Refers result from making changes from one period to

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Unformatted text preview: making changes from one period to the next. result Bottleneck Planning. Problem in meeting peak demand Bottleneck Problem because of capacity restrictions. Planning Horizon. Assumed given (T), but what is “right” Planning Assumed value? Rolling horizons and end of horizon effect are both important issues. Treatment of Demand. Assume demand is known. Treatment Assume Ignores uncertainty to focus on the Ignores predictable/systematic variations in demand, such as predictable/systematic seasonality. seasonality. Costs in Aggregate Planning Smoothing Costs Smoothing changing size of the work force changing changing number of units produced changing Holding Costs Holding primary component: opportunity cost of investment investment Shortage Costs Shortage Cost of demand exceeding stock on hand. Why should shorta...
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