Aggregate
Planning
In Supply Chain
Prepared For
Demo Lecture in BUFT
Prepared By
Outline
What is Aggregate Planning?
Role of Aggregate Planning
in Supply Chain
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Information Need for
Aggregate Plan
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Output of Aggregate Plan
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Strategy for Aggregate planning
Chase Strategy
• T h e p ro d u c t i o n ra te i s
sy n c h ro n i ze d w i t h d e m a n d
rate .
• Va r y m a c h i n e c a p a c i t y o r
h i re a n d l ayo ff wo r ke rs a s
d e m a n d va r y
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Often difficult to vary capacity
and workforce on short notice.
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Expensive if cost of varying
capacity is high.
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Negative effect on workforce
morale.
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R e s u l t i n l o w l e v e l o f i n v e n t o r y.
Time flexibility
strategy
• Wo r k fo rc e sta b l e
• N u m b e r o f h o u r wo r ke d
va r i e s
• U s e o ve r t i m e o r a f l ex i b l e
wo r k s c h e d u l e .
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Flexible workforce avoids
morale problem.
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Low level of inventories.
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Lower utilization.
Level strategy
• S ta b l e M a c h i n e c a p a c i t y
a n d wo r k fo rc e l e ve l .
• C o n sta nt O u t p u t rate .
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Inventory level fluctuate (High
inventory when low demand)
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Better for workforce morale
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Large inventories
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Customer order may be delayed
in peak demand period.