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Ch-12 Agt Planning
Ch-12 Agt Planning
OPERATIONS
MANAGEMENT
Chapter 12
AGGREGATE PLANNING AND
MASTER PRODUCTION
SCHEDULING
Chapter 12
Aggregate Planning and
Master Production Scheduling
STRATEGIES OF APS
• Capacity Decisions
• Major considerations in capacity decisions are
a. What size of plant? How much capacity to install?
b. When capacity is needed? When to phase-in capacity
or phase-out capacity?
c. At what cost? How to budget for the cost?
• Factors Affecting Determination of Plant Capacity
1. Market demand for a product/service.
2. The amount of capital that can be invested.
3. Degree of automation desired.
4. Level of integration (i.e., vertical integration).
5. Type of technology selected.
6. Flexibility for capacity additions.
Capacity Planning
Capacity planning involves activities such as:
a. Assessing existing capacity
b. Forecasting future capacity needs
c. Identifying alternative ways to modify capacity
d. Evaluating financial, economical and technological
capacity alternatives
e. Selecting a capacity alternative most suited to achieve
the strategic mission of the firm. Capacity planning
involves capacity decisions that must merge consumer
demands with human, material and financial resources
of the organization.