I AGGREGATE CLAW NING: TABULAR APFROALH ES 40 Gh “The inventory onhend atthe end of une was $00 units. The company wants 0 maintain a minim inventory of 300 units each month and would like to have 100 unison hand atthe end of December: Each unit requires five emplayeeshous to produce, there ar 20 working days each month, and each employee works an tight hour ay The workforce at he end of June was 35 workers, «2. Determinea mininum inventory prodction plan (je, one that allows artitary hiring and Eng) Determine the production plan that meets demand but doesnot hire o fre ‘workers during te six-month period, 13. Me Meadows Cooke Company makes a variety of chocolate chip cookies inthe plant in Albion Michigan, Based on orders received and forecasts of buying habits. Fisestisted ta! he demand forthe nex Our nthsis 85, |,260, $10, an! 980, ‘xpresed in thousands of cookies. During 2 46-day period when there were 120 workers, th company praduced 17 milion cookies. Assume that the nmber ‘ot wonkday over tte fut months are respectively 26,24, 20, and 16, There are a ‘Surely 100 workers played nd there sno stating inventory of cookies. ‘2, What isthe minimum constant workfore required to mest demand over the ext four month? 1b. Assume that y= 10 sents pr cookie per month ~ $100, and cp ~ $200. 5 alate the os: ofthe plan dived in part (2) loca semiconductor fim, Superchi, i planning ts workforce and production Revels over the text rear The firm makes variety of microprocessors and ses sales ollas as is aggrezate production measure. Based on orders rescived a sales forecasts provided ty the marketing department, te estimate of dollar ele othe next yea by month a follows: Producion Prediied Demand Mon___Bays_(n$t0000)_ | nwry 340 erty 16 ja Mach an 20 Bont 3 too Noy B 0 kee 20 as iy Pa srs popu 2 30 ; September 3 15 Osco 2 1s. Noverber 0 120 | Decmter ie 16 Inventory holding costs are based on #25 perent annual interest charge Tt | nip fat there wil be 675 workers onthe payroll atthe end ofthe surest Ses ed inventories wll amount to $120,000 The fm would ike to haveat east $100,000 of invenbry athe end of December nex year. It estimated tht cach worker accounts fran average of $60,000 of production per year (assume tat one Joa consists of 29 working days). The cost of hing anew worker is $200, and the cost of laying ea worker is $400,35 Sn Ase Pon Py Ler Pagan 41 «4 Determine the minimum constant sorkfoce that will meet the predicted demand forthe coming yet. 1, Bvalute the eos ofthe plan determined in part (2) (1s. Forthe da in Problem 14, determine hecot ofthe planthatchangesthe workforce sie cach prio io most cisely matehthe deman, ~9(76. Bap ine curative nt demand forte Suprchip dt of Problem 14, Graph ically determine a prodetion plan tat changes production levels po more than thre times and determine the total cost hat plan 3.5 SOLUTION OF AGGREGATE PLANNING PROBLEMS BY LINEAR PROGRAMMING Linen programming is term used te describe general class of optimization problems “The objecivesto determine values of nonnegative real variables inorder to maximize ‘minimize linear fueton ofthese variable tht ie sbject tm liner contains of | ‘these variables! The primary advantage in forolating a problem asa liner program is that optimal solutions ean be found very efficent by the simplex method. ‘When all cot fontions are liner, there ta linear programming formulation ofthe ‘gener aggregate planning problem, Because ofthe efficiency of commercial line [programming code, this means that essently) optimal sohition ean be obtaite for ‘ery lange problems * Cost Parameters and Given Information “The fllowing values ae astumed tobe known: ‘Cost of hiring one worker, cr ~ Cost of Fring one worker, (Cost of holding one unit of tock fo oe period, r= Cost of producing one unit on regular time, {40 Incremental cos f producing one sit on overtime, {ey lle cost pr unit of prodution, 5 = Cost to subcontract on uit of production, rh = Number of production day in pei, K = Number oF aggregate units produced by one worker in one day, y= Initial inventory 09 hand at the slat ofthe planning oso, 1g = titi workforce at the tart of the lang horizon, D, = Forecast of demand in period « ‘The ost parameters alsomaybe tin deperdent that's they maychange wiht. Time pendent cos parameters could be weful fer modeling changes inthe costs oF hin ‘or fring due, for example, shortages inte labor poo. or changes nthe cats of pro. {ucton andor storie de to shortages inthe suply of esurce, changes in inerest “amen of ines prpmeing cn ln nen hich owt chip ‘Te ur sncuded eoze nang mayo eopns vans Tel momos k= $60,000/250 = $240 per worker per day. After making the necessary adjustments tothe {demand vector in order to account forthe intial and the desired ending inventory, we can ‘compute the required workforce and the cost ofthe resulting plan through the following table: mame scum Uni Uni (8) Cum de Monthly Monthly Worker Worker Net Demand Demand (B/A] Product’ Product Working Gr Gn ‘Forecat— Foren Min fn Gn En Invent Month “Days $10,000) _ $10,000)__6 $1000) (a $10,000)_Workes $10,000) _$10000) a $10,000 re 2% 0a = 0912380708 TTT (208368 TORR ©0624 321 Oso nate 220928685 0L.60R 1100282172282 19045618 © 1000s $80 354312 asAsaa an ses SB 05s 2am 480, STR 27 nN SRS 88 6 204g 290s 214s 73837206 2256408 113.408 7 ost 3480 SSI TaR_aaTss27IM96 185.96, 8 2 028k 37683012376 20277 9.146 9 1904s 42S, 300} TIN BSA3I2 RDO 2K 1020828752 as BAB 310.256 Sasz304 44.300 1% 04) S252 1226s 37285 ae 264 TOTIOK 12 1603 S616 7S, B4G_ 6d, 298368 a303032_n20002, Wasi Tol 3987456 » Note: These figures assume the minimum constant workforce of 777 workers each month 8) Minimum constant work force = 777 workers. This solution utilizes slack monthly ‘capacities to build anticipatory inventories for subsequent months in the planning horizon, but it does not allow for backlogs. 'b) Cu=$200, C;= $400, Initial # workers = 675, Workers added = 102 Beg. Inv = $120,000. End inv = $100,000. “Total ending inventory = $39,874,560 + 100,000 = $39,974,560, Inventory costs per month = 0.25/12 = 0.0208 per $ per month Hence total hiring + inventory costs for the constant work fore plan are (200)(102) + (0.0208)(39,874,560+100,000) = $853,190 ‘Remark: Notice thatthe above computation ofthe “total” cost does not contain any cost ‘components pertaining to production cost and the labor cost. This is happening because the problem statement does not provide any data to compute these costs, But a more complete solution should account for these costs as well.Ne cm Demand Monthly Meaty CumNet_ End Forest Product Product Demand Invent ia Min® Workers Workes (nin Forest (a Workes Hed Fred 810.000) $10.00) _(n$10000)_ $104 TOs 3m oS RATS UBIO 3 OAS 2 16 038 380 99060 38160 708576 sis 321 osm 22037583, 2an2H8 oad ose 4 19 0486 100 20.17 100320 s00s.144 1 S23 0582 490 BRB LIT 1519320, 1x0) 6 20 0480 6251508 1S_ 0 eas 4a0 2148760 1760 7 M081 5756s? sh 305552 25203812 232 & 2 028 © HHO. to? 25g 10176 2as04s 2488 9 19 0486 178-384 «OBS. ITS 108 3005-502 2392 0 2 oss S18 3150792 272 ee ey en eS re) 3210782 292 16 O3u 175 436__06, 3445.95 2356 ‘Teale 3082 250 21912 (Cy =$200, Cy= $400 ‘Total cost of hiring, Firing and inventory = (200(2082) + (400)(2301) + (0:0208)(219,120+100,000) = $1,343,448 ‘Obviously, the remark atthe end ofthe previous problem applies this case as well, 16. ‘The following graph plots the cumulative net demand foreach month.“We need to dete «profile forthe cumulative production that piece-wiee linear with st moet four dstnet segments cine the production level can ‘change no more than thre times over the planning horizon. ‘+ itremains above the cumulative ret demand profile t every month (Since we want to meet the net forecasted demand every month; and ‘+ italso stays as close as possible tothe cumulative net demand profile (since we want 0 ‘minimize the excess inventories) ‘One such profile is plotted below: ‘The changes in production rate occur between periods 2 and 3, 4 and, and 7 and 8. These ‘breakpoints are chosen according tothe change ofthe slope ofthe fst plo. ‘The four production rates are chosen by trial and error to meet the demands for each month ‘without accumulating much excess inventory to subsequent periods. ‘The following table shows the proposed solution:Ne Unity Demand ‘Acual Cum Camber Worker Foret Prod, Product. Demand Working (i Desired (in Min Workers Workes ("Gn Roeca!_—*End Inet, Month 510,000) Prod__$10,000) Werkes_Hired Fred $10.00) $u csi ce aay te Sebo Mee tt soem Siar a0 76.258 16 03% 35400 380 om ask 0 SALOME TORSG 0336 21050 2000 220437, a8s 200248 87k as oss 19 04% 22000 100483450 220248 1148832 roan. 2 05 so200 499 910 aa?_ 0 St a0 Has. 18D 13182 2 0400 Soz00 6251046 «1358. —S02R0 2158232 10230 % O56 50200 MS am on 2.2m 2685:504 131504 12 02: 17500 310 gab O26 175104 DasDedS 72608 19 0886 17500175 38a e195. 108 3008712 am 2 Osi 1750 4S asz_ 5275 205 3181008 33.08 2 0480 17500 © 12036533175 200. 3356208 16 038 17800 178456 91__g 78104 3590312 ‘Toray 3s Ta05 Hence, the hirag, fring, and inventory cost of this plan i: (984)(200)+(1203)(400)+40.208)6,437,760+100,000) = $814,203.33 ‘Remark: Notice that the above plan still involves substantial hiring and firing, due tothe Variation of the working days n every month. IF we want to support the proposed prodtction plan with constant workforce at every phase of te plan where production rat is constant, and ‘witout experiencing any stockouts at any month, we must fix the number of workers a: every ‘Phase of the plan to the minimum level that will enable the achievement of the monthly production rate in every month ofthat phase. This number will essentially be determined by the ‘month in the phase with the smaller numberof days. This arrangement implies thet during the ‘months with a Figher number of working days, the employed workers will be under-utilized.AGGREGATE PLM NING? APH BSED ALPROACHCS ty 16 Ang Mag Pd ine of 0 ht 2770 ~ 2400. a inal the shadow pice 0 fe ‘hang sore the maximum wants Tas irpat ays oe, Ronee, rr we masts the LP termine the how pes yon the imu Study Questions | atu te ecnlagy lr shng gare planing model nar rogram we ‘halted nd AP mls we wel aa income yer (MRP ‘Sem epese plating dss at iy acon pe ne pining retin mony cee Milde sauihine misnswe? Whedben ncaa, tapes 0d Inplemenng AP els mp conus? ‘hy dees make ene to oni wore nig an ge laming manent in my ston? ‘Wha telirence etmeen hse podeion plan an lel duction a, wt Irpetiote anon’ of etry cai adhe cuneate ne? Fw do herodcton plane greedy 2 LP mad! eae hese wo psa Han? Inaba ermine prem een omnes, wh nemsn eth op drones 1b The opal bj econ. erie of which contains fea whi ek Shadow pes fore gt and sts oe com ‘Problems > (CF) Serrne apnea pans capaty by abet tng prot athe roton 1 Sto hw only LP (16 2-162) cae hs opto, mer we define ‘rinimom amt of aut! at mat be ped imps (Conese ar pao one erm conbact hap) fn act fou ut een be phe ned Tegr dvet ceapsey cont on supe a speed he fering iirc 1 How woud yu ify th fovmnion poe canet wt a spp sae6 Ph Prine 43S wmf LP (1661-1667 fe ws ang prom SSommonac re poate 9 Dime tn oot ex rein of mndcg en scan a ey che pi Prt Ph tarda ar sd may Te wt pl mio iy end tice phn fn ue he fra er eso wee Reacts em spree The maxim sty pin ny mo yale ges in a cont bit, Tu mer fit fu ot ped cane tinted yh one of iy free al ean pce. Te Seperate de eye mainom a pacino ech vat | Madman | Lead Product | (Satery | tateretay | tery) Bewyaay | 12 700 Fy pe cron | dates) | "Wola r | 30 "0600 3 |B 200 4 Fault i progam at alte rch he tree ade aang terse (pen nee eset po 1 Sappon con pol ees tha he ation af capcty ani schedules fnmiy) be amelie, Show howto noi you Poorer hs «6 Soper capany poly ie ha at et SO pecan fhe bars produced mat Yowohimgs ne maker arity af comput trge ders, whi ca sed to {womans thar we cl and BA ees aly Ave meron ed ‘of 0 machins wed proce the wo ule, whee tings for Ana have ome ‘orkatonin comm Le shar Bt oan ue mre) wets Been Yuin dosnt vy ave sfcleneapsy ome daman, ‘pec dng te peak Soman pro (the monn nea he sa the xa ea ‘Spe he tat conte ou pct ote of epee enon (yt enor mance eis tt tipped xt ne Yuan's te). Ts ex, Yovtigs hs derided tose a systema ae planning peso demine ‘rion nets an alongem prostion pan = te Fay A,B) podieia moat ~ 1, 28a mabecomet nt ae ing ” st iy pusher vendarin month a ssbieta mel end Frise gout inet of fay and mothe 4, Smtr fry cenandt (ml pe ding mots fy ows aaa om wrk eer) = 10) moat? 1 Thur rege at work emer / peri of aay "pei ts os) per wi of amy ened ase of i rode owe 1 lng cont ey one neil inlovernry om om mono the nes folate program ht minimize the ot hong pls vndaring pean) ‘pera tno yer (mo) sing horn of eign demand 0 ockowen se peed) You may acme hat enor apy orb ss Setinted ana hres venta fay on an othe begining othe sting horizon. 6 Wham te allowing factor might mst sets wo eam nthe gpeate ling nade ep fxm erie vending rate + Sequencing nd scheting + Alene sop oot onl mechanisms + Wendin nd operant ta comple pods + Allis stove «Sipe 00 ote ode npr and isp vending SO pect ofthe ‘emu aly A 30 pret of he dean or BVenorng 100 poet of © ‘tnd pre of Beaten, ure ina higher cst nthe mel. Cold {he 1b pnt rset 350 ln in pace? I, epi hy. {8.0 Protem of Red Inds at dion putin ttf Wo (ib wet topos hese preci tal sa (2) ow mach of exc proce Both Prous can te red on ingle michine an eae ee ano acne a ‘Inbar pages Howevr tresses polene Raed ex eae nos on ofeach bad of mucin. Ths, Per mut ao ede whic any, of ‘hemacie olen. The stn ran nd pod date ie below [ne| ‘octet |Mseeaee| nce |petrerss urs oProdce | Hours to Praface | Weekly Capacy | | Weely Lease + 05 2 ry 0900 oe 2 ry 00 06 os 0 5000 Product |" tunitvees) | (uni 8 109 nsom ni) Price Prae 4 Letig Ky eet ewe of wi ods odors pr Wek on mine j (Gererampe th moter of wit of & pent and | ache fermclc an Loman wes ot (cng sing on bet he ‘Sony and denn conn Otc the esigoerang ot fr porcalormactine snl here itt machine se nth cor or hy ent rfactinlvd Carly ene O-1 eget aeno repent roan set hs econ) aoe tierra cane any, Show How omy your Tomato ene at AttBalane protes oo noel of booker wie the levant dat re T ling re sis = Boteneck machine tine emia | 1 ont | 08 eit Pl = une eftokease | prc pr week 2 = we Yoke 2 red pe week RM = boa et fw material purchase per wk 12 dla per wok spn o advertising boakese2 ‘ach week p40 bor ot (Bf a mate i vals ost of SORE The Company cay four wrk, bn war 0 hows pr week forall ie bee “plvar 63 hu pes mek. Tey werk ede of prosacon oes othe alae Fer overtime work. Tre we 20 oun yr week rib onthe Donec mache. ‘wih vnc aden, SO os per wek a kee {6 nis per Wek of tookense ib demindd, Aversng cab da silt ean or ch ode Eeprence tows th eah da set on averng Dosteme | stesso for teskene 1 y lDumts whe ah dle on advising bck nce demand Fe bone 2y aie: Atm S100 pr werk on beset on alten “tn Leman nd sls fhe robe ore Row mic exch edit toyroues each wel ow cha el how much verte and he much adversng bya an elo, Ancver te allowing be tas ois ou 3) PRS Adee 60 3 oQmensme oe 8 we 100sa rath Prine Pre 2. Increasing he ight-hand sie of binding consular wilincease the objective ban amounr el tote shadow price bes hese ofthe ieeae, proves the te ina fale ton the allowable increas. 3 Decreasing theright hand side of binding cosa wil decreas the q ‘objective by an amount eqs! othe shadow rice ines he sie of he cree, povided tht he desrese smaller than he allowable decrease 4, Changes in therighthind sides beyond the allowable increase or decrease ‘ange have an dtr effect nd must be evaluated by reson the tmotied mode! Allthose sensviy reals aply to change in one right-hand side variable at ‘ime. Irmuitpe changes are ade, the elect are not neces aitve. every, otple-ariablevensvity nays must be done by resolving he ‘model under te mule changes 163, Product Mix Planning [Now tat we have setup the basic Framework for fornulating and solving agree Planaing probes, we cia examine sme commonly eicoutered situations. ‘Te fst Felis agregate planing sue we wil eonsderisthato product mix planing. To. this we need to extend the model ofthe previous set fo consider multiple products pli. As mentioned previously allowing mpl ree raises the possibilty of ‘Moning boitneck That, ithe diferent products eque diferent amounts oF procesing time on he varios woraatins, then the workstation tt is most heviy Tene daring peso may well depend on he mix of produto during that period It exbiy inte in is posible we ean oe the AP made to as he mix ‘aeconnce with avilable capacity. And ithe its exsentaly xed, we can we he [AP module to deny bouenecks 1634 Basie Model ‘We stut with diet extension ofthe previous single rd! model n which demands {rcassumed ed and the objectives to mnimine the enor eartyng cost of meeting these demands. Todo this, we inode the olin ation. fe an index of prodect i = 1... s0m reprisens ol umber of produ {j= an index of woraation, j= Uy--rm S07 represents ft numberof Sorts: index of prod ¢ = 1,780 epresens planning horizon j, = maximum demand or product n period + {Gi = minkmum sale allows of rodut in ped + fm time equired on workstation jo produce xe unit of product pocty of workstation J infer i uit consent wit hos wed 0 eine 4 1 het ro fom one ont of product 1 Cou told one unit of pret for one prod + Seem ce wi i en i sro to owen my antehye 16 Aga Me Ping se Xip = amount of prot produced in prid + ‘5, = amount of produc / sold in period ¢ 1, lavenory of product atend af period (Hs given a8 dt) Aztn. Xa, Suv and yar decison variables, wile the other symbol are constans represen pet data. We can give ner program oration ofthe problem to ‘aki rt profi minus inventory caring eos sbjet © upper ad lover bounds on files and capac constraints as Maximize OSS —haty 628) Subject 5808p Sorat 0629) Veykesen — foeaine (163) Is lnt Ka Sy foralie ass XSi le 20 foralline 632) fn comparison tothe previo single-product model, we have adjusted constraints (1629) o include lowe, wel a oper, bounds on ales. For instance. he frm may fave longterm contacts th obligte fo produce certin minum amount oferain product, Comey te mkt orsome products maybe limited. To maximize pro The computer has inentive st prodecion o that al hse consents wl be ight at ther uppet ints. However ths may ot be possible due to capacity consrans (16.30). [Notice that une inthe pevious formulation, we now have capacity corsa or tach workstation in each prod. By noting Which of hse conan ar tight, we can Senay tose rexouces thal limi prodocton. Comat (1631 are the multiproduct ‘erson ofthe tance equstions, and consis (1632) are he usual nnnegatvity ‘Wecan we LP (1628)-(16.2)t obtain several pecs of infomation, incading |. Demand feasibility, We can detrmine whether a set of demands is caput feasible. Ite consraint Sy dys tight then the pe bod on ‘Smad dy is en, 1 oot then is apaiyifease demands given by the lower bounds on demand, ae capacity infeasible, then the computer Program wil urns “could nd ind fesbe slain” message andthe user mat ake changes rede demands or increase capacity) in ode fo gta Felton 2, Mattleneck actions, Constraints (16.3) rest preduton on each swokstation nea eid. By nosing wbih ofthese consis are binding ‘nec determine which workstations iit capacity in which periods. A ‘rovksation hat sense nding a many pods is a clear botenech tnd requires lose management aerton. 3, Product mis I weate unable, for apecity reasons to arti al he upper ‘ours ands onthe sempatr wl edo sales blow ther maximum Frome pros Bw ty to maximie revenue by produing thee roc: ‘with high et prof, bt Beene ofthe capa coasts, hs 01 simple ater, we wil sn the following exampleChapter 16, Problem 1. @ max Str S.-M st ce d, <8, 54,Nit Iya hat X, 4%, ~SyNht ¥% SV, S,,¥it Xp Sylg Wy 2 OMI (Recs cnaninton Yh (©) Replace the constraints on Vs with Fv, s127,,vit ‘where 7; isa variable to be chosen by the LP (and is constrained to be nonnegative). (@) Models like these can help illuminate the impacts of diferent types of supplier contracts. Chapter 16, Problem 4. mK Ky ¢X yy +X AN +h Xe) +X Xa Xi) st Xs +X yn + Xyy $700 XytXq+Xq $900 Xt Xpq +X ps $450 DX #1TXg +14X, 10000 DN jy +17X g +14 py $7000 DN gy HTX, H1AX , £4200 Xp + Xp) Xp $550 Kyo +Xoo+X py $750 X yy +Xqy +X py S208 X, 2048 HSB j 123 (&) Replace the capacity constraints the last three constraints not counting nonnegativity) with the following (note that F represents the fraction of eapacity at each plant):Xt Not Xqj =SS0F Xyy +X + Xr2 = 750F Nyy t Xt Xpy 2225F osrsi (©) To ensure at least 50% heavy duty batteries, we want Xt Xyst Xun 20s Kt Xin Nyy + Xe +g hoy? XA RS ‘With a bit of algebra, we can conver this to the following linear constraint, which ean be added to the formulation of part (a). Mant Xz + Xs ~Xou~Xeq—Xo5 ~ Nig —Kig Hos BO ‘Chapter 16, Problem 6. (Let if welease machine j if wedonnot ‘The problem formulation: Max 150(X 4 +X q +g) +225 q+ Xn +X)=20000%, ~220007, ~18000%, Subject Kathy +X $200 Xun +X +X $100 05K 4 +12X, 580% 04N g H1.2K y <80%, 06K p +0.8K y <80Y, Ky Ky 2072123 ¥,€(01,/=123 () Simply add constraint ¥, + Y, <1.Lot 511 HEURISTICS ANP MAP CALCULUS 14. A single inventory item is ordered fom an outside supplies. The ancipated ‘emnand for this item over the next [2 moms 6, 12, 4,8, 15, 25,20, 5, 10,20, 5, 12, Current inventory ofthis tem i 4, and ending ‘avenory shoul be 8, Assume oiding eos of SI pee period anda setup cot of $40, Determine the over policy forthis item based on oe SiverNea 1. bento pap ang 4. Wich ltalaing meta rested inthe lowest costo 2 prog? 15: Forte coutexanple (sample 62), whieh show te Sve Mea hei Fo stn, des the sat east ore part ped ‘Sch heater ete pti! slr? 16: Diet be advange nd aang fe alli inng made ia \ Dec ook schefling pet roc EQ, iver Med, ea ut _ St and yap sans (7 eens semtyine ime | "Tests we are Wee 7 23 8 5 6 Requrements 335 200 1404403000 | “The setup cost forthe construction ofthe base assembly is $200, andthe hold ing ost is $030 per assembly per week. ‘a. What lt sizing do you obtain from the EOQ formula? 1 Determine the lot size using the ilve-Mealheuisi Determine the Jot sizes using the least unit east hearst. {2 Determine the lot ies using art period balancing Compare the holding and setup cose obtained ver esx periods usingthe poi ‘San found in pats (a) tough (2) with the eo of o-forot policy. Problems 18-22 are based onthe material appearing in Appendix 7-A. 18. Anticipated demands fora fourperiod planning horizon are 23,86, 40, and 12 ‘The sep cost a $300 and the holding costs ~ S3 per unt per pevog. | «a. Enumerate all ihe exet requirements poids, compute the holding sr setup ats foreach, and fn the optimal production plan | __b- Solve the problem by backward dyami preg atning Opt dens 2 esd ig an a 82038, Buren starting inventory ie four wits and the ivextry manager woul like to fave eis units on hand atthe ead ofthe planting horizon. Assume that f= { nd = 30 Fad the optimal production schedule, Hin: Modify the first and {he las period’ demands to account for staréng and ending inventories.) 2p, A small manufactring firm that produces a ine office furntre requires cas Jara ny constant rat of per weak. The MRF sytem assumes sc-work planing orien, Assume tht it cost 2660 setup for production of the casters End the holding cont mounts t SI per caster per week ‘a Compute the EOQ and determine the numberof periods of demand to which {hos eorespends by forming the rato (EOQ)/(Gemand per perio). Let Tbe282 Chapter Sven Pa Pal Pein Cont: MAP oT (his rato rounded to the nearest integer. Determine the poliy tat pos ceters once every T periods Using backward dynamic programming with N = 6 and r= 05,75, find the optinal solution. (Refer Io Appendix 7-A.) Does yur anor ‘with what you obtained in part (a)? Based on the resuls of Problem 20, suggest an approximate less nig. Under what circumstances would you expect his method ogre resus? Use thimethodto solve Example 7A.2(see Appendin 7-A), By what pes does the resulting solution fer rom te optimal? ye) Solve Problem 17 using the Wagner-Whitin algorithm. (Refer to Appendix 7-A) 7.3, INCORPORATING LOT-SIZING ALGORITHMS. INTO THE EXPLOSION CALCULUS Example 7.6 Latur tun to fnample 7. concsing the Harton Muse Company and conser te nah tt sitng on te exposon clive. Consde fit the ve cating asemy. een hated et tequtemants forthe ae cing exter ae we as 7 3: 0 No Tire phased ret equrements 42 a2 mos om ‘The setup cost or the ave casing ase $132, andthe kg cot sh = $050 tse per work We wl Sete he let sang by the Ser Meal ew ‘Staring in weet 4 a=, 2) = RA DSH _ 795, y= 24 9682+ 000) 132 + 062 + @N321 + OXI 5 or 2 132 + aster + 32) + x12) + RE os) 2 ‘nce C1) > C8). we terminate computations dd satya = 42 +42-+32-4 12 128 ‘Sarin nwo a= 132, IZ O6t112) gpg cy = BAD ae + odie +d 132 OatN12 + kes) + (aKa eli + (Nas) + (xN4) + 4X76) 9236,Additional Problems for Chapter 7 Adal ll fiCheer? 87 capacitated MRP problem, because even if paticlarlotsiing Schedules Feasibe at ‘ne level. thee no guarantee tha wil result na Feasible requirements sehedule at lower lve “Fal opimal lo sizing solutions for an MRP system would equi formulating the rob- ley ban ges progr in det determin the optinal decison feral levels simulta ‘oul Forel sembly sytem, which can bes manyas 101015 eels dep, this would ‘en tan enormous mathemati progremmingpobin.n view ofthehost of ter isus ‘Concemed wit implementing MRP the marge benef one might achieve ftom mutileve ‘Sptimzaton would probably aunty theft involve ‘Shen nersousness ise problem that sss when iplementing an MRP sytem. The term refers to he urantipated changes ia schedule atest when the planing bo tm vole forward by one prod, Another dieu i that in many cieunstanees, pro lion lead times depend on the lt sins: MRP sesres that production led times ae ‘sed Sil another problem tha the yields at various levels ofthe paces may ot be pe {eet ifthe yeld ates canbe aecuraely estimated in aban, these ates can be factored {mo the ealeuatios in straightforward munner. However, in many indstes the ye’ fates may be dial o estimate in aance ‘Manufactring eure planning (MRP I) tenia del wit ome ofthe problems oF implementing MRP by integrating the Brancil, accountng, and marketing funtion ino the podocton-plaming fonction. In ths chapter we alo ccs jst-nsine. ust nme fan inventory conto ystems whan pos! ist reduce wor in-process ou bare minima. The concepts are based onthe production cont! system sed Toyota in Jap intel 970s JT sapallysem, wheres AiR is puahystemPatsare tasted fomoneleve tothe next ony when eqs. ‘iiionoredocel inventories, thisappreahallows wosersto ikl locate quality cont! problems, Becuse ports are moved rough the ssten isa utes, efcs canbe iden- ‘hed quickly By the ature ofthe system, stopingpodetion at one letin automatically Sips provcton on the entries ta the source of he problem can be ened and cor reed before defective inventories buildup. “An important agpect of IT ie redution of production fot sizes. To make small ties economia itis necessary fo reduce fied cots of changeover. This isthe gol of single Iniute exchange of es (SED). By ving he ie-cr too-changing operation into par- ‘fons that can be doe of-ne and hose tha ust be dove oni, enormous eduction in ‘eto mes canbe achieved ‘Kanban and JT ar closely elt. Kanban is a mamal information system fr imple veming IT tht lie on ae ike signal the eed fr more produ. While not Try highec, the method he worked wel pacts. Sh has severe disadvantages vevis MRP as wll as several advantages JIT will react more quety sa problem develops. However, JT systems at very slaw to raet 10 ‘hnges in he ater of demand, MRP. on the other had buds freasts ie nto the explosion calls. ict produces tine of inexpensive pocket caleulators, One model, IT, sole ered sic model with igi ers spay (LCD). The cleltor is pie fared in Figure 7 Each calealtr requires four solar oxi, 40 butos, one LCD display, and one ran processor Alps ordered ftom ou ppies, Lt nal asenbly is done408 chapter Sen Seems MP aT FIGURE 7-11 comers {LESS nn toon C_avzeas -f tcoaney by Cate. The processor mst be in tock te weeks before the ante comple tin dat of ath of caleultors to allow erough ime ost the processor in ec ing. comect the appropriate wiring, and alow the Sting pate to dry. The buts ‘must be in stock two wee in afvance andare st by hand into the eaeuats Te UCD displays andthe soar ell ae ordered othe sue supplier and need ein Hock one week in advance, ‘Bosnd on rm ods shat Cathar abn he mater prction sche a 153 fre [Osek ped starting at week fs given by we 8 9 0 oN 2 Bb 6 oS 6m Nes 1200 1,200 800 1,000 1010 300 2.200 1400. 1800 60 Determine the gross requirements schedde forthe solar ell the buts, the LD, splay and the ain processor chip. Consider te example ofthe Call Company fr Problem 4. Suppose hat he batons ‘pedi thecalelator cor $002 each and Be company estimates a fed cost of 12 ‘or pacing and receiving odes of he btn rom an ouside suppl. Assume at holing costae based on a24 percent anual interstate ard that here are 48 weeks to year. Using the gross rquement schedule forthe batons deteined in Prob emt, what order policy deste Siver- el eur ecormend forthe buts? (Gin Expres at cost per 10,000 uns and vide each demand by 1,001) 143, Solve Problem 42 using pat period balancing and less uit east Compare the costs the vesting solutions to he eos ofthe souton obtained by sing he Siver-Mea heurit, 144 Norkcin-proces (WIP) inventory aterm ht refer to he invertry of components tnd subasembes ina manoTatrng proces. Assuming fo ferot chedling at all45 lev theoretically the WIP inentony should be eo. Do you think th this key to ‘inc ureine rel manufacrngemoronment? Discuss the possible reasons forage WiP nvemories caring even when an MRP system sued Vivian Lowes planning a sarrte party for her haeand’ SO birthday. Se has de ‘ed to serve ssh kabob, The rete that she i using cals or vo pinespoe chunks foreach srimp. She plans sie the kabobs so that exch has thee simp. She et ‘tes tata singe pioeppl will yield abou SO chunk, but from past experince {ont Fou of every 10 pnesppes is bad and as tobe thrown ou. She has invited 200 people and expects that gout half wil how up. Each person generally eat about 2 Kabobs 4 How any pineapples should se boy? ‘Suppose that the number of gues i «random variable having the norma =0, Yor tas Hs + f6= MO, Yo=O and Yo=O. [Note that ths is the same solution obtained by the Silver-Medl heuristic. a1. Gross requirement schedule for each ofthe componenis: (wax Ts] s]7]s[o [wo pe es ee IMs Tas 1200] cof Too, 100100] 2200] 1400{ 73000) [coos a Tao] 20] 00] Too] Too] soo] 2500] ra0o ran a0 calls -gvof 8003200] 400} 200012001 so] S00] 7aolz=m] slay ‘2 1300|—s00| tooo} 1000] s00|2200| 1200100) eno Instone {zn zs000 2000000 zaxcor2000|s8000son0 2000400) 2. K=1200 n= (0.24}(0.02y48 = 0.0001 Gross requirements are given by last line of solution to problem 41. For convenience, we multiply h by 10,000 and divide each demand by 10,000. Hence, = 1 and (48,48, 32,40, 40, 12, 88,5.6,7.2,24) Star in period 1 Cay=i2 CQ)=(12+48)2 =84 C3) = 12)G.4) + 2VG.2Y3 = 7.733 (4) = (B)0.738) + NAN respect to its previous value). Stop (since the averege cost per period increased with, yentntn= 128 Cy=i2C2)= (12+ 42=8 CG) = (208) + Q)U.2Y3 = 6.133 Cla) =1GH0.135) + GHBBIE= 2 Sto. waretrst t= 9.2 = [2Y88)+2)(7.2)13 = 10.67 Stop. 44 Finally, we will obtain yy=1y+119= 9.6 Hence, order policy recommended by Silver-Meal is (128,000; 0; 0; 92,000; 0; 0; 144,000; 0; 96,000, 0) ‘The cost of this solution is: (4)(12) +B +32 +524 1.2+56+24) =$7360 48. ‘According to the product structure, we find the item level for each component: ‘Level 0: EPI, EP2 Level I: A,B,C,D,E Level 2:F Level 3:G,H ‘The following table shows the material requirement for components that use F, G and H. Since in this case, the intial inventories andthe Scheduled receipts are equal to zero, and the applied Tot-siing policy i lot-for-ot, forall tems, we skip all the intermediate steps and provide only the grossed requirements for each item and the planned order releases.FE si] rs] FES) S| Fl Fl is] Feiss) zee Efe