TOPIC 8

RESOURCE MANAGEMENT

• It deals with the planning, execution, and control of all the resources that are used to produce goods or provide services in a value chain.

  • Resources include materials, equipment, facilities, information, technical knowledge and skills, and people.

AGGREGATE PLANNING

It is the development of a long-term output and resource plan in aggregate units of measure.

DISAGGREGATION

A process of translating aggregate plans into short-term operational plans that provide the basis for weekly and daily schedules and detailed resource requirements.

EXECUTION

It refers to moving work from one workstation to another, assigning people to tasks, setting priorities for jobs, scheduling equipment, and controlling processes.

ENTERPRISE RESOURCE PLANNING

It integrates all aspects of a business – accounting, customer relationship management, supply chain management, manufacturing, sales, human resources – into a unified information system, and they provide more timely analysis and reporting on sales, customer, inventory, manufacturing, human resource and accounting data.

DEMAND MANAGEMENT

Marketing strategies can be used to influence demand and to help create more feasible aggregate plans.

PRODUCTION RATE CHANGES

One means of increasing the output rate without changing existing resources is throughplanned overtime. However, reduced overtime pay or sitting idle can seriously affect employee morale.

WORKFORCE CHANGES

Changing the size of the workforce is usually accomplished through hiring and layoffs. Both have disadvantages. Hiring additional labor usually result in higher costs for the personnel department and for training. Layoffs result in severance pay and additional unemployment insurance costs, as well as low employee morale.

INVENTORY CHANGES

In planning for fluctuating demand, inventory is often built up during slack periods and held for peak periods.

FACILITIES, EQUIPMENT AND TRANSPORTATION

These generally represent long-term capital investments.

LEVEL PRODUCTION STRATEGY

plans for the same production rate in each time period. It avoids changes in production rate, working within normal capacity restrictions.

CHASE DEMAND STRATEGY

sets the production rate equal to the demand in each time period. Although inventories will be reduced and lost sales will be eliminated, many production rate changes will dramatically change resource levels.

MASTER PRODUCTION SCHEDULING

It is a statement of how many finished items are to be produced and when they are to be produced.

MASTER REQUIREMENTS PLANNING

It is a forward-looking, demand-based approach for planning the production of manufacturing goods and ordering materials and components to maximize unnecessary inventories and reduce costs.

CAPACITY REQUIREMENTS PLANNING

It is a process of determining the amount of labor and machine resources, required to accomplish the tasks of production on a more detailed level, taking into account all component parts and items in the materials plan.