Aggregate Planning

Aggregate Planning - Aggregate Planning Aggregate...

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Aggregate Planning Aggregate Planning
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Production and Operations Planning Production Process Design Long Term Capacity Planning Aggregate Planning Master Production Schedule Material Requirements Planning Individual Order Scheduling Demand Forecast
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The main idea behind aggregate planning Aggregate planning Translates business plans into rough labor schedules and production plans
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Issues to Consider for Aggregate Planning Production rate: “aggregate units” per worker per unit time Workforce level: available workforce in terms of hours Actual Production: Production rate x Workforce level Inventory: Units carried over from previous periods Costs: production, changing workforce, inventory
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What does aggregate planning do? Given an aggregate demand forecast , determine production levels, inventory levels, and workforce levels, in order to minimize total relevant costs over the planning horizon Given the number of variables, there is not a single optimal solution!
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Aggregate Planning Strategies 1. Chase strategy: match production rate to production requirements by varying the workforce (no inventory buildup or shortage allowed) 2. Level strategy: keep a constant workforce who work at maximum capacity (inventory will vary from period to period); workforce level chosen such that the total requirement over the planning horizon can be exactly met 3. Stable workforce: keep a constant workforce who work at maximum capacity; outsource in order to match production
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Aggregate Planning - Aggregate Planning Aggregate...

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