Aggregate Planning and JIT - Week 5

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planning horizons
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operational, tactical, strategic
operational decisions (up to3 months)
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short-range plans: job assignments, ordering, job scheduling, dispatching
tactical decisions (up to 2 years)
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intermediate-range plans: sales planning, production planning and budgeting, setting employment, subcontracting levels
strategic decisions (up to 5 years)
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long-range plans: R&D, new product plans, capital expenses, facility location
Aggregate planning Goals
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meet demand, use capacity efficiently, minimise cost, meet inventory policy
AP strategies
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change capacity - inventory levels, varying work force, subcontracting, using part-time workers; change demand - influencing demand, backordering during high demand periods; Mixed strategy
Just-in-Time
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supplies end components are pulled through the system to arrive where and when are needed; attacks waste; exposes problems and bottlenecks; Lean production is its western implementation
7 wastes of JIT
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overproducing, waiting, transportation, inefficient processing, inventory, unnecessary motion, product defects
push system (MRP)
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material is pushed into downstream workstations, regardless of whether resources are available; make-to-stock
pull system (JIT)
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material is pulled to a workstation just as it is need; make-to-order
Results of JIT
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queue and delay reduction: speeds throughput, frees assets; quality improvement, cost reductions, rework reduction, variability reductions in the workplace

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