inventory planning and control

action? CASE STUDY 3.1 Acme Water Pumps The Acme Water Pump company has a problem. The pumps are fairly expensive to make and store, so the company tends to keep the inventory low. At the same time, it is important to respond to demands quickly, since a customer who wants a water pump is very likely to get one from a competitor if Acme doesn't have one available immediately. Acme's current policy to produce pumps is to produce 100 per week, which is the aver- age demand. Even this is a problem, as the production manager has pointed out, since the equipment is also used for other products and the lot size of 300 would be much more efficient. He said he is currently set up for water pump production for the next week and states that he has capacity available to produce 300 at a time next week. Master Scheduling 67 The following lists the forecasts and actual customer orders for the next 12 weeks Week Forecast Customer Orders 1 90 105 23 45 120 110 80 85 97 93 72 98 6 95 72 7 100 53 8 110 21 9 90 17 10 90 6 11 100 2 12 110 5 The president of Acme has said that he wants to consider using a formal MPS with ATP logic to try to meet demand more effectively without a large impact on inventory. Acme has decided to use a demand time fence at the end of week 3 and has also found out that its current inventory is 25 units. Assume Acme will use the MPS lot size of 300 and that it will produce the first of those lots in week 1. Assignment 1. Develop a master schedule using the information above. 2. A customer has just requested a major order of 45 pumps for delivery in week 5. What would you tell the customer about having such an order? Why? What, if any- thing, would such an order do to the operation