S&OP Optimization Modeling
Optimization model A class of mathematical models
used when the user seeks to optimize some objective
function subject to some constraints.
Understand the pattern of resourc
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IE 7610 Homevvork 1 Due Feb 1
1. Afﬁnity Diagram (KJ Method)
In an internal survey about how to make your company to be more successful, the
following items of ideas are obtaine
2. The following data were collected over time as follows liﬁh‘t‘i’ Shel/l
Characteristic D(Defects) U(units) ‘0 (opportunity per unit) I)? U 0? 9 PF
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If the capital cost Within company is i=10% per year.
a) By using NPV, is this project worthwhile?
b) What is the project’s IRR?
c) W
- , ‘Aishwarya Sankar
' "‘ IE 7610: Six Sigma
HW 2
2/15/12
1. When an accounting ﬁrm audits a corporation, the ﬁrst phase of the audit involves
obtaining “knowledge of the business”. This phase of the
Homework 2
The solution here just list the common mistakes and the grade standard for each item in the
homework 2.
1. Critical path, Critical activity (1 point) : A, C, D, E, G
2. Shortest Duration (1
IE 7610 Homework 1 Due Feb 1
1. Affinity Diagram (KJ Method)
In an internal survey about how to make your company to be more successful, the
following items of ideas are obtained:
Low product maintena
Demand movement
Randomness Unpredictable movement from one time
period to the next.
Trend Long-term movement up or down in a time
series.
Seasonality A repeated pattern of spikes or drops in a
time se
Sales and Operations Planning
Sales and operations planning (S&OP) A process to
develop tactical plans by integrating marketing plans for
new and existing products with the management of the
supply ch
Level Production Plan
Actual Workers
Hold workforce constant at 105 (average workforce
over 12-month planning horizon)
Regular Production
105 x (160 hours per month/20 hours per set) = 840
sets per mo
Planning Values
Planning values Values that decision makers use to
translate a sales forecast into resource requirements and
to determine the feasibility and costs of alternative sales
and operations
Fine-Tuning the Plan
Rolling Planning Horizons
Rolling planning horizon A planning approach in which
an organization updates its sales and operations plan
regularly, such as on a monthly or quarterly
Mixed Production Plan
Cost of the Plan
Bottom-Up Planning
Steps are similar to top-down planning.
Main difference is that the resource requirements for
each product or service must be evaluated indivi
Seasonality Example 9.4
Causal Forecasting Models
Linear Regression
Multiple Regression
Examples:
Multiple Regression
Multiple Regression A generalized form of linear regression
that allows for more t
Collaborative Planning,
Forecasting, and Replenishment (CPFR)
CPFR A set of business processes, backed up by
information technology, in which members agree to
mutual business objectives and measures,
Exponential Smoothing Model
Exponential Smoothing Model A form of the moving
average model in which the forecast for the next period is
calculated as the weighted average of the current
periods actual
The grading standard is shown in the following part :
3. (1 point)
6
Yrt i 1 Yi 60.47%
4.1 (1 point)
r 1 i
1/ m
1
Method 1: m = 4
NPV =
20000 1000 4000
4500
.
5145
1
2
0
(1 r )
1 r 1 r
1 r 8
Meth