Level capacity plan, Operation Management

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.

Posted Date: 1/30/2013 7:47:58 AM | Location : United States







Related Discussions:- Level capacity plan, Assignment Help, Ask Question on Level capacity plan, Get Answer, Expert's Help, Level capacity plan Discussions

Write discussion on Level capacity plan
Your posts are moderated
Related Questions
Organisation Development - Improving Productivity  The objectives of organisation development are to change systems, culture and behaviour in order to improve organisational e

The committee is asking you, as a labour relations specialist in the HR department, whether this wording is likely to be acceptable

Global expansion is fuelled by a (n): Answer (1) shrinking customer market, lower foreign labour costs, and advances in technology. (2) Expanding new customer market, lower foreign

What are some of the factors that cause organizations to redesign their products or services?

Evaluate alternative structures to determine which one would be most appropriate for Domino's to consider and discuss likely benefits Dominos would realize from adopting that struc

Transportation  Method We  solve the transportation  problem using the followings steps in order: a. Structuring the problem  into the  transportation  framework. b. Findi

You have just been asked to lead struggling Yahoo, just as Marissa Mayer stepped into the role. Discuss the steps you would take in the first few months of your leadership. Explain

Which strategy does this exemplify? Kayak and Orbitz provide their customers with a variety of travel options including flight reservations, vacation packages, flight and hotel opt

Question 1: (a) What does Organisational Behaviour mean to you? Use your own words to explain the concept. (b) Describe carefully the major challenges organizations are fa

Over the past year, Meredith and Smunt Manufacturing had annual sales of 10,000 portable water pumps. The average quarterly sales for the past 5 years have averaged: Spring 4,00