Objectives of Chapters 7,8

Transcription

1 Objecives of Chapers 7,8 Planning Demand and Supply in a SC: (Ch7, 8, 9) Ch7 Describes mehodologies ha can be used o forecas fuure demand based on hisorical daa. Ch8 Describes he aggregae planning mehodology used o plan producion, disribuion and allocae resources for he near fuure, by making rade-offs among capaciy, invenory and backlogged orders across he enire SC. Ch9 Describes how pricing and promoions can be planned o manage cusomer demand in coordinaion wih producion and disribuion Pearson Educaion 8-1

2 Supply Chain Managemen (3rd Ediion) Chaper 8 Aggregae Planning in he Supply Chain 2007 Pearson Educaion 8-2

3 Ouline Role of aggregae planning in a supply chain The aggregae planning problem Aggregae planning sraegies Implemening aggregae planning in pracice 2007 Pearson Educaion 8-3

4 Role of Aggregae Planning in a Supply Chain Capaciy has a cos, lead imes are greaer han zero Aggregae planning: process by which a company deermines ideal levels of capaciy, producion, subconracing, invenory, sockous, and pricing over a specified ime horizon goal is o maximize profi and saisfy demand decisions made a a produc family (no SKU) level ime frame of 3 o 18 monhs how can a firm bes use he faciliies i has? 2007 Pearson Educaion 8-4

5 Role of Aggregae Planning in a Supply Chain Specify operaional parameers over he ime horizon: producion rae workforce overime machine capaciy level subconracing backlog invenory on hand All supply chain sages should work ogeher on an aggregae plan ha will opimize supply chain performance 2007 Pearson Educaion 8-5

6 The Aggregae Planning Problem Given he demand forecas for each period in he planning horizon, deermine he producion level, invenory level, and he capaciy level for each period ha maximizes he firm s (supply chain s) profi over he planning horizon Specify he planning horizon (ypically 3-18 monhs) Specify he duraion of each period (In general monhs or quarers) Specify key informaion required o develop an aggregae plan 2007 Pearson Educaion 8-6

7 Informaion Needed for an Aggregae Plan Demand forecas in each period Producion coss labor coss, regular ime ($/hr) and overime ($/hr) subconracing coss ($/hr or $/uni) cos of changing capaciy: hiring or layoff ($/worker) and cos of adding or reducing machine capaciy ($/machine) Labor/machine hours required per uni Invenory holding cos ($/uni/period) Sockou or backlog cos ($/uni/period) Consrains: limis on overime, layoffs, capial available, sockous and backlogs. Consrains from suppliers o he enreprise 2007 Pearson Educaion 8-7

8 Oupus of Aggregae Plan Producion quaniy from regular ime, overime, and subconraced ime: used o deermine number of workers and supplier purchase levels Invenory held: used o deermine how much warehouse space and working capial is needed Backlog/sockou quaniy: used o deermine wha cusomer service levels will be Machine capaciy increase/decrease: used o deermine if new producion equipmen needs o be purchased A poor aggregae plan can resul in los sales, los profis, excess invenory, or excess capaciy 2007 Pearson Educaion 8-8

9 Fundamenal Tradeoffs in Aggregae Planning Capaciy (regular ime, overime, subconrac) Invenory Backlog / los sales because of delay The cos of each one is negaively correlaed wih he combined cos of he oher wo. AP is abou achieving balance beween hese coss and making he mos profiable combinaion of rade-offs Pearson Educaion 8-9

10 Aggregae Planning Sraegies Chase sraegy using capaciy as he lever Time flexibiliy from workforce or capaciy sraegy using uilizaion as he lever Level sraegy using invenory as he lever Mixed or ailored sraegy a combinaion of one or more of he firs hree sraegies 2007 Pearson Educaion 8-10

11 Chase Sraegy Producion rae is synchronized wih demand by varying machine capaciy or hiring and laying off workers as he demand rae varies However, in pracice, i is ofen difficul o vary capaciy and workforce on shor noice Expensive if cos of varying capaciy is high Negaive effec on workforce morale Resuls in low levels of invenory Should be used when invenory holding coss are high and coss of changing capaciy are low 2007 Pearson Educaion 8-11

12 Time Flexibiliy Sraegy Can be used if here is excess machine capaciy Workforce is kep sable, bu he number of hours worked is varied over ime o synchronize producion and demand Can use overime or a flexible work schedule Requires flexible workforce, bu avoids morale problems of he chase sraegy Low levels of invenory, lower uilizaion Should be used when invenory holding coss are high and capaciy is relaively inexpensive 2007 Pearson Educaion 8-12

13 Chase Demand Demand Producion Unis Time 2007 Pearson Educaion 8-13

14 2007 Pearson Educaion Level Sraegy Mainain sable machine capaciy and workforce levels wih a consan oupu rae Shorages and surpluses resul in flucuaions in invenory levels over ime Invenories ha are buil up in anicipaion of fuure demand or backlogs are carried over from high o low demand periods Beer for worker morale Large invenories and backlogs may accumulae Should be used when invenory holding and backlog coss are relaively low 8-14

15 Level Producion Demand Producion Unis Time 2007 Pearson Educaion 8-15

16 Aggregae Planning a Red Tomao Tools Monh Demand Forecas January 1,600 February 3,000 March 3,200 April 3,800 May 2,200 June 2, Pearson Educaion 8-16

17 Aggregae Planning Iem Maerials Invenory holding cos Marginal cos of a sockou Hiring and raining coss Layoff cos Labor hours required Regular ime cos Over ime cos Cos of subconracing Cos $10/uni $2/uni/monh $5/uni/monh $300/worker $500/worker 4/uni $4/hour $6/hour $30/uni 2007 Pearson Educaion 8-17

18 Aggregae Planning (Define Decision Variables) W Workforce size for monh, 1,..., 6 H Number of employees hired a he beginning of monh, 1,..., 6 L Number of employees laid off a he beginning of monh, 1,..., 6 P Producion in monh, 1,..., 6 I Invenory a he end of monh, 1,..., 6 S Number of unis socked ou a he end of monh, 1,..., 6 C Number of unis subconraced for monh, 1,..., 6 O Number of overime hours worked in monh, 1,..., Pearson Educaion 8-18

19 Pearson Educaion Aggregae Planning (Define Objecive Funcion) C P S I O L H W Min

20 Aggregae Planning (Define Consrains Linking Variables) Workforce size for each monh is based on hiring and layoffs W W 1 + H L, or W W 1 H + L 0 for 1,...,6, where W Pearson Educaion 8-20

21 Aggregae Planning (Consrains) Producion for each monh canno exceed capaciy P 40W + O 4, 40W + O 4 P 0, for 1,..., Pearson Educaion 8-21

22 Pearson Educaion Aggregae Planning (Consrains) Invenory balance for each monh , 1,000, 1,...,6, 0,, I and S I where for S I S D C P I S I S D C P I

23 Aggregae Planning (Consrains) Over ime for each monh O 10W, 10W O 0, for 1,..., Pearson Educaion 8-23

24 Scenarios Increase in holding cos (from $2 o $6) Overime cos drops o $4.1 per hour Increased demand flucuaion 2007 Pearson Educaion 8-24

25 Increased Demand Flucuaion Monh Demand Forecas January 1,000 February 3,000 March 3,800 April 4,800 May 2,000 June 1, Pearson Educaion 8-25

26 Aggregae Planning in Pracice Think beyond he enerprise o he enire supply chain Make plans flexible because forecass are always wrong Rerun he aggregae plan as new informaion emerges Use aggregae planning as capaciy uilizaion increases 2007 Pearson Educaion 8-26

27 Summary of Learning Objecives Wha ypes of decisions are bes solved by aggregae planning? Wha is he imporance of aggregae planning as a supply chain aciviy? Wha kinds of informaion are needed o produce an aggregae plan? Wha are he basic rade-offs a manager makes o produce an aggregae plan? How are aggregae planning problems formulaed and solved using Microsof Excel? 2007 Pearson Educaion 8-27