Management and Production Engineering Review

Abstract

The implementation of milk-run in Indonesia has been started since 2005. As a developing country, there is a challenge to operate milk-run smoothly especially in urban area due to severe traffic congestion and unfavourable road condition in some areas. This research aimed to analyze the practice of milk-run operation in one of the biggest Japanese automotive companies in Indonesia. Transportation Value Stream Mapping (TVSM) is applied in order to perform just-in-time delivery in the supply chain before operating milk-run. It is discussed that this company still need to continue in improving milk-run operation. The operation system needs control and integration from manufacturer, supplier and logistics partner. The advantage of milk-run operation is cost reduction and also support green logistics in decreasing emission of carbondioxide (CO 2 ) by reducing the number of trucks used.