Production and Operations Analysis, Seventh Edition
7th Edition
ISBN: 9781478623069
Author: Steven Nahmias, Tava Lennon Olsen
Publisher: Waveland Press, Inc.
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Chapter 3.4, Problem 23P
Summary Introduction
To think critically about: Suitable application of a chase and level strategy.
Introduction: Chase strategies are also referred to as the zero inventory plan; this focuses on a constant change each month, the workforce is adjusted regularly to match the demand. Level strategies are also referred to as the constant workforce plan, the capacity is uniform and instead the inventory is kept between the periods.
Aggregate planning allows organizations to plan ahead. Aggregate planning’s objective is to manage the positives of producing to meet their demand within close proximities whilst tackling interferences caused by changes in production levels and the change in workforce levels.
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Is a chase or level strategy more appropriate for aggregate planning in an air conditioning manufacturing plant where demand is highly seasonal and the workforce is relatively skilled? Explain your answer.
Is a chase or level strategy more appropriate for aggregate planning in an air conditioning manufacturing plant where demand is highly seasonal and the workforceis relatively skilled? Explain your answer.
Identify the variables decision makers have to work with in aggregate planning.
Chapter 3 Solutions
Production and Operations Analysis, Seventh Edition
Ch. 3.1 - Prob. 1PCh. 3.1 - Prob. 2PCh. 3.1 - Prob. 3PCh. 3.1 - Prob. 4PCh. 3.1 - Prob. 5PCh. 3.1 - Prob. 6PCh. 3.2 - Prob. 7PCh. 3.2 - Prob. 8PCh. 3.2 - Prob. 9PCh. 3.2 - Prob. 10P
Ch. 3.2 - Prob. 11PCh. 3.2 - Prob. 12PCh. 3.3 - Prob. 13PCh. 3.3 - Prob. 14PCh. 3.3 - Prob. 15PCh. 3.3 - Prob. 16PCh. 3.4 - Prob. 17PCh. 3.4 - Prob. 18PCh. 3.4 - Prob. 19PCh. 3.4 - Prob. 20PCh. 3.4 - Prob. 21PCh. 3.4 - Prob. 22PCh. 3.4 - Prob. 23PCh. 3.5 - Prob. 26PCh. 3.5 - Prob. 27PCh. 3.6 - Prob. 29PCh. 3.6 - Prob. 30PCh. 3 - Prob. 31APCh. 3 - Prob. 32APCh. 3 - Prob. 33APCh. 3 - Prob. 34APCh. 3 - Prob. 35APCh. 3 - Prob. 36AP
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Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, operations-management and related others by exploring similar questions and additional content below.Similar questions
- A barbershop has been using a level workforce of barbers five days per week, Tuesday through Saturday. The barbers have considerable idle time on Tuesday through Friday, with certain peak periods during the lunch hours and after 4 p.m. each day. On Friday afternoon and all day Saturday, all the barbers are very busy, with customers waiting a substantial amount of time and some customers being turned away. What options should this barbershop consider for aggregate planning? How would you analyze these options? What data should be collected, and how should the options be compared? You do not have to address all questions. Please select one or two to discuss.arrow_forwardPlanners 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_forwardWhy is Aggregate Planning important in the service sector? Take the example of Airline industry to explain your answer.arrow_forward
- Aggregate planning is concerned with determining thequantity and timing of production in the:a) short term.b) intermediate term.c) long term.d) all of the above.arrow_forwardA barbershop has been using a level workforce of barbers five days per week, Tuesday through Saturday. The barbers have considerable idle time on Tuesday through Friday, with certain peak periods during the lunch hours and after 4 p.m. each day. On Friday afternoon and all day Saturday, all the barbers are very busy, with customers waiting a substantial amount of time and some customers being turned away. What options should this barbershop consider for aggregate planning? Howwould you analyze these options? What data should be collected, and how should the options be compared?arrow_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_forward
- Why are graphical aggregate planning methods useful?arrow_forwardHow does aggregate planning in service differ fromaggregate planning in manufacturing?arrow_forwardConsuelo Chua, Inc., is a Columbian disk drive manufacturer in need of an aggregate plan for July through December. The company has gathered the following data given in the tables. There are 8 hours of production per day. You manage a consulting firm down the street from Consuelo Chua, Inc., and to get your foot in the door, you have told Ms. Chua that you can do a better job at aggregate planning than her current staff. She said, "Fine. You do that, and you have a 1-year contract." To make good on your boast, you propose a new strategy. Hire 5 workers in August and 5 more in October, and subcontract to meet the rest of the demand. What will be the cost of this strategy? Other data Current workforce (June) Labor-hours/disk drive Workdays/month Beginning Inventory Ending Inventory *Note that there is no holding cost for June. 8 people 4 hours 20 days 150 disk drives* O disk drives Fill in the table below. (Enter all responses as whole numbers. In the hire/fire column, use positive…arrow_forward
- Describe the difference between aggregate planning in service and aggregate planning in manufacturing ?arrow_forwardManufacturing Aggregate Planning. Manufacturers Inc. (MI) currently has a labor force of 10, which can produce 500 units per period. The cost of labor is now $2,400 per period, per employee. The company has a long-standing rule that does not allow overtime. In addition, the product cannot be subcontracted due to the specialized machinery that MI Uses to produce it. As a result, MI can only increase/decrease production by hiring or laying off employees. The cost is $5,000 to hire an employee and $5,000 to lay off an employee. Inventory-carrying costs are $100 per unit remaining at the end of each period. The inventory level at the beginning of period 1 is 300 units. The forecast demand in each of 3 periods is given in the table below. Aggregate Demand Period 1 = 730 Period 2 = 620 Period 3 = 420 a) Compute the costs of the chase strategy. b) Compute the costs for a level strategy. c) Compare the two strategiesarrow_forwardManufacturing Aggregate Planning. Manufacturers Inc. (MI) currently has a labor force of 10, which can produce 500 units per period. The cost of labor is now $2,400 per period, per employee. The company has a long-standing rule that does not allow overtime. In addition, the product cannot be subcontracted due to the specialized machinery that MI Uses to produce it. As a result, MI can only increase/decrease production by hiring or laying off employees. The cost is $5,000 to hire an employee and $5,000 to lay off an employee. Inventory-carrying costs are $100 per unit remaining at the end of each period. The inventory level at the beginning of period 1 is 300 units. The forecast demand in each of 3 periods is given in the table below. Aggregate Demand Period 1 = 730 Period 2 = 620 Period 3 = 510 Period 4 = 420 a) Compute the costs of the chase strategy. b) Compute the costs for a level strategy. c) Compare the two strategiesarrow_forward
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