Class Notes (1,100,000)
US (480,000)
Rutgers (10,000)
46:19:00 (100)
Lecture 13

33:799:301 Lecture Notes - Lecture 13: Master Production Schedule, Production Planning, Workforce Management

Supply Chain Management
Course Code
James King

This preview shows half of the first page. to view the full 3 pages of the document.
Production Planning Strategies - Primary purpose is to establish the production methodology
that will satisfy customer demand while balancing production costs and inventory through
workforce management
Objectives include:
- Satisfy demand
- Manage capacity efficiently
- Manage inventory levels
- Minimize cost: labor, inventory, plant and equipment, workforce
Three basic production strategies:
1. Level Production Strategy - Relies on a constant output rate over an extended period of
time based on worker productivity while varying inventory and backlog according to
fluctuating demand. Works well for make-to-stock firms
2. Chase Production Strategy - Adjusts capacity to match demand. Firm hires and lays off
workers to match output to demand, finished goods inventory remains consistent based
on worker productivity. Works well for make-to-order firms
3. Mixed Production Strategy - Maintains stable core workforce while using short-term
means, such as overtime, subcontracting and part time helpers to manage short-term
demand fluctuations. Works well for make-to-stock firms with custom options, seasonal
Developing the Production Plan
1. Gather the demand for each product, periodically
2. Compare to the available capacity for each period in planning horizon
3. Identify constraints
4. Determine labor and material requirements for production plan
5. Calculate production costs each product
6. Develop the detailed Materials Requirements Plan for execution
Production Planning Strategies - Demand Side
Influence demand - to align with production capacity
- Pricing
- Advertising
- Promotions
Back-ordering during high demand periods - accept that demand is greater than supply
capabilities, supply when available
Counter-seasonal product mix - Develop a product mix with offsetting seasonal trends to level
the required production capacity
Production Planning Strategies - Supply Side
find more resources at
find more resources at
You're Reading a Preview

Unlock to view full version