Define aggregate planning and its strategies to meet demand supply

Aggregate Planning in Supply Chain Management |

define aggregate planning and its strategies to meet demand supply

By ordering for the entire planning period, you can qualify for bulk discounts and. This approach gives you a comprehensive view of the supplies you'll need to meet the demand for your Management Study Guide: What is Aggregate Planning?- Importance and Its Strategies · San Francisco State University: Aggregate. Passive/ reactive Strategies in Aggregate Planning: Basic Approaches Definition The term Aggregate Planning is defined as, “An operational The chase method helps the firms to match production and demand by hiring Aggregate production planning is thus, a vital tool to aid firms in balancing supply and demand. Aggregate planning is quite complicated with variable demand and/or supply. The In aggregate planning, an organization attempts to satisfy demand by manipulation of the size and Consolidate the gross requirements (total demand ).

Factors Affecting Aggregate Planning Aggregate planning is an operational activity critical to the organization as it looks to balance long-term strategic planning with short term production success.

Aggregate Planning - Production and Operations Management | Ahel Vitsu -

Following factors are critical before an aggregate planning process can actually start; A complete information is required about available production facility and raw materials. A solid demand forecast covering the medium-range period Financial planning surrounding the production cost which includes raw material, labor, inventory planning, etc.

Organization policy around labor management, quality management, etc. For aggregate planning to be a success, following inputs are required; An aggregate demand forecast for the relevant period Evaluation of all the available means to manage capacity planning like sub-contracting, outsourcing, etc. Existing operational status of workforce number, skill set, etc.

Aggregate Planning - strategy, organization, levels, system, examples, model, type, company, system

Aggregate planning as an Operational Tool Aggregate planning helps achieve balance between operation goal, financial goal and overall strategic objective of the organization.

It serves as a platform to manage capacity and demand planning. In a scenario where demand is not matching the capacity, an organization can try to balance both by pricing, promotion, order management and new demand creation.

In scenario where capacity is not matching demand, an organization can try to balance the both by various alternatives such as. Including overtime as part of scheduling there by creating additional capacity. Hiring a temporary workforce for a fix period or outsourcing activity to a sub-contrator. Importance of Aggregate Planning Aggregate planning plays an important part in achieving long-term objectives of the organization.

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Capacity availability can be difficult to predict. In services, the types of variety of task are more pervasive than compare with manufacturer and this makes it difficult to establish measures of capacity. Disaggregating the aggregate plan- this means breaking down the aggregate plan into specific product requirements in order to determine labor requirement skills, size, or workforcematerials, and inventory requirements.

Master schedule- the result of disaggregating the aggregate plan is master schedule showing the quantity and timing of specific end items for a scheduled horizon that covers about six to eight weeks ahead.

Rough-cut capacity planning-this involves testing the feasibility of a proposed master schedule relative to available capacities, to assure that no obvious capacity constraints exist.

It means checking capacities of production and warehouse facilities, labor, and vendors to ensure that no gross deficiencies exist that will render the master schedule unworkable.

define aggregate planning and its strategies to meet demand supply

ATP or Available to Promise inventory- the master schedule process uses this information on a period-by-period basis to determine the projected inventory, production requirements and the resulting uncommitted inventory. Why is it important to stabilize the master schedule?

define aggregate planning and its strategies to meet demand supply

Master schedule enables marketing to make valid delivery, enables production to evaluate capacity requirements, and provides necessary information for production, marketing and senior management with opportunity to determine whether the business plan and its strategic objectives will be achieved. How are master schedules stabilized?

What is Aggregate Planning ? - Importance and its Strategies

By the master scheduling process which involves the input and outputs. The duties of the master scheduler generally include: Providing delivery dates for orders.

Aggregate Planning

Bringing instances of insufficient capacity to the attention of production and marketing personnel so that they can participate in resolving conflicts. List the inputs and outputs of master scheduling: Inputs- the beginning inventories, which is actual quantity on hand from the preceding period; the forecasts for each period of the schedule; and the customer orders, which are quantities already committed to customers.

Outputs- Projected inventory, master production schedule and uncommitted inventory.

define aggregate planning and its strategies to meet demand supply

What are time fences?