125% T Format Organize Zoom Table Chart Shape Collaborate View Add Category Insert Text Media Comment Chase strategy Level strategy Mixed strategy Comparison Chapter 11: Capacity Planning Assignment 2 of 3: How many workers do I need? LAWNKING Aggregate Planning Refer to the LawnKing Case study in Part Seven of the text, with the updated data shown here. Use your BEST forecasted sales computed previously in Assignment 1 for this assignment. Then, compute all three options shown below. Finally, compare them all on the last sheet. BASIC INPUT DATA DATE : OPTIONS: MONTHLY PROD. RATE (UNITS/WORKER/MONTH ) : 82 UNITS 1) Chase Strategy BEGINNING INVENTORY (UNITS) : 1 , 225 UNITS 2) Level Strategy BEGINNING NUMBER OF WORKERS : 80 WORKERS 3) Mixed Strategy HIRING COST PER WORKER: $1, 200 PER HIRE LAYOFF COST PER WORKER: $1, 500 PER FIRE COST OF FULLY ASSEMBLED PRODUCT (AVE $) $179 PER UNIT INVENTORY HOLDING COST (8 of value per year) : 28% ANNUALLY Notes on Chase Strategy INVENTORY SHORTAGE COST ( COST/UNIT SHORT) : $25. 00 PER BACKORDER PER MONTH - only make as many items as needed each month REGULAR HOURLY WAGE RATE: $15. 30 PER WORKER - end the year with the same number in inventory as you started OVERTIME HOURLY WAGE RATE: $23.00 PER WORKER only full-time employees allowed (i.e. whole-number of workers) OPERATING TIME: (HOURS/WEEK) 40 HOURS PER WEEK MONTHS : Jan Feb Mar Apr May Jun Jul Aug sep Oct Nov Dec ANNUAL 0 Sales Forecast: Number of Workers: 0 Units Produced: Ending Inventory: 1 , 225 1, 225 1, 225 1, 225 1, 225 1, 225 1, 225 1, 225 1, 225 1 , 225 1 , 225 1 , 225 Reg. Labor Costs: so SO SO $0 SO so SO SO $0 $0 Change in # workers from last month: 0 -80 0 0 0 0 0 0 0 0 0 0 Hiring Cost: $0 $0 $0 $0 $0 $0 $0 $0 $0 Layoff Cost: $120, 000 so $0 so $0 SO $0 so $0 $5 , 116 $5 , 116 $5 , 116 $5 , 116 $5 , 116 $5 , 116 $5 , 116 $5 , 116 $5 , 116 $5 , 116 $5 , 116 $5 , 116 End-Inv. Hold. Cost: $0 $0 SO SO SO $0 End-Inv. Short. Cost: $0 SO MONTHLY TOTAL COST: $125, 116 $5, 116 $5 , 116 $5 , 116 $5 , 116 $5 , 116 $5 , 116 $5 , 116 $5 , 116 $5 , 116 $5 , 116 $5 , 116125% E T View Zoom Add Category Insert Table Chart Text Shape Media Comment Collaborate Format Organize + Chase strategy Level strategy Mixed strategy Comparison LAWNKING Aggregate Planning BASIC INPUT DATA DATE : OPTIONS MONTHLY PROD. RATE (UNITS/WORKER/MONTH ) : 82 UNITS 1) Chase Strategy BEGINNING INVENTORY ( UNITS ) : 1, 225 UNITS 2) Level Strategy BEGINNING NUMBER OF WORKERS: 80 WORKERS 3) Mixed Strategy HIRING COST PER WORKER: 1, 200 PER HIRE LAYOFF COST PER WORKER: 1 , 500 PER FIRE COST OF FULLY ASSEMBLED PRODUCT (AVE $ ) 179 PER UNIT INVENTORY HOLDING COST ($ of value per year) : 28% ANNUALLY Notes on Level Strategy INVENTORY SHORTAGE COST (COST/UNIT SHORT) : 25 .00 PER BACKORDER PER MONTH - workers must be the same EVERY month Y WAGE RATE: 15 . 30 PER WORKER - end the year with the same number in inventory as you started OVERTIME HOURLY WAGE RATE: 23.00 PER WORKER - only full-time employees allowed (i.e. whole-number of workers) OPERATING TIME: (HOURS/WEEK) 40 HOURS PER WEEK MONTHS : Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec ANNUAL Sales Forecast: Number of Workers : Units Produced: Ending Invent 1, 225 1 , 225 1, 225 1 , 225 1 , 225 1, 225 1, 225 1, 225 1, 225 1, 225 1, 225 1, 225 Reg. Labor Costs: SO SC SO $0 $0 $0 SO $0 $0 SO SC SO e in # workers from last month: -80 0 0 0 0 0 0 0 0 0 0 0 Hiring Cost: SO SO SC $0 $0 SO $0 SO $0 SO $0 Layoff Cost: $120 , 000 SO SO SO SO SO SO SO SO SO SO End-Inv. Hold. Cost: $5 , 116 $5 , 116 $5 , 116 $5 , 116 $5 , 116 $5 , 116 $5 , 116 $5 , 116 $5 , 116 $5 , 116 $5 , 116 $5 , 116 SO SO SO SO SO SO End-Inv. Short. Cost: MONTHLY TOTAL COST: $125 , 116 $5 , 116 $5 , 116 $5 , 116 $5 , 116 $5 , 116 $5 , 116 $5, 116 $5 , 116 $5 , 116 $5 , 116 $5 , 116 $181, 397 TOTAL COST OF THIS STRATEGY125% T View Collaborate Format Organize Zoom Add Category nsert Table Chart Text Shape Media Comment + Chase strategy Level strategy Mixed strategy Comparison LAWNKING Aggregate Planning BASIC INPUT DATA DATE : OPTIONS: MONTHLY PROD. RATE ( UNITS/WORKER/MONTH ) : 82 UNITS 1) Chase Strategy BEGINNING INVENTORY (UNITS) : 1 , 225 UNITS 2) Level Strategy BEGINNING NUMBER OF WORKERS : 80 WORKERS 3) Mixed Strategy HIRING COST PER WORKER: $1, 200 PER HIRE LAYOFF COST PER WORKER: $1, 500 PER FIRE COST OF FULLY ASSEMBLED PRODUCT (AVE $ ) $179 PER UNIT Note 1: You can see the solution method under DATA tab, SOLVER. It's all ready for you! INVENTORY HOLDING COST (8 of value per year) : 28% ANNUALLY Note 2: If you don't have SOLVER listed, add it under FILE, OPTIONS, MANAGE ADD-INS. GO. Check the SOLVER TOOLS INVENTORY SHORTAGE COST ( COST/UNIT SHORT) : $25. 00 PER BACKORDER PER MONTH REGULAR HOURLY WAGE RATE: $15. 30 PER WORKER Note 3: The optimal solution with fractional workers -- leave this as the optimal (e.g. considers part- time or temporary workers). If needed, compare results to that of only full-time workers by rounding or add an Integer constraint. OVERTIME HOURLY WAGE RATE: $23.00 PER WORKER OPERATING TIME: ( HOURS/WEEK) 40 HOURS PER WEEK MONTHS : Jan Feb Mar Apr May Jun Jul Aug Sep oct Nov Dec ANNUAL 0 Sales Forecast: 0 0 0 0 0 Number of Workers: Units Produced: Ending Inventory: 1 , 225 1 , 225 1, 225 1 , 225 1, 225 1, 225 1, 225 1 , 225 1 , 225 1, 225 1 , 225 1, 225 Reg. Labor Costs: so SO SO SO $0 so Change in # workers from last month: -80 . 0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0. 0 0.0 0.0 0.0 Hiring Cost: $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 Layoff Cost: $120 , 000 $0 $0 $0 $0 SO $0 $0 $0 $0 End-Inv. Hold. Cost: $5 , 116 $5 , 116 $5 , 116 $5 , 116 $5 , 116 $5 , 116 $5 , 116 $5 , 116 $5 , 116 $5 , 116 $5 , 116 $5 , 116 End-Inv. Short. Cost: $0 $0 SO $0 $0 SO MONTHLY TOTAL COST: $125, 116 $5 , 116 $5, 116 $5 , 116 $5 , 116 $5 , 116 $5 , 116 $5 , 116 $5 , 116 $5 , 116 $5 , 116 $5 , 116 $181, 397 TOTAL COST OF THIS STRATEGY125% EE T Format Organize Table Text Shape Media Comment Collaborate View Zoom Add Category Insert Chart + Chase strategy Level strategy Mixed strategy Comparison Write in Pro's and Con's, as related to each topic below: LAWNKING Aggregate Planning Inventory Policy Employment policy Method Cost of Method Avoiding Stock-outs Excess Inventory Workers Point-of-View Company Point-of-View Chase $181,397 Level $181,397 Mixed $181,397 Which method would you recommend??? Why???? 141