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Aggregate production planning…. .?  Medium-term capacity planning over a two to eighteen month planning horizon.  It involves determining the lowest-cost method of providing the adjustable capacity for meeting production requirements.

Aggregation is done according to:  Products  Labor  Time Slide 11. rather than individual products or services.Aggregation refers to the idea of focusing on overall capacity.3 .

Different from manufacturing…???  Services do not involve stockpiles or inventory  Service-focused businesses do not have the luxury of building up their inventories during periods of low demand  In aggregate planning.” where any capacity that is unused is considered to be wasted For ex: Hotel room or an empty flight seat . services are considered “perishable.

It can be used across a wide range of industries. . It is used for all production-planning processes. Aggregate planning has its advantages and disadvantages. it develops a road map to operate efficiently. and is also flexible.Why? Aggregate planning was developed to tackle the problem of meeting forecasted demand by adjusting production capacity.

You don't have to monitor inventory levels. you may not be used to thinking in terms of output. Learn about annualized hours and productivity planning. However. Aggregate planning seeks to forecast mid-term (six to 18 months) demand and output capacity for a company  If your small business is a service company. and your employees don't produce a product. otherwise known as aggregate planning for service businesses Why? ? . you can still develop an aggregate plan to best utilize employee hours and maintain quality service for your customers through times of rising and falling demand.

output.7 . and inventory levels (2-18 months)  Short Range Planning  Job scheduling. machine loading. and job sequencing (0-2 months) Slide 11.Production Planning  Long Range Planning  Strategic planning (1-5 years)  Medium Range Planning  Employment.

customer service Slide 11. use of subcontracting. changes in work force levels. changes in production rates and plant/personnel idle time MAXIMIZE: Profits.8 ...Common objectives of production planning. use of overtime. inventory levels. MINIMIZE: Cost.

hotel room reservations or advertising inventory) .Yield management  The application of pricing strategy to allocate capacity among various categories of demand  Yield management is the process of understanding. perishable resource (such as airline seats . anticipating and influencing consumer behavior in order to maximize yield or profits from a fixed.

room type.So what does that definition actually mean?  Selling the right product  Correct brand. and/or meeting space  To the right customer  Transient or Group/Business or Pleasure  At the right time  The booking window of how far out guests book  For the right price  Properly position rates for each segment .