Aggregate Production Planning Problem

2714 Words11 Pages
A Decision Support System to formulate an Aggregate Production Planning Problem Ravi Yerigeri1, Manoj N. Kshirsagar2, Prof. S.N.Teli3 1Terna Engineering college, Navi Mumbai, India, 2Terna Engineering college, Navi Mumbai, India , 3Saraswati College of Engineering,Kharghar,India, Abstract: The Aggregate Production Planning (APP) problem is concerned with determining the optimum production, work force and inventory levels for each period of the planning horizon. The Aggregate Production Planning problem is a multiple objective one that involves many functional areas to create. This paper addresses an implementation of a…show more content…
A decision maker must make the decisions regarding to production quantity, backorder quantity, Subcontracting quantity, inventory level, employment level, hiring and layoff. Conventionally a revenue function, a cost function and a profit function are chosen to be the objective function for an APP problem. Most of the literatures set the cost function as the main objective function ( 1-4 ). Few research works of the APP problem use a profit function (5). Instead of measuring by cost, factories should evaluate their performance by throughput. This kind of suggestion is called “Theory of constraints (TOC)”. Goldratt has presented TOC for implementation of a system approach to an organization. In order to implement, the gap between day-to-day decision making and the purpose of the organization have to bridge. Method of measurement than can be agreed upon by all parties must be identified before discussion of improvement. Most would agree that return of investment (ROI) and net profit are sufficient measurements for determining whether an improvement has occurred. Goldratt has presented the new set of measurements which consists of…show more content…
The problem is a multi period model with decisions on, production quantity, backorder quantity, subcontracting quantity, inventory level, employment level, hiring and layoff must be considered. Different types of methods used for Aggregate Production Planning in different Decision Support Systems, as per the availability are: 1. Linear Decision Rule (LDR), 2. Linear Programming Model (LP), 3. Management Coefficients Model (MCM), 4. Parametric Production Planning Model (PPP), 5. Search Decision Rule (SDR). 6. Productivity Switch Heuristics (PSH), 7. Goal Search Approach (GSA). In this article, we are using Linear programming to calculate the results of investigation. To demonstrate, some data are gathered as a case study where it is considered 3 products, A, B and C are sold as shown in the Table No 1 are sold in the market at $50, $75 and $60 per unit respectively. (1) Product (2) Limiting work center (3) Processing time per unit (minutes) (4) Product output rate (per hour) (5) Selling price (6) Raw material cost

More about Aggregate Production Planning Problem

Open Document