ABSTRACT
Ottoman Co. is the only major producer of furniture in their small town with a population of around 70,000. They design and manufacture various pieces of furniture, ranging from elaborately designed and crafted heavy pieces of furniture, to the more contemporary and trendy simple modern products. Ottoman Co. faces complex production planning decisions because they are a small-sized workshop that manufactures a high variety of products. Each product manufactured in the workshop requires a specific sequence of processes and steps that uses a subset of resource. The practice is that when an order is due, or when there is a rush order, they ‘borrow’ the required resources for that order from other orders, until they finish the high-priority order and hand it to the customer. The business owners suspect that this constant reallocation of resources in the middle of operations and the constant breaking of machine set-ups partially cause the large piles of work in process inventory.
