Cairo University Faculty of Engineering Mechanical Design & Production Dept.

t. Production & Operations Management (MDP408b) Fall 2010 Tutorial #3: Aggregate planning
Problems to be solved by students in class: --Problems to be solved by the TA in class: 1, 2 and 4(a) Problems to be solved by students and submitted next week: 3 and 4(b)

1) A toy manufacturing company produces six types of toys. All components and parts are manufactured elsewhere, while the final assembly is conducted in house. The assembly times needed per unit for each type of toys are listed in the following table. Toy KoKi Habibi Winni Kitti Barbi Chevi Assembly time (min.) 3 8 6 4 8 10

The forecasted demand requirements over the next four quarters are given in the following table. Toy KoKi Habibi Winni Kitti Barbi Chevi 1 400 80 900 50 1200 90 Quarter 2 3 200 300 120 130 800 700 60 80 1300 1300 120 110

4 500 150 800 90 1500 100

Based on the assembly time data, evaluate the aggregate demand for the four quarters. What is the assembly time needed for an aggregate unit?

2) Suppose in problem 1, the company manager decided to use the unit selling price in determining the aggregate units. That is, the aggregate product will be measured in terms of the equivalent monetary value evaluated using the unit selling price of each product. The following table lists the selling price per unit for each product. Toy KoKi Habibi Winni Kitti Barbi Chevi Selling price (LE/unit) 10 40 20 20 60 80

Evaluate the aggregate demand and the assembly time needed for an aggregate unit.

3) A steel manufacturing company produces three types of steel sheet metal, labeled S1, S2 and S3, with different thicknesses and widths. It also produces two types of steel wire rods, labeled R1 and R2, with different diameters for industrial and construction projects. Both sheet metal and wire rods are produced in the form of coils. The production time and coil weight for each product are listed in the following table. Product type S1 S2 S3 R1 R2 Coil weight (ton) 5 8 12 1.5 2 Production time (hrs) 2.6 2.3 1.8 1.5 1.2

The forecasted demand (in number of coils) for the next six months for each product type is listed below. Product S1 S2 S3 R1 R2 1 1000 1200 1300 2400 1500 2 800 1000 900 2500 1600 3 800 900 800 2300 1700 Month 4 700 1000 800 2200 2000 5 850 1100 900 2300 1900 6 900 1200 1000 2400 1800

Based on the products weights, evaluate the aggregate demand and the assembly time needed for an aggregate unit.

4) Given below the forecasted demand and available work time for 12 months. Two different sets of forecasted demand of two different aggregate units are provided. Forecasted demand Set A Set B 50 50 60 60 55 70 55 65 50 55 45 80 40 250 70 240 95 110 260 100 240 80 200 60

Month 1 2 3 4 5 6 7 8 9 10 11 12

The following are other necessary information:

Initial inventory Initial workforce Regular-time production rate Cost of regular-time production Cost to carry inventory Cost of stockout Cost of hiring new people Cost of laying off people

20 units 20 people 3 unit/worker/month LE 500/unit LE 25/unit/month LE 100/unit/month LE 900/person LE 800/person

a) For data set A only, use the tabular/graphical approach to find a suitable production plan with as minimal total cost as you can.

b) For data set B only, use the tabular/graphical approach to find a suitable production plan with as minimal total cost as you can.