Demand Forcast for FlexMan

Month

Routers

Switches

January
February
March
April
May
June
July
August
September
October
November
December

1,800
1,600
2,600
2,500
800
1,800
1,200
1,400
2,500
2,800
1,000
1,000

1,600
1,400
1,500
2,000
1,500
900
700
800
1,400
1,700
800
900

Router
Materials cost/unit
Inventory holding cost/unit/month
Marginal cost of stockout/unit/month
Hiring and training cost/worker
Layoff cost/worker
Labor hours required/unit
Regular time cost/hour
Over time cost/hour
Marginal subcontracting cost/unit

Switch

2.0

1.0

700
1,000
0.3333
10.0
15.0
6

0.1667

Initial Workforce size

Maximum overtime per worker per mont
Starting inventory ('000s)
Ending inventory ('000s)

6300
20
100
100

Productivity loss during first two months

0.5

50
50

Aggregate Plan Decision Variables (demand, inventory, production in '000s)

Ht

Period

Lt

# Hired
0
1
2
3
4
5
6
7
8
9
10
11
12

Costs
Period

# Laid off

0
0
0
0
0
0
0
0
0
0
0
0
1197

Hiring
1
2
3
4
5
6
7
8
9
10
11
12

Total cost =

0
0
0
0
0
0
0
0
0
0
0
837,620
$

0
133
0
0
0
1064
0
0
0
0
0
0
0

Wt

# Workforce
6,300
6,167
6,167
6,167
6,167
5,103
5,103
5,103
5,103
5,103
5,103
5,103
6,300

Lay off
Regular time
132,708
9,867,667
0
9,867,667
0
9,867,667
0
9,867,667
1,063,892
8,165,440
0
8,165,440
0
8,165,440
0
8,165,440
0
8,165,440
0
8,165,440
0
8,165,440
0
10,080,000

131,555,078

Ot

Router

Switch

Router

Overtime Inventory Inventory Stockout

0
100
50
0.0
0.0
767.2
0.0
0.0
1884.6
0.0
0.0
0.0
123345.8
0.0
0.0
0.0
0.0
504.3
0.0
0.0
0.0
0.0
0.0
1296.9
0.0
0.0
1993.3
102068.0
0.0
0.0
102068.0
0.0
0.0
0.0
0.0
0.0
0.0
100.0
50.0

Overtime
0
0
0
1,850,187
0
0
0
0
1,531,020
1,531,020
0
0

0
0
0
0
0
0
0
0
0
0
0
0
0

Inventory Stockout Subcontract

767,200
0
0
1,884,600
0
0
0
0
0
0
0
2,530,445
504,336
0
0
0
0
0
1,296,864
0
0
1,993,328
0
0
0
0
0
0
0
8,673,111
0
0
0
250,000
0
0

Switch

Router

Stockout Subcontract
0
0
0
0
0
0
0
0
0
0
0
0

0
0
0
0
422
0
0
0
0
0
1446
0
0

Router
Switch
Subcontract

Production
0
0
0
0
0
0
0
0
0
0
0
0

1700
1600
2600
2078
800
1800
1200
1400
2500
1354
1000
1100

Switch

Production
2517
2717
715
2500
1304
1296
2497
2096
507
2800
1000
1050

Router

Switch

Demand

Demand

1,800
1,600
2,600
2,500
800
1,800
1,200
1,400
2,500
2,800
1,000
1,000

1,600
1,400
1,500
2,000
1,500
900
700
800
1,400
1,700
800
900

Constraints

Router
Switch
Workforc
Inventory Inventory e
Overtime Production
0
0
0
0
0
0
0
0
0
0
0
0

0
0
0
0
0
0
0
0
0
0
0
0

0
0
0
0
0
0
0
0
0
0
0
0

123345.8
123345.8
123345.8
9.8E-008
102068
102068
102068
102068
-6E-008
9.9E-008
102068
114034

0.0
0.0
0.0
0.0
332221.3
0.0
0.0
0.0
0.0
0.0
316210.7
370238.7

7,000

6,000

5,000

4,000
# Hired
# Laid off
# Workforce

3,000

2,000

1,000

0
1

10

11

12

13

Router Production Plan

3000

2500

2000
Inventory
Production

1500

Demand
Third party production

1000

500

0
1

7
Month

10

11

12

Switch Production Plan

3000

2500

2000
Inventory
Production

1500

Demand
Third party production

1000

500

0
1

7
Month

10

11

12

Production vs. Demand by Month

3000

2500

2000
Router production
Sw itch Production

1500

Router demand
Sw itch demand

1000

500

0
1

7
Month

10

11

12