Aggregate Production Planning
Aggregate Production Planning (APP) bridges the gap between high-level strategic capacity decisions and granular, day-to-day scheduling. Operating on an intermediate time horizon of 2 to 18 months, APP focuses on macro-level production rates and workforce sizing. The objective is to design a tactical strategy—whether purely Level, Chase, or a custom Mixed approach—that seamlessly absorbs fluctuations in anticipated demand while mathematically minimizing the combined costs of regular labor, subcontracting, hiring, firing, and inventory holding.
Level Strategy
Maintains a steady rate of regular-time output. Variations in demand are met by utilizing inventories, backlogs, and occasional subcontracting. Best for expensive hiring/firing.
Chase Strategy
Matches capacity directly to demand. Output is set exactly to the expected demand for that period by constantly hiring and firing workers. Best for high inventory holding costs.
Mixed Strategy
A customized combination of approaches. It attempts to find the optimal mathematical balance between carrying inventory, subcontracting, and adjusting the workforce.
Auto-updates on change. Click cells in the table for step-by-step logic.
| Period | Demand | Production | Inventory | Hires/Fires | Total Cost |
|---|
Fill in the table below based on the current inputs. Click "Verify" to check your answers against the system logic.
| Metric / Period |
|---|