Backorder strategy subcontracting where to do the

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Unformatted text preview: rder strategy. Subcontracting. Where to do the Aggregate Where Planning? Planning? 2 Aggregate Units The method is based on notion of aggregate units. They The may be may Actual units of production Actual Weight (tons of steel) Weight Volume (gallons of gasoline) Volume Dollars (Value of sales) Dollars Fictitious aggregate units Fictitious Example of fictitious aggregate Example units. units. One plant produced 6 models of washing machines: One Model Model A 5532 K 4242 L 9898 L 3800 M 2624 M 3880 # hrs. 4.2 4.9 5.1 5.2 5.4 5.8 Price 285 345 395 425 525 725 % sales sales 32 21 17 14 10 06 Question: How do we define an aggregate unit here? 3 Example Notice: Price is not necessarily proportional to worker hours (i.e., cost): why? hours One method for defining an aggregate unit: requires: .32(4.2) + .21(4.9...
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