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Aggregate_Production_Planning_color_6x

# Aggregate_Production_Planning_color_6x - Sales of Turkey...

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5/8/2007 Industrial Data and Systems Analysis 1 Aggregate Production Planning Peter L. Jackson Professor School of O.R. and I.E. 5/8/2007 Industrial Data and Systems Analysis 2 Sales of Turkey Stuffing is Highly Seasonal Line Monthly Sales and Capacity for Line 101 0 50,000 100,000 150,000 200,000 250,000 300,000 350,000 400,000 1 2 3 4 5 6 7 8 9 10 11 12 Month Number Sales and Capacity (Cases) Line Monthly Sales Maximum Cases Per Month 5/8/2007 Industrial Data and Systems Analysis 3 Monthly Production and Capacity for Line 101 0 50,000 100,000 150,000 200,000 250,000 300,000 350,000 400,000 1 2 3 4 5 6 7 8 9 10 11 12 Month Number Production and Capacity (Cases) Required Production Maximum Cases Per Month The Bulldozer Method of Production Planning 5/8/2007 Industrial Data and Systems Analysis 4 Why is the Direction of Bulldozer Important? Monthly Sales and Capacity for Line 101 0 50,000 100,000 150,000 200,000 250,000 300,000 350,000 400,000 9 10 11 12 1 2 3 4 5 6 7 8 Month Number Sales and Capacity (Cases) Line Monthly Sales Maximum Cases Per Month 5/8/2007 Industrial Data and Systems Analysis 5 Safety Stock is Required Because of Sales Uncertainty Line Safety Stock At Month End for Line 101 0 20,000 40,000 60,000 80,000 100,000 120,000 140,000 160,000 1 2 3 4 5 6 7 8 9 10 11 12 Month Number Safety Stock (Cases) Safety stock at end of month 3 is driven by variability of sales in month 4. 5/8/2007 Industrial Data and Systems Analysis 6 Why Was Safety Stock So High for Month 3? Month 4 Variability Is this random variability or is this a trend? A statistical question. Sales of Product 285210 0 50,000 100,000 150,000 200,000 250,000 300,000 350,000 400,000 4 5 6 7 8 9 10 11 12 1 2 3 4 5 6 7 8 9 10 11 12 1 2 3 4 5 6 7 8 9 10 11 12 1 2 3 Month Number Monthly Sales (Cases)

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