CONTRACTOR EVALUATI ON AND SELECTION WITH ANALYTIC HIERARCH Y PROCESS METHOD FOR PROGRAMMABLE LOGIC CONT ROLLER PROGRAMMING SERVICES AT PT FREEPORT INDONESIA FINAL PROJECT In partial fulfillment of the requirements for the master’s degree from Institute Technology of Bandung By NILA YUDHITA Student ID: 29122162 (Master of Business Administration Program) INSTITUT TEKNOLOGI BANDUNG April 2024 i ABSTRACT CONTRACTOR EVALUATI ON AND SELECTION WITH ANALYTIC HIERARCH Y PROCESS METHOD FOR PROGRAMMABLE LOGIC CONT ROLLER PROGRAMMING SERVICES AT PT FREEPORT INDONESIA By Nila Yudhita Student ID: 29122162 (Master of Business Administration Program) Crusher conveyor systems in the underground mine serve as the backbone of the company’s copper mining operations in Papua – Indonesia, which necessitate PLC programming to enhance automation capabilities in mining operations. Contract Department of SCM Division is assigned an imperative task of contractor evaluation and selection for the PLC programming at PT Freeport Indonesia, given the company lacks the core competence and resources to conduct such services. The research study integrates theoretical insights on contractor selection, MCDM theory and AHP method, combined with industry benchmarks implemented by Contract Department of SCM) Division of PT Freeport Indonesia to define a robust set of selection criteria and their respective weights from company’s expert judgements as the basis to evaluate and assess the contractors. Implementing quantitative research methodology and Analytic Hierarchy Process method based on the selected criteria and sub-criteria, the research study utilizes primary data of expert judgment and secondary data of contractor quotations to develop integrative scoring system and provides recommendation of the best contractor with the highest final rating to be awarded the PLC programming projects in PT Freeport Indonesia. The research study uncovers the most relevant criteria for PLC programming services in PT Freeport Indonesia as project comprehension, price analysis, organization experience & project performance, and workforce composition. After running the AHP model, Contractor B emerged as the most superior contractor to conduct the required PLC services. In conclusion, this research study provides relevant and most important contractor selection criteria for PLC programming services and the recommended contractor for the higher company’s management to make informed decisions regarding PLC programming services for company’s mining operations. Keywords: Multi-Criteria Decision Making, Analytic Hierarchy Process (AHP), Contractor Selection, PLC Programming, Mining Industry ii ABSTRAK EVALUASI DAN SELEKSI KONTRAKTOR DENGAN METODE ANALYT IC HIERARCHY PROCESS UNTUK JASA PEMROGRAMA N PROGRAMMABLE LOGIC CONTROLLER DI PT FREEPORT INDONESIA Oleh Nila Yudhita Student ID: 29122162 (Program Studi Magister Administrasi Bisnis) Sistem konveyor penghancur di tambang bawah tanah menjadi tulang punggung perusahaan dalam operasi penambangan tembaga di Papua – Indonesia, yang memerlukan pemrograman PLC untuk meningkatkan kemampuan otomatisasi dalam operasi penambangan. Departemen Kontrak Divisi SCM diberi tugas mengevaluasi dan memilih kontraktor untuk pemrograman PLC di PT Freeport Indonesia, mengingat perusahaan tidak memiliki kompetensi dan sumber daya untuk mengerjakan proyek tersebut. Studi penelitian ini mengintegrasikan teori tentang pemilihan kontraktor, teori MCDM dan metode AHP, dikombinasikan dengan tolok ukur industri yang dipakai oleh Departemen Kontrak Divisi SCM PT Freeport Indonesia untuk menentukan kriteria pemilihan yang relevan beserta bobot masing-masing dari pendapat para ahli di perusahaan sebagai dasar untuk mengevaluasi dan menilai kontraktor. Dengan menerapkan metodologi penelitian kuantitatif dan Proses Hierarki Analitik berdasarkan kriteria dan sub-kriteria yang dipilih, penelitian ini menggunakan data primer berupa penilaian para ahli dan data sekunder berupa proposal kontraktor untuk mengembangkan sistem penilaian integratif dan memberikan rekomendasi berupa kontraktor terbaik dengan peringkat akhir tertinggi untuk mengerjakan proyek pemrograman PLC di PT Freeport Indonesia. Studi penelitian mengungkap bahwa kriteria yang paling relevan untuk jasa pemrograman PLC di PT Freeport Indonesia meliputi pemahaman proyek, analisis harga, pengalaman organisasi & kinerja proyek, dan komposisi tenaga kerja. Setelah dmetode AHP dilakukan, Kontraktor B terbukti sebagai kontraktor paling unggul untuk mengerjakan pemrograman PLC yang dibutuhkan perusahaan. Sebagai kesimpulan, studi penelitian ini menjelaskan kriteria pemilihan kontraktor yang relevan dan terpenting untuk jasa pemrograman PLC dan nama kontraktor yang direkomendasikan kepada manajemen perusahaan untuk mengambil keputusan mengenai pemrograman PLC untuk operasi penambangan perusahaan. Kata kunci: Pengambilan Keputusan Multi-Kriteria (MCDM), Proses Hierarki Analitik (AHP), Seleksi Kontraktor, Pemrograman PLC, Industri Pertambangan iii VALIDATION PAGE CONTRACTOR EVALUATI ON AND SELECTION WITH ANALYTIC HIERARCH Y PROCESS METHOD FOR PROGRAMMABLE LOGIC CONT ROLLER PROGRAMMING SERVICES AT PT FREEPORT INDONESIA VALIDATION PAGE By Nila Yudhita Student ID: 29122162 Master of Business Administration Program Institut Teknologi Bandung Approved Date: 28 February 2024 Supervisor Yos Sunitiyoso, S.T., M.Eng., Ph.D. iv DECLARATION OF NON-PLAGIARISM Plagiarism is: Taking, using, and submitting a work of another, including an idea, writing, or invention, as if it was her or his own. Plagiarism includes (but not limited to): 1. quoting verbatim the work of another without acknowledgement of the source. 2. paraphrasing the work of another without acknowledgement of the source.