P370- Aggregate Production Planning

Master Production Scheduling

1st level of disaggregation, break-down into more real end-items, horizon and buckets are no larger than APP (often shorter)

Aggregate Production Planning (APP)

A managerial statement of time-phased production rates, work-force levels, and inventory investment, which takes into account customer requirements (demand) and capacity limitations. Helps us attain our goals.

Nature of APP

Aggregate, time horizon- medium, time buckets- divisions of horizons, rolling horizon, nature of business determines (typically one year with one month buckets)

Three Pure Aggregate Plans

Chase, level, stable workforce

Aggregate

Classes of products, labor or other inputs, geographic location of production, often fictitious (exists only in plan)

Level

Constant workforce/production level with fluctuating inventory levels. Everyone knows # of hours they are working. Lots of waste.

Shop Floor Scheduling

Detailed, actual production schedule

Forecast

Drives the aggregate production plan. The APP is designed to meet this

Planning Horizon

Entire length of a plan

Material Requirements Planning

Extreme detail, down to each nut and bolt

Major Operations Planning Activities

LONG RANGE: Process planning ---> strategic capacity planning --> MEDIUM RANGE: Forecasting and demand management --> Sales and operations (aggregate planning): sales plan/aggregate operations plant --> manufacturing (master scheduling-->material requirements planning --> SHORT RANGE: order scheduling) and services (SHORT RANGE: weekly workforce and customer scheduling---> daily workforce and customer scheduling).

Bill of Materials (BOM)

List of things needed for a project

Lower levels of planning

Master Production Scheduling (MPS), Material Requirements Planning (MRP), Shop Floor Scheudling

Chase

Production and manpower fluctuate together- mimic each other. Reduce wastes, lots of hiring and firing

Sales Inventory Operations Planning (SIOP)

Requires sales plan and aggregate operations plan to work together

Stable Workforce

Size of workforce is constant, but number of hours worked fluctuates. Lots of overtime. The change in the # of hours worked is not indicative of a change in the # of workers.

Buckets

Slivers of time on the planning horizon

Rolling horizon

always have six months of planning in front