App Template Name 1 Name 2 Name 3 Given Values Decision Cell ✓ Solved

App Templatename 1name 2name 3given Values Decision Cells Formul

Construct a feasible, low-cost, mixed strategy production plan for three product families over a twelve-month period using the provided Excel template. Maintain the original template layout, including all rows and columns. Your plan should specify production quantities, workforce levels, hiring, layoffs, and inventory management, ensuring capacity constraints are not violated. Use formulas within the template to calculate total costs, including regular and overtime labor costs, hiring and layoff costs, and inventory holding costs. Submit your completed plan, with formulas intact, by the deadline specified. The plan must adhere to capacity limitations: 160 regular hours per worker per month and 40 overtime hours per worker per month, with specific labor costs per worker. Your goal is to minimize total costs while meeting the demands for each family each month.

Sample Paper For Above instruction

The objective of this analysis is to develop a feasible and cost-effective aggregate production plan for three product families—Family A, Family B, and Family C—over a twelve-month horizon. Given the demand forecast, capacity constraints, and associated costs, the goal is to determine the optimal production schedule and workforce adjustments that satisfy demand while minimizing total operating costs.

Introduction

Aggregate production planning plays a pivotal role in manufacturing operations by balancing demand with production capacity, workforce levels, and inventory management. The challenge lies in devising a plan that adheres to capacity constraints—namely, regular and overtime labor hours per worker per month—while controlling costs associated with hiring, layoffs, and inventory holdings. This analysis leverages the provided Excel template to construct a plan that addresses these parameters effectively.

Demand Overview and Capacity Constraints

The demand forecasts for the three families are as follows: Family A varies from 4,000 to 19,000 units; Family B ranges from 2,000 to 9,000 units; Family C fluctuates between 3,000 and 9,000 units across the twelve months. The company's capacity constraints allow each worker 160 regular hours per month with an additional 40 hours of overtime. The production rate is specified as units per hour for each family: Family A at 2 units/hour, Family B at 5 units/hour, and Family C at 4 units/hour.

Cost Parameters

The baseline labor cost is set at $5,000 per worker per month for regular time, with overtime hours costing $45 per hour. Hiring and layoffs entail costs of $6,500 and $4,500 per worker, respectively. Inventory holding costs are implicitly considered through the planning, aiming to minimize excess stock and shortages.

Methodology

The approach involves calculating the required number of workers each month based on demand and production capabilities. Formulas within the Excel template will determine production levels, workers needed (no overtime, maximum overtime), and workforce adjustments (hiring or layoffs). The goal is to meet demand exactly each month, avoiding stockouts or excessive inventories, while limiting overtime and workforce fluctuations.

Feasibility and Optimization

Feasibility is assessed by verifying that production quantities do not exceed the maximum capacity derived from the number of workers and available hours (both regular and overtime). The plan must also keep costs minimized by balancing the costs of hiring, layoffs, and overtime. For instance, if demand exceeds regular capacity, overtime should be used judiciously, and workforce adjustments should be made considering associated costs.

Conclusion

By carefully adjusting workforce levels, production quantities, and inventory, the formulated plan strives to meet demands at the lowest possible cost within capacity constraints. The resulting plan will serve as an operational guide that maximizes efficiency while controlling expenses, ensuring competitiveness and fulfillment of customer orders throughout the planning period.

References

  • Heizer, J., Render, B., & Munson, C. (2020). Operations Management (13th ed.). Pearson.
  • Stevenson, W. J. (2021). Operations Management (14th ed.). McGraw-Hill Education.
  • Chase, R. B., Jacobs, F. R., & Aquilano, N. J. (2019). Operations Management for Competitive Advantage. McGraw-Hill Education.
  • Silver, E. A., Pyke, D. F., & Peterson, R. (2016). Inventory Management and Production Planning and Scheduling. Wiley.
  • Johnson, H. T., & Kaplan, R. S. (1987). Relevance Lost: The Rise and Fall of Management Accounting. Harvard Business Review.
  • Buzacott, J. A., & Shanthikumar, J. G. (1993). Stochastic Models of Production Operations. Prentice Hall.
  • Lysons, K., & Farrington, B. (2016). Purchasing and Supply Chain Management (9th ed.). Pearson.
  • Chopra, S., & Meindl, P. (2016). Supply Chain Management: Strategy, Planning, and Operation. Pearson.
  • Simchi-Levi, D., Kaminsky, P., & Simchi-Levi, E. (2008). Designing and Managing the Supply Chain. McGraw-Hill Education.
  • Lee, H. L., & Billington, C. (1992). Managing Supply Chain Inventory: Pitfalls and Opportunities. Sloan Management Review.

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