Supply Chain Strategy - Aggregate Planning

Aggregate Planning (AP) is an operational activity to determine the number and timing of future production at the time that would datang. AP also defined as an attempt to equate the supply and demand of a product or service by way of determining the number and timing of input, transformation, and output right. Where decisions are made for the production of AP, staffing, inventory, and backorder level.

Aggregate Planning (aggregate planning) also known as Aggregate scheduling is one approach that is usually done by the operations manager to determine the quantity and timing of production in the medium term (usually between 3 to 18 months ahead). Aggregate planning can be used in determining the best way to meet the predicted demand by adjusting the value of production, employment levels, inventory levels, work overtime, the level of subcontracting, and other variables that can be controlled. Scheduling decisions regarding the formulation of a plan that prioritizes the monthly and quarterly to match the productivity problem with fluctuating demand. Aggregate planning is therefore included in the medium-term plan.

Basically the purpose of aggregate planning is trying to obtain an optimal solution in a cost or benefit in the planning period. However, there are other strategic issues that may be more important than low cost. Strategic issues in question, among others, reducing the problems of employment levels, push inventory levels, or meet a higher level of service. For manufacturing companies, the aggregate schedule aims to connect the company's strategic objectives with production plans, but for service companies, aims to connect the target aggregate scheduling with employee schedules. There are four things required in the aggregate planning, among others: