Concept explainers
a.
To determine:
Aggregate measure of production and difficulty for planning the size of faculty in a university.
Introduction:
Aggregate capacity planning is a process in which resources and inventory of future demand is determined. It helps in maintaining overall quality and features of product. It leads to effective management and cost efficiency of product.
a.
Explanation of Solution
Planning for the size of the faculty in a university
To increase the size of the faculty, various constraints will be taken care. Constraints can be cost, salary, revenue, expenditure of recruitment, Human Resource Management etc. These constraints needs to be assessed before increasing the size of faculty.
A major problem in applying aggregate planning for expansion of faculty in a university is resource allocation. Every university has limited resources at their disposal. A university can gather its resources from tuition fee, gifts in form of cash or kind, research grants etc. Expenditure includes salaries of faculty, building maintenance, capital goods etc. In a university, there are various departments and sub-departments. These departments get their share of budget and resource are allocated accordingly.
For example, school would allocate funds to the individual departments and the department would allocate funds to the faculty and staff in the department.
b.
To determine:
Aggregate measure of production and difficulty in determining workforce requirements for a travel agency.
Introduction:
Aggregate capacity planning is a process in which resources and inventory of future demand is determined. It helps in maintaining overall quality and features of product. It leads to effective management and cost efficiency of product.
b.
Explanation of Solution
Retaining workforce in a firm is a big challenge for companies and they are striving hard to discover new Human resource strategies and workforce requirements for a travel agency. Some of them are listed below:
Incentives: Travel agencies should consider revising monetary incentives for employees. The purpose is to encourage and retain employees for a longer period.
Improving communication between the lower and middle level managers: Employees should come forward and clarify their concern regarding their respective job responsibilities and maintain clear communication among them. It therefore eliminates any form of ambiguity between the employees.
Training: A travel agency must have trained people as drivers. So, in order to employ, training must be given and a driving test is a prerequisite. It helps the employees to be updated with industry specific knowledge.
These are some of the elements that the firm aggregates in total in determining the workforce requirements for a travel agency.
The difficulties in applying aggregate planning are explained below:
Companies often lag in identifying the needs of the employees and ends up observing a large employee turnover. Besides that, a travel agency often pays small remunerations and sets huge targets for their employees to achieve company goals. It harms the reputation of the firm adversely.
Also, there is a huge communication gap between the management and the staff that dissuades employees to clarify their concerns.
c.
To determine:
Aggregate measure of production and difficulty in planning workforce and production levels in a fish - processing plant.
Introduction:
Aggregate capacity planning is a process in which resources and inventory of future demand is determined. It helps in maintaining overall quality and features of product. It leads to effective management and cost efficiency of product.
c.
Explanation of Solution
Aggregate measure of production and difficulty in planning workforce and production levels in a fish processing plant that produces canned sardines, kippers and smoked oysters.
Aggregate capacity planning is a process in which resources and inventory of future demand is determined. It helps in maintaining overall quality and features of product. It leads to effective management and cost efficiency of product.
The following is a list of aggregate measures that can be considered for planning workforce and production levels in a fish processing plant.
Number of fishes: The planning and production department needs to ensure that they have sufficient units of fish to be sold to large groups of customers. Besides that, the respective department needs to search for suitable vendors that would supply the fish to the manufacturers and the distributors.
Markets: Another major point is to search for relevant market such as suitable locations or regions. The firm needs to ensure where to sell products and from where they can earn maximum revenues or find suitable market segments.
Number of skilled workers: Skilled and trained workforce is a major challenge for firms to start up new projects or in this case, production levels in a fish processing plant.
The difficulties in applying aggregate planning are explained below:
Transportation issues: It is often seen that due to climatic conditions or vehicular accident, the units of fish are damaged in transit. It affects the company’s earning and business in a huge way.
Waste disposal centers: The production department often faces difficulties in locating waste disposal centers due to which it gives rise to health issues.
Improper production planning: At time, firms are unable to
Hence, if aggregate measures such as transportation, waste disposal centers, production planning, markets, target audience are not properly considered, it leads to disaggregation of planning.
Want to see more full solutions like this?
Chapter 3 Solutions
Production and Operations Analysis, Seventh Edition
- Planners for a company that makes several models of skateboards are about to prepare the aggregate plan that will cover six periods. They have assembled the following information. Period 1 2 3 4 5 6 Total Forecast 200 200 300 400 500 200 1,800 Costs Output Regular time=$2 per skateboard Overtime =$3 per skateboard Subcontract =$6 per skateboard Inventory =$1 per skateboard per period on average inventory Back orders =$5 per skateboard per period They now want to evaluate a plan that calls for a steady rate of regular-time output, mainly using inventory to absorb the uneven demand but allowing some backlog. Prepare an aggregate plan and determine its cost using the preceding information.arrow_forwardA. When aggregate planning seeks to influence demand and supply, both the marketing and operations functions are involved. In this case, the goal is generally to find: a. A lower total cost plan b. A higher profit plan c. A higher sales revenue plan d. A lower cost of goods manufactured plan B. In a market situation where demand is exceeding supply, which from the following list would you generally work on first? a. Distribution b. Work force level c. Promotion d. Pricearrow_forwardPlanners for a company that makes several models of skateboards are about toprepare the aggregate plan that will cover six periods. They now want toevaluate a plan that calls for a steady rate of regular output, mainly usinginventory to absorb the uneven demand but allowing some backlog. Overtimeand subcontracting are not used because they want a steady output. They intendto start with zero inventory on hand in the first period. Prepare an aggregate planand determine its cost using the following information. Assume a level of outputrate of 300 units per period with regular time. Note that the planned endinginventory is zero. There are 15 workers, and each can produce 20 units per Period 1 2 3 4 5 6 Total Forecast 200 200 300 400 500 200 1800 Cost Information:Regular time = $2 per skateboardOvertime = $3 per skateboardSubcontract = $6 per skateboardInventory = $1 per skateboard per period on average inventoryBack orders = $5 per skateboard per periodarrow_forward
- NowJuice, Inc. produces bottled pickle juice. A planner has developed an aggregate forecast for demand (in cases) for the next four months. Use the following information to develop an aggregate plan using the LEVEL strategy. Inventory holding cost is $1 per month per case and backlog cost is $5 per month per case. Beginning inventory is zero. Month May June July August Forecast 452 520 600 719 Cost Per Unit Monthly Capacity Regular Production 19.40 400 Overtime Production 1.5 x Regular Prod Cost 400 What is the TOTAL cost of the LEVEL plan over the planning horizon? Correct Answer 51,588.6 CAN SOMEONE SHOW ME HOW THEY GOT THE ANSWER 51588.6arrow_forwardA local machine shop employs 60 workers who have a variety of skills. The shopaccepts one-time orders and also maintains a number of regular clients. Discuss someof the difficulties with using the aggregate planning methodology in this context.arrow_forwardWhich of the following is not one of the graphical methodsteps?a) Determine the demand in each period.b) Determine capacity for regular time, overtime, andsubcontracting each period.c) Find labor costs, hiring and layoff costs, and inventoryholding costs.d) Construct the transportation table.e) Consider company policy that may apply to the workers or stock levels.f ) Develop alternative plans and examine their total costs.arrow_forward
- Deb Bishop Health and Beauty Products has developed a new shampoo and you need to develop its aggregate schedule. The cost accounting department has supplied you the cost relevant to the aggregate plan and the marketing department has provided a four-quarter forecast. the four-quarter forecast. Quarter Forecast 1 1,400 2 1,100 3 1,700 4 1,300 the costs relevant to the aggregate plan. Costs Previous quarter's output 1,600 units Beginning inventory 0 units Stockout cost for backorders $55 per unit Inventory holding cost $11 per unit for every unit held at the end of the quarter Hiring workers $50 per unit Layoff workers $75 per unit Unit cost $35 per unit Overtime $20 extra per unit Subcontracting Not available Your job is to develop an aggregate plan for the next four quarters. Part 2 a) Try hiring and layoffs (to meet the forecast) as necessary…arrow_forwardIn aggregate planning models which of the following statements are correct A. The number of workers available influence the possible production level. B. We allow the work level to be modified each month. C Demand should be met D. All of the abovearrow_forwardA manager is attempting to put together an aggregate production plan for the coming nine months. She has obtained forecasts of aggregate demand for the planning horizon. The plan must deal with highly seasonal demand; demand is relatively high in months 3 and 4, and again in month 8, as can be seen below: The company has 20 permanent employees, each of whom can produce 10 units of output per month at a cost of $6 per unit. Inventory holding cost is $5 per unit per month, and back-order cost is $10 per unit per month. The manager is considering a plan that would involve hiring two people to start working in month 1, one on a temporary basis who would work until the end of month 5. The hiring of these two would cost $500. Beginning inventory is 0.Start with 20 permanent workers. Prepare a minimum cost plan that may use some combination of hiring ($250 per worker), subcontracting ($8 per unit, maximum of 20 units per month, must use for at least three consecutive months), and overtime…arrow_forward
- Deb Bishop Health and Beauty Products has developeda new shampoo, and you need to develop its aggregate schedule.The cost accounting department bas supplied you the costsrelevant to the aggregate plan, and the marketing department hasprovided a four-quarter forecast. All are shown as follows: Your job is to develop an aggregate plan for the next four quarters.a) First, try hiring and layoffs (to meet the forecast) as necessary.b) Then try a plan that holds employment steady.c) Which is the more economical plan for Deb Bishop Healthand Beauty Products?arrow_forwardA Pizza Company has a demand forecast for the next 12 months that is shown in Table 1 The current workforce of 100 staff can produce 1500 cases of pizzas per month. (a) Prepare a production plan that keeps the output level. How much warehouse space would the company need for this plan? (b) Prepare a demand chase plan. What implications would this have for staffing levels, assuming that the maximum amount of overtime would result in production levels of only 10 per cent greater than normal working hours? Table 1 demand forecast Month Demand (cases per month) January 600 February 800 March 1000 April 1500 May 2000 June 1700 July…arrow_forwardmanager has prepared a forecast of expected aggregate demand for the next six months. Develop an aggregate plan to meet this demand given this additional information: A level production rate of 1000 units per month can be used. Backorders are allowed, and they are charged at the rate of $8 per unit per month. Inventory holding costs are $1 per unit per month based on maximum inventory. Determine the cost of this plan if regular time cost is $20 per unit, beginning inventory is zero, and initial backlog from previous plan is 100. Month Forecast 1 800 2 100 3 1200 4 1100 5 1000 6 900 a. Prepare an aggregate plan.b. Prepare an aggregate plan if the management decided to switch to chase…arrow_forward
- Practical Management ScienceOperations ManagementISBN:9781337406659Author:WINSTON, Wayne L.Publisher:Cengage,Operations ManagementOperations ManagementISBN:9781259667473Author:William J StevensonPublisher:McGraw-Hill EducationOperations and Supply Chain Management (Mcgraw-hi...Operations ManagementISBN:9781259666100Author:F. Robert Jacobs, Richard B ChasePublisher:McGraw-Hill Education
- Purchasing and Supply Chain ManagementOperations ManagementISBN:9781285869681Author:Robert M. Monczka, Robert B. Handfield, Larry C. Giunipero, James L. PattersonPublisher:Cengage LearningProduction and Operations Analysis, Seventh Editi...Operations ManagementISBN:9781478623069Author:Steven Nahmias, Tava Lennon OlsenPublisher:Waveland Press, Inc.