Ch 13 - Aggregate Planning Flashcards
Strategic business plan
a statement of long-range strategy & revenue, cost, & profit objectives
sales & operations planning
the process that brings together all the functional business plans (marketing, operations, engineering, and finance) into one integrated plan
marketing plan
identifies the markets to be served, desired levels of customer service, product competitive advantage, profit margins, and the market share needed to achieve the objectives of the strategic business plan
aggregate plan
includes the budgeted levels of finished products, inventory, backlogs, workforce size, and aggregate production rate needed to support the marketing plan
financial plan
identifies the sources and uses of funds; projects cash flows, profits, return on investment; and provides budgets in support of the strategic business plan
engineering plan
identifies new products or modification to existing products that are needed to support the marketing plan
master production schedule
the anticipated production schedule for the company expressed in specific configuration, quantities, and dates
demand-based options
a group of options that respond to demand fluctuations through the use of inventory or back orders. or by shifting the demand pattern
capacity-based options
a group of options that allow the firm to change its current operating capacity
finished goods inventory
products available for shipment to the customer
back orders
unfilled customer orders
shifting demand
a marketing strategy that attempts to shift demand from peak periods to nonpeak periods to smooth out the demand pattern
overtime
work beyond normal established operation hours that usually requires a premium to be paid to the workers
undertime
a condition occurring when there are more people on the payroll than are needed to produce the planned output
subcontracting
sending production work outside to another manufacturer or service provider
hiring & firing
long-term option for increasing or decreasing capacity
point of departure
the percentage of normal capacity the company is currently using
magnitude of the change
the relative size of the change needed
duration of the change
the expected length of time the different capacity level is needed
level aggregate plan
a planning approach that produces the same quantity each time period. Inventory and back orders are used to absorb demand fluctuations
chase aggregate plan
a planning approach that varies production to meet demand each period
hybrid aggregate plan
a planning approach that uses a combination of level and chase approaches while developing the aggregate plan
yield management
allocates scarce resources to maximize yield
