An Aggregate Production Planning Strategy Selection Methodology based on Linear Physical Programming

Abstract

In this paper, a multi-objective model for aggregate production planning is presented which includes two objectives: (1) minimized cost and (2) minimized effect on the workforce motivation level caused by hire/layoff decisions. Then, six strategies are considered and the most appropriate one is determined to structure the plan. These strategies are set the regular time production quantities in a certain value which is unique for each. A preference based optimization method called Linear Physical Programming (LPP) is used to solve the model. A forecasting phase which chooses the convenient method to forecast the demand for planning horizon is embedded to study in addition to application of LPP to an APP model as another key contribution of this paper. Significance: This paper presents the application of a relatively new method -Linear Physical Programming - to the Aggregate Production Planning strategy selection process. This method provides a flexibility to decision makers in terms of expressing their preferences for the objectives.