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Unformatted text preview: anning, we can planning use different strategies: Chase, Level or a combination. Chase, Chase Strategy: produce quantity equal to aggregate demand for each period in order to keep inventory level zero. Level Strategy: Produce quantity equal to the average requirement over the planning horizon. Example 3 Chase Strategy
Period Capacity Requirement 1 5000 2 Constraints: Cannot exceed capacity. No shortages are permitted. What’s wrong with the basic plan? 8000 8000 Policies (constraint) examples: 1. Capacity in each period may be limited. 2. No shortages may be permitted (customer satisfaction). 3. No inventory is kept. 4. Must leave certain inventory at the end of period X. 5. Must meet demand during planning horizon. 6. Hiring and firing of workers. Sometime we may have soft constraints. We try to meet these soft constraints as much as possible.
7 Basic Plan 5000 End Inventory Inventory 0 Adjusted Plan 5000 End Inventory 0 3 4 Capacity exceeded in P3. 8000 8000 What can we do? 6000 8500...
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- Spring '10