Identification and risk mitigation strategy of cocoa commodities supply chain using fuzzy house of risk method (Fuzzy-HOR)
Keywords:Cocoa, Fuzzy-HOR, Risk Mitigation, Supply Chain.
Supply Chain Management should be considered in a business entity as it relates to the process of managing the flow of goods from upstream to downstream. The supply chain process involves multiple parties, in which each of the parties involved may pose a supply chain risk so that supply chain risk management is required to manage supply chain activities. PT. XYZ as the research place is located in Blitar, East Java which is one of the business entities engaged in cocoa commodities. Currently, PT. XYZ has not had a structured supply chain risk management yet to identify and mitigate risks. This study aims to identify supply chain risk and determine risk mitigation strategies that need to be applied. The method used was Fuzzy-HOR. This study involved expert respondents consisting of cocoa farmers and employees (production managers and operational managers). The result of risk identification found 11 risks on farmerâ€™s activity which was composed of 15 risk agents. Next, 19 risks were found on companyâ€™s activity which was consisted of 25 risk agents. Calculation results using Fuzzy-HOR on phase 1 resulted in 9 risk agents on farmerâ€™s activity and 18 risk agents on companyâ€™s activity that required mitigation strategies design. In Fuzzy-HOR phase 2, there were 17 farmerâ€™s mitigation strategies and 30 companyâ€™s mitigation strategies.
 Ministry of Industry. Overview of Cocoa Industry. Jakarta: Secretariat General of the Ministry of Industry, 2007 (Text in Indonesia.
 Directorat General of Plantation. Plantation Statistics Indonesia Cocoa Commodity 2013-2015. Jakarta: Directorat General of Plantation, 2014 (Text in Indonesia).
 T. Wahyudi, T. R. Panggabean, and Pujiyanto. Cocoa Complete Guide. Jakarta: Penebar Swadaya, 2008 (Text in Indonesia).
 P. Singhal, G. Agarwal, and M.L. Mittal, â€œSupply Chain Risk Management: Review, Classification and Future Research Directionsâ€ International Journal of Business Science and Applied Management., vol. 6, pp. 15-42, 2011. https://doi.org/10.4018/978-1-60960-135-5.ch002.
 K. O. Sarpong, O.F. Alexander, and E.K. Anin, â€œAn Assesssment of Supply Chain Risk in the Cocoa Industry in the Ashanti Region, Ghanaâ€ International Journal of Humanities and Social Science., vol. 3, pp. 191-201, 2013.
 H. Aini, M. Syamsun, and A. Setiawan, â€œRisk of Cocoa Supply Chain in Indonesia with Analytic Network Process and Failure Mode Effect Analysis Integrated Methodâ€ Journal of Management & Agribusiness., vol. 11, pp. 209-219, 2014 (Text in Indonesia).
 Y. R. Perdana, â€œLogistics Information System for Supply Chain of Agricultural Commodityâ€ Social and Behavioral Sciences., vol. 65, pp. 608-613, 2012 https://doi.org/10.1016/j.sbspro.2012.11.172.
 W. Ho, T. Zheng, H. Yildiz, and S. Talluri, â€œSupply Chain Risk Management: A Literature Reviewâ€ International Journal of Production Research., vol. 53, pp. 5031-5069, 2015 https://doi.org/10.1080/00207543.2015.1030467.
 I. Etikan, S. A. Musa, and R. S. Alkassim, â€œComparison of Convenience Sampling and Purposive Samplingâ€ American Journal of Theoretical and Applied Statistics., vol. 5, pp. 1-4, 2016 https://doi.org/10.11648/j.ajtas.20160501.11.
 I. N. Pujawan and L. H. Geraldin, â€œHouse of Risk: A Model for Proactive Supply Chain Risk Managementâ€ Business Process Management., vol. 15, pp. 963-967, 2009 https://doi.org/10.1108/14637150911003801.
 J. A. P. Mendoza, â€œAnalytical Hierarchy Process and SCOR Model to Support Supply Chain Re-designâ€ International Journal of Information Management., vol. 34, pp. 634-638, 2014 https://doi.org/10.1016/j.ijinfomgt.2014.06.002.
 A. Lutfi and H. Irawan. 2012. Analysis of Supply Chain Risk Using House of Risk Model (Case Study at PT. XXX). Journal of Indonesia Management., vol. 12, pp 1-11, 2012 (Text in Indonesia).
 I. Alwi, â€œEmpirical Criteria in Determining Sample Size on Testing Statistical Hypothesis and Grain Analysisâ€ Formatif Journal., vol. 2, pp. 140-148, 2015 (Text in Indonesia).
 Rahmatin, N., Santoso, I., Indriani, C., Rahayu, S., Widyaningtyas, S., Integration of the Fuzzy Failure Mode and Effect Analysis (Fuzzy FMEA) and the Analytical Network Process (ANP) in Marketing Risk Analysis and Mitigation. International Journal of Technology. vol.9(4), pp.809-81, 2018. https://doi.org/10.14716/ijtech.v9i4.2197.
 Santoso,I., Saâ€™adah,M., Wijana, S.,. QFD and Fuzzy AHP for Formulating Product Concept of Probiotic Beverages for Diabetic. Telkomnika, 15(1), pp. 391-398, 2017. https://doi.org/10.12928/telkomnika.v15i1.3555.
 E. N. Hayati, â€œSupply Chain Management (SCM) dan Logistic Managementâ€ Journal of engineering dynamics., vol 8, pp. 25-34, 2014 (Text in Indonesia).
 B. Utoyo. Geography Opens the World's Horizon. Bandung: Setia Purna Inves, 2009 (Text in Indonesia).
 P. Mensah and Y. Merkurvey, â€œDeveloping a Resilient Supply Chainâ€ Social and Behavioral Sciences., vol. 110, pp. 309-319, 2014 https://doi.org/10.1016/j.sbspro.2013.12.875.
 S. I. Tjipto, â€œPerformance Analysis on Supply Chain Management of Construction Services Companyâ€ Journal of Management., pp. 1-12, 2014 (Text in Indonesia).
 N. E. Wahyudin and I. Santoso, â€œModelling of Risk Management for Product Development of Yogurt Drink Using House of Risk (HOR) Methodâ€ The Asian Journal of Technology Management., vol. 2, pp. 98-108, 2016. https://doi.org/10.12695/ajtm.2016.9.2.4.
 L. Laricha, Rosehan, and Cynthia, â€œProposed Quality Improvement with Six Sigma and FMEA Method (Mode of Failure and Effect Analysis) On MBC Roller Conveyor Production Process at PT. XYZâ€ Scientific Journal of industrial engineering., vol. 1, pp. 88-94, 2013 (Text in Indonesia).
 T. Kusmantini, A. D. Guritno, and H. C. Rustamaji, â€œMapping of Supply Chain Risk in Industrial Furniture Base on House of Risk Frameworkâ€ European Journal of Business and Management., vol. 7, pp. 104-115, 2015.
 F. Tampubolon, A. Bahaudin, and P. F. Ferdinant, â€œManagement of Supply Chain Risk Using House of Risk Methodâ€ Industrial Engineering Journal., vol. 1, pp. 222-226, 2013 (Text in Indonesia).
 S. J. Benjamin, M. S. Marathamuthu, and U. Murugalah, â€œThe Use of 5-WHYs Technique to Eliminate OEEâ€™s Speed Loss in A Manufacturing Firmâ€ Journal of Quality in Maintenance Engineering., vol. 21, pp. 29-39, 2015. https://doi.org/10.1108/JQME-09-2013-0062.
 D. I. Handayani â€œA Review: Potensi Risiko Pada Supply Chain Risk Managementâ€. Jounal of Industrial Spectrum., vol. 14, pp. 1-108, 2016 (Text in Indonesia). https://doi.org/10.12928/si.v14i1.3701.
 R. Firdausa, N. W. Setyanto, and R. Yuniarti, â€œRisk Analysis of Risk Analysis Project Tool Queue C2000 Using House of Risk (Case Study at PT Cendana Teknika Utama)â€ Journal of Engineering and Industrial System Management., vol. 3, pp. 431-442, 2015 (Text in Indonesia).
 B. R. Kristanto and N. L. P. Hariastuti, â€œApplication of House of Risk (HOR) Model for Risk Mitigation on Leather Raw Materials Supply Chainâ€ Scientific Journal of Industrial Engineering., vol. 13, pp. 149-157, 2014 (Text in Indonesia).