Aggregate Planning, MRP, and
Short Term Scheduling
Introduction
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What – Determine the quantity and
timing of production for the immediate
future
Where – To meet forecasted demand
Why – Minimize costs
The Planning Process
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Aggregate planning ties strategic goals
to production plans
Medium range – 3 to 18 months
Requires:
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Measure of sales and output
Forecast of demand for the period
Method of determining costs
Model that combines forecasts and costs
Aggregate Plan Relationships
Marketing
Customer
Demand
Production
Capacity
Inventory
Procurement
Supplier
Performance
Finance
Cash Flow
Aggregate
Production Plan
Management
Return on
Investment
Capital
Engineering
Design
Completion
Human
Resources
Manpower
Planning
Capacity Options
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Change inventory levels
Change workforce size
Change production rates
Subcontracting
Using Part-Time Workers
Demand Options
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Influence demand
Back order during high demand periods
Counterseasonal product mix
Strategies
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Chase strategy
Level strategy
Mixed strategy
Aggregate Planning Problems
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The Transportation Model of linear
programming is a form of Aggregate
Planning
Compare different strategies
Tabulate costs of the plan over a period
of time