Exam 12: Aggregate Planning and Sop

Which of the following characteristics makes revenue management UNATTRACTIVE to organizations that have perishable inventory?

A large consulting firm is deciding if its workforce should be expanded, maintained, or decreased. Suppose that demand is given in week-long projects, and that a consultant can work on 3 projects each month (1 week off for personal leave and/or other duties such as conferences, etc). Currently there are 25 consultants. Ten consultants are trained for LEAN and 15 for Six Sigma, with 5 of those consultants being overlaps (the consultant is trained for BOTH LEAN and Six Sigma). Assume that all consultants can do the general work. Complete the table (the forecast period is an upcoming month) and prepare a recommendation.

Disaggregation is the process of breaking the aggregate plan into greater detail; one example of this detail is the master production schedule.

Which of the following is NOT an input to S&OP?

What four things are needed to develop an aggregate plan?

Which choice below best describes the counterseasonal product demand option?

Reddick's Specialty Electronics makes weatherproof surveillance systems for parking lots. Demand estimates for the next four quarters are 25, 9, 13, and 17 units. The firm is preparing an aggregate plan that uses inventory, regular time and overtime and back orders. Subcontracting is not allowed. Regular time capacity is 15 units for quarters 1 and 2, 18 units for quarters 3 and 4. Overtime capacity is 3 units per quarter. Regular time cost is $2000 per unit, while overtime cost is $3000 per unit. Back order cost is $300 per unit per quarter; inventory holding cost is $100 per unit per quarter. Beginning inventory is zero. The data inputs for this problem, and the optimal solution, generated by microcomputer software, appear below. Answer the following questions based on the scenario and the solution. (a) How many total units will be produced in quarter 1 for delivery in quarter 1? (b) How many units in total will be used to fill back orders over the four quarters? (c) What is the cost to produce one unit in Quarter 4 using overtime to deliver in quarter 1 (filling a back order)? (d) At the end of quarter 3, what is the ending inventory of finished systems? (e) What is the total cost of the solution? (f) What is the average cost per unit? Reddick's Specialty Electronics Reddick's Specialty Electronics Solution

When developing an aggregate plan, one of the adjustable elements of capacity is the extent of subcontracting.

________ involves capacity decisions that determine the allocation of resources to maximize revenue or yield.

In level scheduling, what is kept uniform from month to month?

________ are designed to be consistent with top management's long-range plans and strategy, and work within the resource constraints determined by earlier strategic decisions.

One of the capacity options of aggregate planning is to vary the workforce by hiring or layoffs.

The strategies of aggregate planning are broadly divided into demand options and forecast options.

Graphical techniques are easy to understand and use, and they are well-suited for generating optimal strategies.

Finding an ideal mixed strategy is complicated by the huge number of possible strategies.

Which of the following aggregate planning strategies is known to lower employee morale?

Developing a mix of ________ products is a widely used demand smoothing technique.

An electronics manufacturer makes video security systems for parking lots. Demand estimates for the next four quarters are 15, 19, 23, and 17 units. The company is preparing an aggregate plan that uses inventory, regular time, overtime, and backorders. Subcontracting is not allowed. Regular time capacity is 13 units for quarters 1 and 2, 16 units for quarters 3 and 4. Overtime capacity is 6 units per quarter. Regular time cost is $20,000 per system, while overtime cost is $30,000 per system. Backorder cost is $2000 per system per quarter; inventory holding cost is $1000 per system per quarter. Beginning inventory is 2. Complete the table of data inputs for solving this aggregate planning problem with the transportation method. Specifically, how many sources are there, and how many destinations? What is the supply from each source, and the demand of each destination? What is the cost of each source-destination pair?

Normally, the transportation model is used to solve problems involving several physical sources of product and several physical uses of the product, as in factories and warehouses. How is it possible to use the transportation model where the "routes" are from one time period to another? Describe how this provides aggregate planners with a usable mathematical model.

Explain the fundamental difference between the "capacity options" and the "demand options" of aggregate planning strategies.