IME 410 Exam 1 Latest Version with Certified Solutions

IME 410 Exam 1 Latest Version with Certified Solutions Production Plan Definition Annual (Y) - Quarter (Q) - Monthly (M) Aggregate plan deals with groups/families of products sets mfg. rates and labor size capacity resource requirements expansion/reduction of logistics system Top management responsibility Production Plan Strategy - Level Good anticipation/visibility Same PP for each period Production Plan Strategy - Chase Controls on-hand inventory Keep inventory constant and follow forecast Production Plan Equation BTS PP=Forecast+End Inv-Beg Inv Production Plan Equation BTO PP=Forecast+Beg Backlog-EndBacklog Forecast Stability More forecast than sales causes excess inventory Forecast Responsiveness More sales than forecast causes shortage need overtime to make up difference Moving Averages n=x (Period1+Period2+....Periodx)/x n increases, stability increases but responsiveness decreases MAD § MAD = [sum|Di - Fi|]/n Sales-forecast "On average we have this much error" Exponential Smoothing Technique Fi = α Si-1 + (1-α)Fi-1 alpha*lastsales + (1-alpha)*lastforecast alpha values alpha = 0 - stable forecast alpha = 1 - responsive forecast on last periods sales alpha 0.3 for volatile demand patterns alpha 0.8 for real upward, downward trends As Alpha decreases Stability increases