Professional Documents
Culture Documents
Operations Management
William J. Stevenson
8th edition
12-2 Aggregate Planning
CHAPTER
12
Aggregate Planning
Planning Horizon
Intermediate
range
Short
range
Long-range plans
Long term capacity
Location / layout
12-5 Aggregate Planning
Planning Sequence
Figure 12.1
Economic,
Corporate competitive, Aggregate
strategies and political demand
and policies conditions forecasts
Establishes operations
Business Plan
and capacity strategies
Establishes
Aggregate plan
operations capacity
Resources Costs
Workforce Inventory carrying
Facilities Back orders
Policies Overtime
Inventory changes
Subcontracting
Overtime subcontracting
Inventory levels
Back orders
12-7 Aggregate Planning
Employment
Subcontracting
Backordering
12-8 Aggregate Planning
Proactive
Alter demand to match capacity
Reactive
Alter capacity to match demand
Mixed
Some of each
12-9 Aggregate Planning
Demand Options
Pricing
Promotion
Back orders
New demand
12-10 Aggregate Planning
Capacity Options
Part-time workers
Inventories
Subcontracting
12-11 Aggregate Planning
Basic Strategies
Chase Approach
Advantages
Investment in inventory is low
Labor utilization in high
Disadvantages
The cost of adjusting output rates and/or
workforce levels
12-14 Aggregate Planning
Level Approach
Advantages
Stable output rates and workforce
Disadvantages
Greater inventory costs
Increased overtime and idle time
Resource utilizations vary over time
12-15 Aggregate Planning
Cumulative Graph
Figure 12.3
Cumulative output/demand
Cumulative
production
Cumulative
demand
1 2 3 4 5 6 7 8 9 10
12-17 Aggregate Planning
Average Inventory
Mathematical Techniques
Aggregate
Planning
Disaggregation
Master
Schedule
12-22 Aggregate Planning
Master Scheduling
Master schedule
Determines quantities needed to meet demand
Interfaces with
Marketing
Capacity planning
Production planning
Distribution planning
12-24 Aggregate Planning
Master Scheduler
Insufficient capacity
12-25 Aggregate Planning
Inputs Outputs
Beginning inventory Projected inventory
Master
Forecast Master production schedule
Scheduling
Period
1 2 3 4 5 6 7 8 9
Flexibility Models
LP4
Caterpillar
12-31 Aggregate Planning
Production Process/Steps
PT2
Federal Signal