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UCL ESPO/IAG/POMS PROD 2800 PRODUCTION AND OPERATIONS MANAGEMENT Gestion de la production et des opérations Per AGRELL Lecture 3Aggregate.

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Presentation on theme: "UCL ESPO/IAG/POMS PROD 2800 PRODUCTION AND OPERATIONS MANAGEMENT Gestion de la production et des opérations Per AGRELL Lecture 3Aggregate."— Presentation transcript:

1 UCL ESPO/IAG/POMS PROD 2800 PRODUCTION AND OPERATIONS MANAGEMENT Gestion de la production et des opérations Per AGRELL agrell@poms.ucl.ac.be Lecture 3Aggregate planning

2 PROD 28002 Outline Hierarchical production planning Aggregate production planning – Models – Approaches Yield management

3 PROD 28003 Product structure framework

4 PROD 28004 Customer order point

5 PROD 28005 Production planning Planning problem – Uncertainty – Dimensionality How to make a consistent production planning system over multiple time horizons in a complex, uncertain world?

6 PROD 28006 Hierarchical production planning Defined decision level – Resource horizon – Demand uncertainty – Process uncertainty – Information Principles: Higher levels set resources and targets for next lower level Postpone detailed decisions until uncertainty is reduced

7 PROD 28007 HPP example Annual demand by item and by region Annual demand by item and by region Monthly demand for 15 months by product type Monthly demand for 15 months by product type Monthly demand for 5 months by item Monthly demand for 5 months by item INFORMATION Allocates production (time) among plants Allocates production (time) among plants Determines seasonal plan by product type Determines seasonal plan by product type Determines monthly item production schedules Determines monthly item production schedules DECISIONDECISION LEVEL Corporate Plant manager Shop manager

8 PROD 28008 Marketing planning Business plan Financial planning Production planning Demand management Resource planning Aggregate planning Master production scheduling Master requirements planning Inventory control Order scheduling Purchasing Dispatching Demand forecasts Order

9 PROD 28009 Aggregate planning Objective – Adjust resources to meet fluctuating demand. Means – Aggregated production rate – Aggregated workforce level – Aggregated inventory level Long-term – 1-5 years Uniform measures Frame for lower level planning Basis for Facility Location Analysis

10 PROD 280010 Aggregation rules Products Product Groups Machines Machine Groups Customers Market Regions Operators Labor Centers Products Machines Operators Customers Criteria?Measure?

11 PROD 280011 Time horizon in APP t

12 PROD 280012 Relevant costs Production – Direct costs – Overtime/undertime costs Capacity change – Hiring/firing costs – Extra setup costs, opportunity costs – Subcontracting Inventory – Holding cost Backorder/shortage costs

13 PROD 280013 Decision Inventory level Delivery regime (MTO,MTS) Change in workforce Change of load (overtime) Subcontracting Change of process Complementary lines

14 PROD 280014 Capacity Strategies t Aggregate demand

15 PROD 280015 Classical LP Models Dynamic, deterministic, piecewise linear costs Objective: – Total expected cost Decision: – Inventory/backlog – Workforce (hiring/firing) – Workload (overtime)

16 PROD 280016 Yield management Demand management – Segmentation on Price Order regime Service level – Management of Duration Cost

17 PROD 280017 Price/service duration matrix FixedVariable Predictable Unpredictable DURATION PRICE

18 PROD 280018 Summary Hierarchical planning principle Aggregated planning – Level, chase, lead strategies – Workforce and inventory tradeoffs Long-term horizon Linear programming Yield management


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