What are the 3 strategies for aggregate production planning?

3 Types of Aggregate Planning Strategies

  • Level Strategy: The goal of an aggregate planning strategy is to keep the production rate and the workforce level.
  • Chase Strategy: As the name implies, you are chasing market demand.
  • Hybrid Strategy: There is a third alternative, which is a hybrid of the previous two strategies.

What is the level production strategy?

The use of a level strategy means that a company will produce at a constant rate regardless of the demand level. In companies that produce to stock, this means that finished goods inventory levels will grow during low demand periods and decrease during high demand periods.

What is aggregate production planning?

Aggregate production planning is concerned with the determination of production, inventory, and work force levels to meet fluctuating demand requirements over a planning horizon that ranges from six months to one year. Typically the planning horizon incorporate the next seasonal peak in demand.

What are examples of aggregate planning?

Some examples of aggregate planning are hiring temporary workers, laying off employees for a specific period or cross-training. This works as an effective benchmark to measure resource utilization and implementation.

What is aggregate planning in production and operations management?

Aggregate planning is a marketing activity that does an aggregate plan for the production process, in advance of 6 to 18 months, to give an idea to management as to what quantity of materials and other resources are to be procured and when, so that the total cost of operations of the organization is kept to the minimum …

What do you mean by aggregate planning?

Aggregate planning is a method for developing an overall manufacturing plan that ensures uninterrupted production at a facility. Aggregate production planning typically is applied to a 3- to 18-month period.

What are the types of production strategies?

Here are six of the different types of production strategies:

  • Assemble-to-order. Assemble-to-order (ATO) is a production strategy where companies produce products on a customer-order basis, storing their inventory as assembly-ready components.
  • Level production.
  • Chase strategy.
  • Make-to-stock.
  • Make-to-order.
  • Engineer-to-order.

What are the different types of production strategies?

Types of Production Strategies –

  • 1) Cost Rationalization.
  • 2) Product Differentiation.
  • 3) Pricing.
  • 4) Quality.
  • 5) Market Diversification.
  • 6) Delivery.
  • 7) Mix or flexible.
  • 8) Excellent pre and post-sales service.

What are the steps in aggregate planning?


  1. Step 1 Identify the aggregate plan that matches your company’s objectives: level, chase, or hybrid.
  2. Step 2 Based on the aggregate plan, determine the aggregate production rate.
  3. Step 3 Calculate the size of the workforce.
  4. Step 4 Test the aggregate plan.

Why do you need aggregate production planning?

The goal of aggregate planning is to minimize operating costs by matching production demand with production capacity. An aggregate plan specifies what materials and other resources are needed and when they should be procured to minimize cost.

What is aggregate production planning explain the components of aggregate production planning?

What are objectives of aggregate production planning?

What do you understand by aggregate planning?

Why is aggregate production planning necessary?

What is aggregate planning process?

Aggregate planning refers to the process of developing, maintaining, and analyzing the approximate scope of the operations of a company. It usually contains targeted sales forecasts, inventory levels, and production levels.

What are the 3 level of product?

The Three Product Levels

  • Core Benefit. The core benefit is the fundamental need that the customer satisfies when they buy the product.
  • Actual Product. The actual product is the product features and its design.
  • Augmented Product. The augmented product is any non-physical parts of the product.
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