Analysis of Factors Causing Rejection of Material Selection Based on Country of Origin (COO)

Ahmad Irwiyan Haq, Moses Laksono Singgih

Abstract


There are 19 power generation industries in East Java with a total capacity of 8000MW with various types of generation processes that work every day. To support this process they need good quality materials or equipment. Many of these equipment are produced overseas. However, the issue that is currently developing regarding the selection of materials is the Country of Origin (COO). COO is defined as the country where the last product is subject to an economic, commercial or technically significant manufacturing or assembly process. Until now, the Country of Origin has had a profound effect on material selection in tenders at the generation companies in East Java. In this study will analyze the factors that influence the selection of materials based on the Country of Origin (COO) by conducting a survey of those who have authority over the purchase of goods in the Power Generation Industry in East Java. The data obtained will be analyzed using the Structural Equation Model (SEM) - Partial Least Square (PLS) method, from the analysis results obtained that the factors causing rejection of material selection based on the Country of Origin in the Power Generation Industry in East Java is brand and product judgement.

Keywords


power generation; country of origin; Structural Equation Model (SEM)-Partial Least Square (PLS)

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DOI: http://dx.doi.org/10.12962/j23546026.y2019i5.6281

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