Level capacity plan, Operation Management

Assignment Help:

Level Capacity Plan

The inventory size is varied keeping the workforce size and utilization of work constant. The number of workers ( working size) is kept constant throughout the time period under consideration. During months of low demand the excess units required over the units produced are taken from the inventory. The benefit of this plan is that the cost of hiring and training new. Workers is zero. Also the cost of laying off workers is zero, as the workforce size is constant. The employee morale is high due to sense of job security. During periods of low demand, there is a high inventory cost due to its large size.

2427_Level  capacity plan.png

Figure: Level Capacity Plan

Figure shows the level capacity plan of a company manufacturing a product on produce to stock and sell basis. In the first quarter aggregate demand is less than production and inventory builds up till the end of the First Quarters . in the second third and fourth quarters are inventory levels Decline because production is less than the aggregate demand. In the fifth Quarter the production is more than the aggregate demand and hence Inventory builds up again.


Related Discussions:- Level capacity plan

Explain manufacturing budget, Explain manufacturing budget. Manufacturi...

Explain manufacturing budget. Manufacturing budget needs the following fundamental budgets or estimates to meet the plans:- (i) To be manufactured, production budget outlini

Describe what is customer relationship management, What is Customer Relatio...

What is Customer Relationship Management? Describe the four-step framework for one-to-one marketing that can be adapted to CUSTOMER RELATIONSHIP MANAGEMENT marketing?

Why is the eoq model important, 1. The annual demand for university student...

1. The annual demand for university students style note pads is 10,000 units. The supplier operates the business 300 days per year and delivers over five working days. Calculate th

How much dollars of pipeline inventory will be in transit, Prince Electroni...

Prince Electronics, a manufacturer of consumer electronic goods, has five distribution centres in different regions of the country. For one of its products, a high-speed modem pric

Explain what steps can ford motor take, The United Auto Workers union enter...

The United Auto Workers union enters into contract negotiations with the Ford Motor Company in Michigan. What are the three main subject areas the UAW can negotiate with Ford? Prov

Depict a histogram and pareto chart, Create a Histogram and Pareto Chart fo...

Create a Histogram and Pareto Chart for each of the following categories using data provided Fan satisfaction survey results (N=250) Gameday: Parking A:90 B:105 C: 45 D: 5

Explain profits and time based competitiveness, Small businesses have been ...

Small businesses have been slower to integrate information technology into their operations than larger companies. Discuss the reasons for this state of affairs, identifying severa

Explain store marketing, Please answer this question: You work in the suppl...

Please answer this question: You work in the supply chain department for a consumer goods company. You have recently expanded globally shipping goods to a nation where it is custom

Define how information systems affect business careers, How does business o...

How does business obtain the ability to assimilate, synthesize, and apply the concepts of management information systems; specifically how information systems transform business; h

Explain requirements to offer someone a top manager position, Which are you...

Which are your top 10 requirements to offer someone a top manager position?

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd