ABSTRACT
Planners need to evaluate production factors such as cost, labor, equipment, materials, and processes while setting up a master production plan. The aggregate operations planning optimization model provides a comprehensive view for the manufacturing environment with the aim of reducing costs and enhancing productivity and efficiency. A strategy for making choices, aggregate operations planning helps a company in figuring out the quantities of various production factors, such as workforce and inventory. Literature on the aggregate operations planning problem shows that it is applicable for a 3 – 18-month planning horizon, although the time window may be altered to suit any time unit.
Multiple researchers have offered a variety of techniques to aggregate production planning problem based on a company's supply capacity and external demand, since the primary assumption of aggregate operations planning is to match supply and demand. There are quantitative techniques, including graphical and spreadsheet models, for resolving the challenges of aggregate operations planning. A linear optimization adaptation of the aggregate production planning model was developed in the 1960s, igniting a renaissance in managing operations.
The family of aggregate operations planning models aims to match supply and demand within a time range specified by the planning horizon to minimize expenses connected with a company's manufacturing or production activities. The linear optimization model of the aggregate production planning matches the supply and demand within a time range given by the production planning horizon and strives to minimize overall manufacturing expenses. Therefore, aggregate operations planning belongs to the strategic aspect of the planning and control framework, which also includes long- and medium-term external capacity and inventory planning activities, demand forecasting and finance planning.
