aggregate planning

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An approach to planning that enables overall output levels and the appropriate resource input mix to be set for related groups of products over the near to medium term. Thus the aggregate plan for a car factory would consider the total number of units produced per month, but would not be concerned with the scheduling of individual models, colours, standards of finish, engine sizes, etc. It would be concerned with the labour and machine hours available in a given period but not with what each machine would be doing at a particular time. Aggregate planning assumes that the product/service mix remains stable over the period of the plan and that the capacity remains fixed, i.e. that problems cannot be solved by bringing new plant on stream within the timescale of the plan. Aggregate planning may also seek to influence demand through such variables as price, advertising, and the product mix.

Subjects: Business and Management.

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