes.

Table 1: Causes and percentage and cumulative frequency

In making an analysis of the data contained in the above table, it is observed that root causes of problems within Yogyakarta's transportation system would stem from the management of the various transportations companies. This is then closely adhered to by machine/service category.

2.3 Analysis of Issues and Causes

In looking at the problems as identified by the Pareto analysis, it is apparent that management issues would be the primary causes of problems that are present in the urban public transportation in the city of Yogyakarta. What is apparent here is that various integrated transportation system problems are identified as the sort of problems that have a very significant role when it comes to contributing to a lack of high quality in the providing of public transport in Yogyakarta. The fact is that inefficient management practices and bad structure of the nations public transport system can be labeled as being the primary causes of the bad quality of the nations public transport service. There is no framework within companies functioning in this industry that permits upward communication and hence there is no way for feedback and suggestions of improvement to be channeled up to persons within the upper management. Also, the monopoly which is being exercised by cooperatives and also licensed route operators are significant causes of that hamper the progress of public transportation in Indonesia.

Outline below are main problems identified.

Table 2: Causes and categories

3. Proposals to Solve Problems Identified

In order to address the issues that are identified, it is apparent that business tools like Total Quality Management (TQM) and Business Process Reengineering (BPR) are utilized. These are very efficient methods that could be used to help address various operational management problems.

3.1 Total Quality Management Implementation

TQM is a very comprehensive philosophy that includes various processes which look to evaluate and enhance quality on a continuous basis (Anand et al, 2010). It also uses strategic data and communication in order to incorporate quality principles into organizational culture and activities (Ahire, 1997). It is the concept of customer satisfaction that TQM places emphasis on and the analysis here would relate to talk about how to enhance the quality of public transportation in Yogyakarta so as to reduce overall traffic congestion problems. What is required here is the adoption of TQM in order to facilitate continuous improvement of services that are offered to members of the public (Cua et al, 2001), (Chin et al, 2001) and Crosby, 1989). TQM is a management philosophy that can be described as being a very efficient management of initiatives and procedures which are focused at achieving the delivery of quality products and services (About.com - Principles of Total Quality Management, 2013). There are a number of key principles which are observed to be present when it comes to defining TQM and these are discussed below. Principle 1: Executive Management - This involves member's top management acting as the main driver for TQM and also striving to create a conducive environment that would ensure its success (About.com - Principles of Total Quality Management, 2013). Principle 2: Training - Employees are required to get regular training when it comes to methods and concepts of quality.

Principle 3: Customer Focus - The overall improvements in quality would have the outcome of improving customer satisfaction (About.com - Principles of Total Quality Management, 2013) Principle 4: Decision Making - it is noted here that quality decisions must be arrived at premised on well defined measurements (About.com - Principles of Total Quality Management, 2013)

Principle 5: Methodology and Tools - In relation to this, the use of appropriate methodology and tools would make sure that any sort of non-conformances can be identified, measured and responded to in a way that is efficient and highly consistently (About.com - Principles of Total Quality Management, 2013)

Principle 6: Continuous Improvement - It is also necessary that organization continuously work towards enhancing various manufacturing and quality procedures (About.com - Principles of Total Quality Management, 2013)

Principle 7: Company Culture - in terms of the culture of an organization, this must be focused on mostly developing the capabilities of employees to work together in order to improve quality (About.com - Principles of Total Quality Management, 2013)

Principle 8: Employee Involvement - This suggests that employees must be encouraged so as to become proactive when it comes to making an identification and addressing of various quality related problems (About.com - Principles of Total Quality Management, 2013)

The fact is that service quality of the city's transportation service framework must be enhanced in order to attract an increasing number of passengers. The fact is that cleanliness and high quality of various transportation vehicles like buses which are fitted with new air-conditioning facilities must be provided so as to attract road users to use public transportation as opposed to private vehicles. In essence, there must be an increase in the quality of transportation in order to acquire support from commuters so as to use public transportation methods and to also increase the overall reach, availability and frequency of such transportation. It is very essential that public transportation modes like buses meet capacity requirements (Lewis et al, 2006).

3.2 Business Process Re-engineering Implementation

BPR is a very essential redesign of a present business process so as to achieve very significant enhancements in terms of performance measures (Rummler et al, 2009). BRP would normally involve an analysis as well as redesigning of various workflows and processes and also comprises of various changes in relation to operational practices (Davenport, 1993). In essence, it could also involve changes within the internal processes so as to remove processes that are causing loss. The objective of BRP would to be change and renew how a business carries out its activities in order to achieve very efficient organizational performance. Improvements of service quality in the sphere of public transportation in Yogyakarta can be achieved through using BPR (Lon, 1994).

There are a number of benefits of using BPR in organizations like those in the public transportation industry. The first of these is increased effectiveness in the organization because employees know about the processes to which they belong and they also have a greater sense of responsibility. Every process if very stringently monitored under the control of the management. The outcome is that employees would be delivering high quality products and services to customers. The next benefit is that BPR helps to improve efficiency through very efficient management and control of every business process and this has the outcome of reducing the amount of time lag which is present between different processes and which might otherwise bring about delays (Benefitof.net - Benefits of Business Process Reengineering, 2013). This would then have the consequence of reducing the overall time to market a product or service to various target customers and provides a fast response to these consumers (Rummler et al, 2009).

Costs reductions are another benefit of BPR and when there is a very efficient management of processes, improved efficiency and fast delivery of products to the buyers would result in the product costs being reduced (Benefitof.net - Benefits of Business Process Reengineering, 2013) and this would then result in cost saving for an organization during the long term (Hussein, 2008)

BPR also produces very meaningful jobs for employees and as time lag of product and service processing between different departments in a firm starts to reduce because of using BPR methods, an increasing number of meaningful tasks can be performed by employees. This would then lead to an increase in the motivation of staff and also their overall desire to perform very well. BPR also has the capabilities of bringing improvements in the organizational approach and organizations that implement BPR have been observed to enjoy an increase in flexibility and adaptability for change (Benefitof.net - Benefits of Business Process Reengineering, 2013). This is noted to have the impact of creating a better environment for its staff to work in and hence generating a high level of employee satisfaction (Hussein, 2008).

In addition to all the above points, BPR also helps to grow an organization and this would then enable the emergence of new kinds of businesses inside the same organization. It has been said that BPR is a method that is very effective when it comes to controlling cost and also improving efficiency but its implementation is not something that is very easy (Benefitof.net - Benefits of Business Process Reengineering, 2013). Employees are known to be highly resistant to this sort of change and hence it is essential to have extensive support from members of the top management (Hussein, 2008).

The use of BPR in this instance would comprise of making a review of the various processes involved and which have a role in providing the end service (Champy, 1995). This sort of technique can be used to take away non functioning processes in the company and to allow for the adoption of new processes which are required to help improve the performance of an organization (Davenport et al, 1990). This might comprise of removing certain process in the organization or changing how things are done in the company using a new method or technique (White, 1996). In this instance, it is essential that BPR is implemented in order to continuously monitor the system to address any sort of resistance to change which might arise (Benefitof.net - Benefits of Business Process Reengineering, 2013). The BPR approach is capable of being used here to solve problems that are apparent within the processes, procedures, policies as well as methods that are adhered to by the Indonesian transportation industry (Rummler et al, 2009).

3.2.1 Implementation of Business Process Reengineering in the Yogyakarta Public Transportation System

In the section below, there would be a presentation of various BPR principles. These comprise of the following:

· Organizing around outcomes (Hussein, 2008)

· Linking parallel activities within the workflow as opposed to a mere integration of results (Hussein, 2008)

· Placing the decision point precisely where work is being carried out and to implement control within the process (Hussein, 2008)

· Integration of information processing work towards becoming real work which is capable of producing information (Hussein, 2008)

· Treating geographically dispersed resources in a way that suggested they are centralized (Hussein, 2008)

· Identification of organizational processes and to prioritize them in such a way that it shows urgency of redesign (Hussein, 2008)

· Gathering data at the source (Hussein, 2008)

The BPR method that is selected to be implemented in the Yogyakarta public transportation would be the consolidated methodology and this is discussed in detail below.

3.2.2 The Consolidated Methodology

The selected method is known to have the capability of providing a very well structured approach and also to facilitate understanding (Abrahamson, 1996). The fact is that Yogyakarta public transportation system required their information technology management system to be improved and become more modernized so as to enhance the overall service quality which is being offered (Malhotra, 1998). For instance, a new information system that facilitates ticketing is capable of being introduced so as to enhance the process of ticketing in order to make it more efficient and fast (Ponzi and Koenig, 2002). The use of information systems would also help in the management of change of the organizations business process and this is being done by communicating about change to everyone in the organization (Hussein, 2008) and (Thompson, 1969). Outlined below are steps that would be adopted so as to facilitate the process of implementing BPR. Making Preparations to Introduce Reengineering

In this instance, there must be a review done on restructuring work methods as well as taking into account environmental changes which serve to act as a motivation for restructuring (Loyd, 1994). There must then be a development of guidelines for project restructuring. After that, strategic objectives should be developed in order to make sure that restructuring efforts would repeat. There should then be a drafting of statement of the requirements of public transportation (Hussein, 2008). Mapping and Analysis Processes

This phase relates to the development process and the BRP program would involve a complete restructuring of the administration in the organization and to make an analysis of the organizational structure, a redefinition of the system and utilization of the most appropriate modern technology.

There is also an identification of various legal requirements that are placed on the system (Abrahamson, 1996).

There would then be an analysis of the requirements to use information technology in order to help in the development of service, to make an analysis of managerial requirements of service and to know the correct timetable of service delivery (Johansson, et al, 1993). There must be an analysis carried out on the requirements of the fleet of buses that must be enhanced and to make an analysis so as to review the wage structure of bus drivers (Leavitt, 1965).

Figure 2: Map and Analysis of the processes (Hussein, 2008) Design To-Be process

The aim in this phase is to devise alternatives that would help to achieve the strategic goals (Industry Week, 1994). Among the alternatives include the restructuring of the total structure of the organization, licensing routes to validly selected operators, making a redefinition of the regulations, implementing strict enforcements of laws, using information technology to make known various change initiatives and to enhance the service provided, improving the service management, making a precise and accurate scheduling of transportation related services, repairing damaged and inefficient fleets of vehicles, widening the range of services offered and making an audit of various essential process like the payment of wages to drivers (Hussein, 2008). Implementation of Reengineered Process

There would now be a discussion of the implementation of the reengineered process in the headings below. Organizational Redesign

There can be a number of enhancements which are brought about to the overall quality of Yogyakarta's bus transportation service and hence there is a requirement that improvements be made to it (Hansen, 1993). The first of these involves a thorough reorganizing of the Indonesian bus industry and this would involves a proper and equal redistribution of power among parties that are involved so as to generate healthy competition and this has the outcome of making prices of transportation services become more competitive and hence more affordable to consumers (Hussein, 2008). The presence of a monopoly of operators within the licensed routes as well as monopoly by cooperatives that act as intermediaries between ORGANDA and the Indonesian Government must be eliminated as they are acting to restrain positive change. It is essential that the government remove this monopoly and to help make the industry become more equal and non oppressive to consumers. There should be an implementation of a system that comprises of the government, various cooperatives, local operations and ORGANDA and there must be an equal balance of power among these parties and this would help to enhance the standards of public transport in the nation. It is essential that monopoly of various cooperatives and operational local owners be reduced significantly (Abrahamson, 1996). Regulation Change

The fact is that changes in the organization would also bring about changes in the present regulatory policies and practices within the industry (Hammer and Stanton, 1995). DISHUB is the sole regulatory agency and must be given considerable amount of power to enable it to effectively monitor and also regulate the Indonesian transportation system. There must be a framework implemented which requires that existing operators only be grated a license if they have satisfied certain criteria such as upgrading their vehicles etc. There must also be changes made to how drivers are compensated. Also regulations must be implemented to prevent unscrupulous monopolistic activity in the industry (Hussein, 2008). Infrastructure Planning

The elements of infrastructure planning should also be addressed here (Hammer and Champy, 1993). In essence, it would involve enhancements introduced to enhance the conditions of the present road network, to reduce the costs of transportation as well as to provide enhanced regional accessibility. It is also suggested that there be development of bike line along roads as well as enhanced facilities that cater for pedestrians and cyclists. In addition, there should also be an integrated network that is specifically meant to cater for pedestrians as well as various other non-motorized vehicles (Hussein, 2008). New Management

The use of BPR required there be enhancements carried out so as to improve the management practices by making it adopt a number of recommendations (Hammer, 1990) and these include increasing the level of competition of medium bus transportation service operators so as to make the service to be offered at lower costs and with higher quality, to make a review of regulations on public transportation operations as well as to make a review of regulations that are connected with financial mechanisms and tariff setting mechanisms relating to Yogyakarta's public transportation. Another recommendation is for improvements to be made to efficiency and quality of the industry's procurement process (Hussein, 2008). Licensing Process

When it comes to licensing, there must be efficient standards which are set to license bus drivers. It is essential that the licensing system be improved and licenses must be given by the government only when a bus satisfies the criteria set out by public transportation authorities (Hussein, 2008). The government must also provide a subsidy to help restoring the overall quality of buses. Also, it is very essential that bus drivers be in conformance to various rules and standards that are set in order to enhance the public transportation system's overall efficiency (Guha et al, 1993). Continuous Improvement of Processes

It is only via continuous improvements that a restructuring can be successful (Greenbaum, 1995). There is a requirement to monitor results and progress of action. In relation to progress of action, this is measured using the vision of long-term planning (Hussein, 2008). There must also be a continuous monitoring of results so as to encompass measures like customer perceptions, staff perception and also supplier responsiveness. There must also be a reviewing of the team's performance. Steps must also be taken in order to enhance the operations continuously using a performance sequence mechanism, utilization of problem solving skills etc (Dubois, 2002).

4. Suggestions

A number of suggestions can be made here in relation to enhancing the performance of the public transportation system in Yogyakarta. There are discussed below.

4.1 Lowering Costs of Public Transportation

It is essential that costs of using public transportation in Yogyakarta be reduced so as to attract customers. Where prices are high, it is unlikely that people would trade private transportation over public transportation. The ticket fare prices should be reduced especially when it comes to rush hours so as to attract commuters to use public transport. Prices can be reduced where there is a government subsidy on petrol and the lowering of fuel prices for public transportation would help to lower prices of bus fares.

4.2 Advancing the Importance of Using Public Transportation

The government must take proactive steps to motivate Indonesians to show a preference for public transportation over private transportation and the awareness of the benefits of using public transportation can be communicated to public via the use of electronic and print media. The information contained within these advertisements should communicate to public the benefits which they would enjoy if they use public transportation, such as the cost savings, reduction in environmental pollution and a reduction in traffic jams through less cars being on the road. These advertisements should also communicate the disadvantages of using private vehicles such as the pollution caused by vehicles that would damage the environment and which would then affect the lives of people living in the city.

4.3 Replacing the Manual Ticketing System

It is suggested that manual ticketing be removed from the public transportation industry and be replaced by automated ticketing. Instead of having customers queue up in counters where tickets are issued by an employee of the company, it is more efficient to have a ticket dispensing machine that can produce a ticket fast and efficiently. An automated ticketing system would be one that is user friendly, secure and highly interactive. The benefits which the use of a machine like this can provide to passengers is quite high and these includes offering passengers with very optimal transaction time, it offers consumers to pay for a ticket using a variety of methods like coins, bills, credit cards and smart cards. When it comes to operators, the benefits include reliability, resistance from vandalism, minimization of reloading operations, coin recycling with high capacity and convenience maintenance. Costs are also saved from not having to hire staff to sell tickets at counters like is it when doing manual ticketing.


In the analysis carried out here, what is observed is that Yogyakarta's public transportation system is very inefficient and a number of challenges are present within its framework that seems to hamper its progress. In addition, the lack of efficiency of the system makes Indonesians show a lack of preference for using public transportation and prefer using private transportation and this contributes to an increase in traffic congestion and environmental pollution. A very essential role is played by Indonesia's transportation system when it comes to enhancing overall economic development. The government of Indonesia has the responsibility to bring about positive reform in Yogyakarta's urban public transportation system. There is a requirement to enhance the present public transportation infrastructure in order to make it have the potential of attracting a larger number of commuters. The change from private to public transportation by these people would help to reduces the environmental damage and traffic congestions that is presently affecting Yogyakarta. In the research carried out here, there was a measurement and evaluation of problems facing the city's transport infrastructure. A number of management solutions were taken into account and after making an evaluation of these methods, the decision was made to use TQM and BPR in order to solve the problems identified within the case study. BPR was used to provide effective solutions to various causes of problems as identified using the cause and effect analysis. The main problems that were identified include management related problems that mostly stemmed from operations management. The use of a Pareto Analysis helped to resolve major issues. In essence, the use of BPR was the best solution to solve the problems of bad quality of Indonesia's public transportation system. There were also a number of recommendations made to help improve the efficiency of the country's public transportation system.


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