UNIT

III
 AGGREGATE PLANNING

 An organization can finalize its business plans on the recommendation of demand

forecast.
 Once business plans are ready, an organization can do backward working from the final
sales unit to raw materials required.
 Thus annual and quarterly plans are broken down into labor, raw material, working
capital, etc. requirements over a medium-range period (6 months to 18 months).
 This process of working out production requirements for a medium range is called
aggregate planning.
Definition
Aggregate Planning in Operations Management determines
production and resource allocation strategies to meet the
uncertain and fluctuating future demand at minimum production
cost for the Intermediate Time Horizon.

‘Aggregate‘ signifies the product lines and families. And ‘Planning‘

covers the series of activities to be taken in order to meet the
expected demand.
AGGREGATE PLANNING
STRATEGIES
 AGGREGATE PLANNING
STRATEGIES
LEVEL STRATEGY

 This type of aggregate planning deals with producing goods of similar quantities over equal
duration.
 This is done to handle a peak in market demand by filling out back orders or by sending the
extra products to inventory.
 The level strategy is considered a traditional aggregate planning method that maintains a
steady production rate as well as the level of the workforce by continuing consistent human
resources and production in the organization.
 It is best suited where the inventory carrying costs are not high and are adopted by mainly
manufacturing companies.
 AGGREGATE PLANNING
CHASESTRATEGIES
STRATEGY
 The chase strategy of aggregate planning puts its onus on reducing inventory.
 It keeps pace with demand fluctuations by varying either actual level of output or
the workforce number.
 It is considered not as rigid as a level strategy as it allows room for some deviation
from the conventional approach.
 This methodology helps to minimize waste by receiving goods when needed. It
often leads to stressed employees.
 This strategy is popular in several industries like hospitals, hospitality business
and educational centers like schools.
AGGREGATE PLANNING
STRATEGIES
MATERIALS REQUIREMENT
PLANNING
SCHEDULING
 SCHEDULING
 It is the process of planning, coordinating, and controlling the use of
resources to complete a production process.
 It involves deciding when to start and finish each task, which
resources to use for each task, and the sequence in which to carry out
the tasks.
 In manufacturing, scheduling in operations management is often
done using computer software that considers various constraints such
as available resources, customer demand, and production capacity
 OBJECTIVES OF THE OPERATIONS
SCHEDULING
 Making efficient use of the labour.
 Making best possible use of the Equipments that are available for the use.
 Increasing the profit.
 Increasing the output.
 Minimizing the inventory.
 Reducing the manufacturing time.
 Minimizing the production costs.
Types of Scheduling
TYPES OF
SCHEDULING

Master Schedule

Manufacturing Schedule

Parts Scheduling

Machine Loading Schedule

 TYPES OF SCHEDULING
Master Schedule

 Preparation of the master schedule is the first step in the scheduling exercise.
 Master schedule involves breaking down of the weekly or monthly
requirement in respect of each product for a certain time-frame.
 This running record of the total production requirements enables the
manufacturer to change the production exercise from one product to another
according to the changed production requirements.
 Master schedule is the basis of a all the successive scheduling activities
 TYPES OF SCHEDULING

Manufacturing Schedule

 Preparation of manufacturing schedule depends upon the nature /pattern of manufacturing

process.
 Manufacturing schedule is of extreme use in the cases, where the production of a single or few
products takes place in a repetitive manner on a regular basis.
 It shows the necessary quality of order and each product in which the same needs to be operated.

Parts Scheduling

 Parts scheduling provides the information with regard to the number of units required to be
produced in respect of various parts of a product.
 It is prepared on the basis of master schedule every month giving the details i of production for
every week.
SINGLE MACHINE
SCHEDULING
 SINGLE MACHINE SCHEDULING

 There is one machine on which several jobs have to be processed.

 The order in which these jobs will be processed needs to be specified.

 This schedule will not be changed until all jobs have been processed.

 This is the “static” version of the problem.

 In the “dynamic” version, the schedule can be altered.

 Scheduling Rules

There are several rules that can be used to find the order of processing.

First Come First Served (FCFS)

Shortest Processing Time (SPT). This is also called as Shortest Operation Time.

Earliest (shortest) Due Date (EDD)

 OBJECTIVE FUNCTIONS

Minimize average completion (flow) time.

Minimize average number of jobs in the system.
Minimize average tardiness.
Minimize maximum tardiness
Minimize number of tardy jobs.
 Example
Consider the example given on the RHS.

There are five jobs A, B, C, D, and E. A is the first job that arrived in the production department. B,C, D, and E
followed A in this order.

The processing times and due dates of all jobs are also given.

The order in which these jobs have to be processed needs to be specified.

Days
Due
Job Time
Date
A 17 45
B 12 35
C 22 27
D 18 54
E 26 47
 Scheduling Rules

First Come First Served (FCFS)

 First Come First Served (FCFS)

The table on RHS gives answers by using the FCFS rule. First Come First Served
The order of processing is A, B, C, D, and E.
Due Completi
Job Time Tardiness
A is the first job to be processed and will be completed at Date on Time
time 17. Its due date is 45. So job A is not late (tardy); A 17 45 17 0
tardiness is zero.
B 12 35 29 0
Job B starts after job A, and is completed at time 29 (17+12). C 22 27 51 24
This is also not tardy.
D 18 54 69 15
In this way the completion time and tardiness of all jobs E 26 47 95 48
are completed
Tardiness = Completion Time – Due Date
FCFS: CALCULATION OF OBJECTIVE
FUNCTIONS
Average Completion Time: Add completion times of
all jobs and divide by the number of jobs (261/5). It
is 52.5.

Average Number of Jobs in the System: This is

obtained by dividing the total of completion times
of all jobs by the completion time of the last job
(261/95). It is 2.75.

Average Tardiness : This is obtained by adding the

tardiness of all jobs and dividing it by the number
=261/ 5
of jobs (87/5). It is 17.4.
= 2561/ 95
= 87/ 5 Maximum Tardiness: This is the maximum of all
tardiness values, It is 48.

Number of Tardy Jobs: Count the number of jobs

that are tardy. Three jobs (C, D, and E) are tardy for
this problem. It is 3.
 SCHEDULING RULES

Shortest Processing Time (SPT)

 Shortest Processing Time (SPT)
Shortest Processing Time
Completion
Job Time Due Date Tardiness
Time
B 12 35 12 0
A 17 45 29 0
D 18 54 47 0
C 22 27 69 42
E 26 47 95 48
Total 252 90

Average Completion Time 50.4 =252/ 5

Average Number of Jobs in System 2.65
= 252 / 95
Average Tardiness 18
Maximum Tardiness 48 = 90/ 5
Number of Tardy Jobs 2
The jobs are processed in the increasing order of their processing times.

The job with the minimum processing time (B) is processed first. B is followed by A, D, C, and E.

The calculations of the objective functions follow the same procedure as for the FCFS rule.
Earliest Due Date (EDD)
 Earliest Due Date (EDD)
Earliest Due Date
The jobs are processed in the increasing order of
Completion their due dates.
Job Time Due Date Tardiness
Time
C 22 27 22 0 The job with the minimum due date (C) is processed
B 12 35 34 0 first; and is followed by B, A, E, and D.
A 17 45 51 6
The calculations of the objective functions follow the
E 26 47 77 30
same procedure as for the FCFS rule
D 18 54 95 41
Total 279 77

Average Completion Time 55.8 =279/ 5

Average Number of Jobs in System 2.94 = 279 / 95
Average Tardiness 15.4 = 77/ 5
Maximum Tardiness 41
Number of Tardy Jobs 3
 SOLUTIONS
JOB M1 M2
A 8 3
B 5 7
C 6 9
D 7 1
ANSWER
E 4 6
PRIORITY JOB
M1 is have the Minimum time is mention the job from 1 E
the top priority 2 B
3 C
M2 is have the Minimum time is mention the job from
the least priority 4 A
5 D