Author Archives: Adi Nugroho

W13_ET_Reduce Cement Consumption in Paste Fill_Kristal2011


Problem Statement:

In back fill activity we are using 14% of cement content in the paste pouring to the area in underground mine that have been finished in ore mining. In order to be able to mine an ore drive beside or underneath it, we need to back fill it first before we are allowed to do mining in relation to comply with geotechnical requirement and safety factor. The higher cement percentage being used in back fill activity, means that higher consumption in cement.

Alternatives:

Review had been done with geotechnical and mine planning team for certain drifts to use lower cement percentage in order to reduce operating cost. There are some conditions that after we back fill certain drifts, we are not going to mine under or beside for more than 3 months depending on the mine planning team.

Criterion:

Ground stability is a priority and still in mining practice. Higher cement percentage will create faster curing time to be able to mine under or beside as soon as possible to get the ore areas. But for some reasons depends on mine planning, in certain areas we don’t need to mine as soon as possible.

Analysis and Comparison:

The table below shows areas that used 14% of cement and we will mine under or beside them in some stages

                       

No.

Date

Location

%Cement

Material Usage

Paste Product

 

Vs Dry Tuff

Cement

Water

Tuff

Tuff dry

Tuff

 

  

Tons

Tons

Tons

Tons

M3

Tons

M3

 

1

5-Jul-11

K2-Sub 9’D’ Sill South OD.03

14%

83

286

774

578

846

1143

706

 

2

8-Jul-11

K2-Sub 12’B’ Sill South OD.03

14%

18

70

172

128

188

260

161

 

3

9-Jul-11

K2-Sub 12’B’ Sill South OD.03

14%

19

68

180

134

197

268

165

 

4

9-Jul-11

K2-Sub 9’D’ Sill South OD.01

14%

48

171

443

331

484

662

408

 

5

24-Jul-11

K2 – Sub 11 ‘A’ UC.1 North OD.05

14%

69

237

639

477

699

945

584

 

6

24-Jul-11

K2 – Sub 11 ‘A’ UC.1 North OD.05

14%

16

52

148

110

162

216

133

 

7

26-Jul-11

K2 – Sub 11 ‘A’ UC.1 North OD.05

14%

2

9

22

16

24

33

20

 

8

27-Jul-11

K2 – Sub 11 ‘A’ UC.1 North OD.05

14%

8

28

71

53

77

106

65

 

9

10-Sep-11

K2 – Sub 9 ‘D’ Sill South OD.1

14%

75

262

692

517

757

1029

635

 

10

28-Sep-11

K2 – Sub 12 ‘B’ Sill South OD.01 (#1)

14%

124

408

1151

859

1258

1683

1039

 

11

30-Sep-11

K2 – Sub 12 ‘B’ Sill North OD.02

14%

55

199

515

384

563

770

475

 

12

7-Oct-11

K1 – Sub 6 ‘A’ UC3 North OD.01

14%

134

453

1249

932

1365

1837

1134

 

13

8-Oct-11

K1 – Sub 6 ‘A’ UC.3 North OD.01

14%

24

89

225

168

246

338

209

 

14

8-Oct-11

K1 – Sub 6 ‘C’ UC.3 North OD.02

14%

65

232

603

450

659

899

555

 

15

8-Oct-11

K1 – Sub 6 ‘C’ UC.3 North OD.02

14%

55

183

508

379

555

746

461

 

 

The table below shows if the areas above will use 8% of cement in back fill instead of 14% cement

No.

Date

Location

%Cement

Material Usage

Paste Product

Vs Dry Tuff

Cement

Water

Tuff (wet)

Tuff dry

Tuff

Tons

Tons

Tons

Tons

M3

Tons

M3

1

40729

K2-Sub 9’D’ Sill South OD.03

8%

48

286

809

604

884

1143

706

2

40732

K2-Sub 12’B’ Sill South OD.03

8%

11

70

179

134

196

260

161

3

40733

K2-Sub 12’B’ Sill South OD.03

8%

11

68

188

140

206

268

165

4

40733

K2-Sub 9’D’ Sill South OD.01

8%

28

171

463

346

506

662

408

5

40748

K2 – Sub 11 ‘A’ UC.1 North OD.05

8%

40

237

668

499

730

945

584

6

40748

K2 – Sub 11 ‘A’ UC.1 North OD.05

8%

9

52

155

115

169

216

133

7

40750

K2 – Sub 11 ‘A’ UC.1 North OD.05

8%

1

9

23

17

25

33

20

8

40751

K2 – Sub 11 ‘A’ UC.1 North OD.05

8%

4

28

74

55

81

106

65

9

40796

K2 – Sub 9 ‘D’ Sill South OD.1

8%

43

262

724

540

791

1029

635

10

40814

K2 – Sub 12 ‘B’ Sill South OD.01 (#1)

8%

72

408

1203

898

1315

1683

1039

11

40816

K2 – Sub 12 ‘B’ Sill North OD.02

8%

32

199

538

402

588

770

475

12

40823

K1 – Sub 6 ‘A’ UC3 North OD.01

8%

78

453

1306

974

1427

1837

1134

13

40824

K1 – Sub 6 ‘A’ UC.3 North OD.01

8%

14

89

235

175

257

338

209

14

40824

K1 – Sub 6 ‘C’ UC.3 North OD.02

8%

38

232

630

470

688

899

555

15

40824

K1 – Sub 6 ‘C’ UC.3 North OD.02

8%

32

183

531

396

581

746

461

 

Selection of the preferred alternative:

     

VARIANCE AFTER IMPROVEMENT

PRICE

COST SAVING AFTER IMPROVEMENT

 

No.

Date

Location

Cement

Tuff

Cement

Tuff

 

Cement

Tuff

Tuff

USD / ton

USD / m3

IDR / ton

IDR / m3

USD

IDR

 

Tons

Tons

M3

152.23

$ 10.46

1,351,473

92,234

 

1

5-Jul-11

K2-Sub 9’D’ Sill South OD.03

35

(35)

(38)

5,364

(366)

47,311,437

(3,228,879)

$ 4,998

44,082,557

 

2

8-Jul-11

K2-Sub 12’B’ Sill South OD.03

8

(8)

(8)

1,190

(81)

10,492,380

(716,077)

$ 1,108

9,776,303

 

3

9-Jul-11

K2-Sub 12’B’ Sill South OD.03

8

(8)

(9)

1,248

(85)

11,004,183

(751,006)

$ 1,163

10,253,177

 

4

9-Jul-11

K2-Sub 9’D’ Sill South OD.01

20

(20)

(22)

3,073

(210)

27,101,057

(1,849,575)

$ 2,863

25,251,482

 

5

24-Jul-11

K2 – Sub 11 ‘A’ UC.1 North OD.05

29

(29)

(32)

4,432

(302)

39,086,282

(2,667,534)

$ 4,129

36,418,747

 

6

24-Jul-11

K2 – Sub 11 ‘A’ UC.1 North OD.05

7

(7)

(7)

1,026

(70)

9,048,054

(617,506)

$ 956

8,430,549

 

7

26-Jul-11

K2 – Sub 11 ‘A’ UC.1 North OD.05

1

(1)

(1)

150

(10)

1,326,824

(90,552)

$ 140

1,236,272

 

8

27-Jul-11

K2 – Sub 11 ‘A’ UC.1 North OD.05

3

(3)

(3)

490

(33)

4,321,161

(294,908)

$ 456

4,026,253

 

9

10-Sep-11

K2 – Sub 9 ‘D’ Sill South OD.1

31

(31)

(34)

4,800

(328)

42,337,945

(2,889,452)

$ 4,473

39,448,493

 

10

28-Sep-11

K2 – Sub 12 ‘B’ Sill South OD.01 (#1)

52

(52)

(57)

7,977

(544)

70,354,071

(4,801,478)

$ 7,432

65,552,594

 

11

30-Sep-11

K2 – Sub 12 ‘B’ Sill North OD.02

23

(23)

(25)

3,571

(244)

31,491,745

(2,149,228)

$ 3,327

29,342,517

 

12

7-Oct-11

K1 – Sub 6 ‘A’ UC3 North OD.01

56

(56)

(62)

8,657

(591)

76,352,481

(5,210,853)

$ 8,066

71,141,628

 

13

8-Oct-11

K1 – Sub 6 ‘A’ UC.3 North OD.01

10

(10)

(11)

1,558

(106)

13,744,204

(938,005)

$ 1,452

12,806,198

 

14

8-Oct-11

K1 – Sub 6 ‘C’ UC.3 North OD.02

27

(27)

(30)

4,184

(286)

36,902,386

(2,518,489)

$ 3,898

34,383,897

 

15

8-Oct-11

K1 – Sub 6 ‘C’ UC.3 North OD.02

23

(23)

(25)

3,523

(240)

31,072,337

(2,120,604)

$ 3,283

28,951,733

 
           

TOTAL SAVING FROM JUL-OCT’2011

  

$ 47,744

421,102,399

 
                         

With this initiative in reducing cement percentage from 14% to 8%, cost saving in cement consumption from July – October 2011 is $ 47,744

Performance monitoring and post-evaluation of results:

This will be permanent practice going forward for back fill areas where we will be mining in the next more than 3 months later for mining beside ore drift.

 

Reference:

  1. Sullivan William. Wicks M, Elin. Koelling C, Patrick. Engineering Economic, Fifteenth edition. Pearson International Edition, 2009

 

                                                    

 

 

W12_ET_Accelerator Cost Reduction_Kristal2011


Problem Statement:

Following up on the ground support consumables cost reduction project, one of the initiative is we are looking into alternatives in accelerator type to reduce 5% of overall ground support consumables cost. Currently we are using “A” product and looking for the opportunity to other product or brand

Alternatives:

After reviewing several offerings from several products and reviewed their specification who meets our technical requirements, we decided to trial “B” product.

Criterion:

The criterion will be technical requirement that can be accepted by geotechnical aspects and lower price from current supplier/product.

Analysis and Comparison:

Table below is for cost comparison only between two accelerators from “A” and “B” brand

Fibre Chip – Cost Savings Calculation
     
“A” Brand

11.05

SGD

1 SGD

6551.65

IDR

     
“A” Brand 72,395.73

IDR

“B” Brand 51,200.00

IDR

Saving Per Kg 21,195.73

IDR

     
     
Daily Shotcrete Consumption

60

M3/day

1 M3 Shotcrete

3

kg/M3

     
Cost Savings Rp 3,815,231.85

IDR/day

Cost Savings per Annum Rp 1,373,483,466.00

IDR/year

  $ 150,107.48

IDR/year

 

Selection of the preferred alternative:

Assuming that accelerator from “B” brand is reliable, accepted from geotechnical point of view, and based on the cost comparison above, we can come up with the decision to use accelerator from “B” brand which will give us $150,107.48 cost saving in accelerator consumption per year.

Performance monitoring and post-evaluation of results:

Geotechnical team will keep continue monitor the application of this accelerator especially in early strength and 28 days strength test in shotcrete to make sure the application will meet ground support standard to make sure a safe mine environment. Review and evaluation will be sent and done weekly and monthly for 6 months period.

 

 

Reference:

  1. Sullivan William. Wicks M, Elin. Koelling C, Patrick. Engineering Economic, Fifteenth edition. Pearson International Edition, 2009

 

 

 

W11_ET_Development Cycle Process_Kristal2011


Problem Statement:

As part of improvement process in the business unit, we are doing an evaluation for our development cycle in order to find any ways to improve it. Development cycle in underground mine could be varying depends on its method. Underground mine has several mining methods depends on its ore body geometry and shape, geology characteristic, mineralization, rock characteristic, etc. Picture below shows a development cycle in our mine with underhand cut and fill method combine with long hole stope.

 

Alternatives:

When we determine and review the development cycle, this can be expanded to wider purpose as a multiple purpose project as the result gained can be used to evaluate each step in the cycle. In this instance, we can review further in Drilling activity – Charging activity – Ground support activity – etc to improve productivity on each step and will impact to the overall development cycle. In evaluating cycle time we can use data from Pitram/DOME that record our mine activities and also we can use actual data collecting in the field directly by assigning our production engineers.

Criterion:

Cycle time would be the parameter on this evaluation without ignores the safe production. The shorter development cycle we can gain is the better.

Analysis and Comparison:

From actual data collecting that was done by Production engineers, it can be compiled and found the Pareto chart as shown below:

 

There are top 4 activities that decided to be reviewed in detail and can be continued on its own improvement project leading by each project manager to be more focus develop some action plans to reduce the cycle time.

Selection of the preferred alternative:

As seen on the Summary Pareto Chart, there are top 4 activities:

  1. Charging
  2. Mesh & Bolting
  3. Shotcrete
  4. Grouting

Performance monitoring and post-evaluation of results:

Four activities above need to be highlighted in management concern as priority to be reviewed to reduce development cycle. Some actions need to be taken and divided in 4 different improvement projects that will be led by production engineers and the team. In instance, for Spraying Pareto chart below for shotcrete activity, activity “Waiting” need to be a concern and need to be reduced as soon as possible.

By implementing fish bone diagram to find the root cause, “Waiting” time should be eliminated and replaced with something that can give benefit to production.

 

Reference:

  1. Sullivan William. Wicks M, Elin. Koelling C, Patrick. Engineering Economic, Fifteenth edition. Pearson International Edition, 2009
  2. Paul Keller – Mc Graw Hill, Statistical Process Control, Chapter 7, 2011
  3. The Memory Jogger 2, p122-134

 

 

                                                    

 

 

W13_Adi_CPM and Schedulling of “Establish a Schedule” Project (Humphreys Case Study Chapter 9)


Problem Statement

A project is about to begin. The project name is “Establishing Project Schedule” , its objective is to create the schedule in bar chart and also establish Critical Path Method to identify which activities are critical. A given date and activity list has been provided prior to the project planning.

Alternative Solution

Solution to execute this project will be describe as the following steps:

  1. Breakdown all the activities items of the project scope.
  2. Define the network logic for all activities.
  3. Prepare the Precedence Diagram Method to Map all activities and its network logic.
  4. Define duration of each activity
  5. Set date and float calculation
  6. Construct a abar chart.

 

Development of feasible alternatives

List of activities of project are as shown below:

Activity

Description

A

Define General Project Scope

B

Detailed Project Scope, Incl. Master List

C

Develop Master Schedule

D

Determine Level of Schedule Detail

E

Define Detailed Activities

F

Define Responsibility Assignments

G

Develop Detail Schedule Logic

H

Assign Resource to Activities

I

Determine Preliminary Activity Times

J

Determine Preliminary Lead Times

K

Review Acitivity Durations

L

Calculate Early and Late Dates

M

Check Feasibility & Efficiency of resource

N

Compare Calculated Dates for Milestones w/ Required Dates

O

Revise Detailed Logic and Durations

P

Resource Level the Schedule

Q

Review the Network for Inclusion of All Activities

R

Revise the Network

S

Review Activity Responsibility Assignments

T

Revise Responsibility Assignments

U

Review Network Logic

V

Revise Network Logic

W

Fineal Review of Resource Profiles

X

Revise Resource Plan

Y

Approve Schedule Baseline

 

All activities shall be connected each other by network logic to create a sequential and logical step of works that create a project.

A network logic has been define as follow:

NETWORK LOGIC

1

Activity A initiates the project

2

Activity A precedes activities B and C, which may proceed concurrently

3

Activity A precedes activity D

4

Activity C and F precede activity G

5

Activity D precedes activity E

6

Activity E precedes activity F

7

Activity G precedes activities H, I, and J, which may proceed concurrently

8

Activity H and I precede activity K

9

Activity J and K precede activity L

10

Activity L precedes activities M and N, which may proceed concurrently

11

Activity M and N both precede activity O

12

Activity O precedes activity P

13

Activity P precedes activities Q and W, which may proceed concurrently

14

Activity Q precedes activity R

15

Activity R precedes activities S and U, which may proceed concurrently

16

Activity W precedes activity X

17

Activity S precedes activity T

18

Activity U precedes activity V

19

Activity T,V, and X precede activity Y

20

Activity Y completes the project

 

After network logic has been defined, we can visualized the sequence by using Precedence Diagram Method:

 


 

Next step is to ddetermine the duration for each activity:

Activity

Durations (days)

  

Activity

Durations (days)

A

2

  

N

1

B

10

  

O

2

C

4

  

P

5

D

1

  

Q

1

E

4

  

R

1

F

2

  

S

1

G

8

  

T

1

H

3

  

U

1

I

2

  

V

1

J

4

  

W

1

K

2

  

X

4

L

1

  

Y

1

M

1

  

  

  

 

 

Analysis of Alternative Solution

To create a CPM, we need to analyze date and float from given PDM and duration. CPM will be created based on value of Early Start, Early Finish, Late Start, Late Finish, Total Float, and Free Float obtained by date and float analysis.

The early dates are calculated on the Forward Pass, while the Late dates are obtained by performing the Backward Pass. After running the two “passes” we should have visualization of CPM as shown below:

 


By create the CPM, we are not only obtain the Early and Late Dates, but also the value of float. If the value of float of a path is equal to zero, then the path sholud be noticed as Critical Path. The critical path on the above CPM is marked in red arrow.

W14_Adi_WBS development for Conceptual Study Phase of Project


Problem Statement

An “X” oil company has completed their exploration and drilling activity in eastern Indonesia for a gas field. Well completion has been done and ready to produce and process the hydrocarbon product. The well is located about 27 Km south of Sorong offshore. Well test report has result a significant number of hydrocarbon impurities (H2S and CO2) which need special treatment to produce gas that will meet the specification required by the gas buyer.

Alternative Solution

Alternative A :

Construct Central Processing Platform (CPP) near the offshore Wellhead Platform (WHP), which means to put all process equipment and facilities on the CPP. The impact of this option, is the size of platform structure will be enormous since lot of heavy equipment are mounted on it.

Alternative B :

Construct Central Processing Platform (CPP) at the nearest onshore area and connect it to Wellhead Platform (WHP) by 27 km Corrosion Ressistant Alloy (CRA) offshore pipeline, which means they can eliminate the necessity to construct an offshore platform.

Development of feasible alternatives

Identify and define the Major Scope of works for each alternative

Scope of Works Alternative A :

  • Additional Wells Tie in
    • Well Site Facilities
    • Gas Gathering (Flowline) System and its Tie-in.
  • Offshore CPP Fabrication and installation
    • CPP Topside, include risers,living quarters, helideck, flare, deck structures and appurtenances
    • CPP Substructures, including CPP Jackets, pile and mudmats
  • Offshore Gas Processing Facilities
    • Gas Processing Train,
    • Condensate handling facility
    • Produced Water facility
    • H2S removal for HSE purpose
    • Amine system for CO2 removal
  • Utilities and Off-site Facilities.
  • Metering Facilities and its Tie-in
  • Flowlines/Pipelines

Scope of Works Alternative B :

  • Additional Wells Tie in
    • Well Site Facilities
    • 27 km CRA flowline and its Tie-in.
  • Onshore Gas Processing Facilities
    • Gas Processing Train,
    • Condensate handling facility
    • Produced Water facility
    • H2S removal for HSE purpose
    • Amine system for CO2 removal
  • Utilities and Off-site Facilities.
  • Metering Facilities and its Tie-in
  • Flowlines/Pipelines

Analysis and Comparison of Alternatives

Both alternatives will be mapped as Work Breakdown System to explore and identify all activities which become input prior to project scheduling and cost estimate development. The Work Breakdown System development in this Conceptual Study/ Several Options phase will refer to Physical Breakdown System of Norsk Standard Z- 014 to anticipate Class 5 – Class 4 cost estimate.

Alternative A :

Alternative B :


Selection of Preferred Alternative

From the both WBS above, we can categorize that Process and Utillities part (Yellow Boxes) are almost typical each other, while the rest of them (Pink Boxes) is completely different in terms of types and volume of works, that will govern a different project cost estimation in the end.

The preferred alternative can be determined by considering multiple Technical aspect and Economic/Cost aspect. Considering that “X” oil company has a lot of experiences of handling projects typical and more complex than this project, hence the Economic/Cost aspect will be the biggest concern in determining the preferrred alternative. A cost estimation shall be used as a basis to perform economic analysis and select the best alternative.

Performance Monitoring & Post Evaluation of Result

The next step to perform selection of alternative in this phase Conceptual Study/ Several Options of project, is to transform the developed WBS above into preliminary cost estimation. By using a set of guidelines for estimating, the established WBS shall be equipped with WBS dictionary which defines the boundary of scope for each element. A standard estimate template need to be defined prior to the estimating process to ensure that the cost estimation its consictency and traceability. Since the project execution will take times from starting point at phase Conceptual Study/ Several Options, it is important to take into account the escalating factor for both of material and labour cost so that we can deliver a more accurate cost estimation.

References

Humphreys, Gary C (2002),Project Management Using Earned Value, Orange,CA: Humphrey & Associates, Inc.

Norwegian Technology Centre (2002), SCCS Norsok Standard Z-014, Oslo: Norsk Teknologisenter.

Sullivan, William G., Wicks, Elin M. & Koelling, C. Patrick (1942), Engineering Economy15th Edition, Singapore: Prentice Hall, Inc.


W2_Adi_The Gas Plant


Problem Statement

“X” Oil Company intends to acquire an old natural gas field at East Kalimantan, which has been previously operated by another company. Based on subsurface study, the reserve can be produced for another 15 years of 20 MMSCFD gas. Since the existing surface production facility has been obsolete, the “X” Oil Company needs to construct the one to replace the existing facilities. An assessment of the new production facility should be done prior to set Gas Sales Agreement (GSA) with the buyer. The board of management “X” Oil Company needs to know whether their investment is worth doing or not. They also expect the payout period should be less than 5 years.

Root Cause Analysis

  1. Availability of old gas field reserve that still can be produced
  2. Existing facility can provide gas content information and estimation basis for the new facility construction, means easier engineering process for the new surface production facility.
  3. National Electricity Company is demand more energy supply for local power needs.

Alternative Solution

Construct a new Surface Production Facility to process 20MMSCFD natural gas and deliver to the buyer. And assessment needs should be carried out to evaluate the economics of the project and determine which parameter that is sensitive to investment value, also to establish a firm gas sales price for GSA purpose. Since the market gas price is USD $4 –$5, per MMBTU. Four difference gas price scenarios will be analyzed to obtain best economic parameter, they are: USD $4, $4.25, $4.5, and $4.75.

Selection Criteria

  1. NPV
  2. MARR – 15%
  3. IRR

Analysis and Comparison of Alternatives

Preliminary data and estimation

Table 1. Project Information

 

Table 2. Baseline Cash flow calculation

 

 

 

Table 3. Sensitivity Analysis Calculation

 

 

 

 

 

 

 

 

From the table 3, we can plot Spider graph as follow:

Figure 1. Sensitivity Analysis

Based on sensitivity analysis, we figured out that the revenue by terms of price is governed here. Hence the economic optimization and evaluation will be based on parameter gas price.. Using formula in spread sheet ,we obtain the the following.

Table 4. Gas Sales Price Scenarios

 

Figure 2. Gas Price vs IRR

 

Selection of Preferred Alternative

From Table 4, we can conclude that best scenario is at Gas Price USD $4.75 per MMBTU, refer to criteria NPV, IRR and Payout time. Then the project is worth doing, with the gas price $4.75 per MMBTU resulting NPV>0, IRR>MARR, and Payout Time less than five years.

Performance Monitoring & Post Evaluation of Result

  1. Scope of work should be well defined prior to project execution to avoid unnecessary change order which increase the Capital Investment value.
  2. Conduct project monitoring and supervision to ensure actual project progress and cost inline with the plan.
  3. Operation and maintenance management should be applied to avoid excessive operation cost.

References

Sullivan, William G., Wicks, Elin M. & Koelling, C. Patrick (1942), “Engineering Economy15th Edition”, Singapore: Prentice Hall, Inc.

Widjajono, Partowidagdo (2009), “Oil, Gas, and Energy in Indonesia: Problems and Policy Analysis”, Bandung: Development Studies Foundation.

W3_Adi Nugroho_My Future House_Kristal2011


Problem Statement
In order to increase the employee’s loyalty and security of from the need of housing, BPMIGAS has recently issued Housing Loan Program (HLP) for its employees. The program will provide a ten years period loan of a certain amount from the corporate Bank with only 3% interest, while the rest of interest is paid by company. Realizing the opportunity above, I intend to get a house and apply for the program. There are four  options of house to buy, I have to choose the best option for my future house based on budget and criteria i had set before.

Development of alternatives
Four nominated house are about to be analyzed and selected, with budget Rp 250 Million. The following are the details of each option based on glance survey:

  1. House #1 at Bumi Serpong Damai-Tangerang, worth Rp 300 Million. The location has a complete adjacent public facilities such as Hospital, School, and Mall. Distance driving to my office is about 35 km, adequate public transportation, and has Toll Road Access. The location is a cluster type, means has a good security. This house is overbudget, so i need to seek for other loan to afford the house.
  2. House #2 is located at Puri Gading-Bekasi, worth Rp 245 Million; Distance driving to my office is about 20 km, adequate public transportation, and has Toll Road Access. Has good neighborhood security, but a bit far from public facilities.
  3. House #3 at Pamulang-Tangerang,worth Rp 225 Million; Distance driving to my office is about 30 km, doesn’t have adequate public transportation and no Toll Road Access. The house has medium neighborhood security, and have no nearest public facilities.
  4. House #4 is in Bogor, worth 190 Million. Distance driving to my office is about 45 km, has adequate public transportation, and Toll Road Access. But the neighborhood security is poor, and way too far from public facilities.

Selection Criteria
The criteria as basis of house selection are as follow:

  1. The Cost
  2. Distance from workplace
  3. Public Tansportation and Toll road access
  4. Public Facilities
  5. Neighborhood Security

 Analysis and Comparison of Alternatives
Non-dimensional Compensatory Model is used as a tool and technique to quantify analysis, which based on some attributes/criteria in order to choose an optimum result.

Table 1 Non Dimensional Scaling

Table 2 Additive Weighing Factor

Table 3 Compensatory Model

Selection of the Preferred Alternative
From the compensatory model, we obtain that the preferred option house to buy is House #2 located at Puri Gading-Bekasi, since it has maximum total score (score=0.8).

Performance Monitoring & Post Evaluation of Result

  • Conduct a thorough survey to confirm the data.
  • Complete the administration of HLP application to immediately get the money from the bank, before the house is sold to other buyer.

References
Sullivan, William G., Wicks, Elin M. & Koelling, C. Patrick (1942), Engineering Economy15th Edition, Singapore: Prentice Hall, Inc.