Question

An event organizing company runs four events a year, once every 3 months. They have 20 full time employees, which are needed for the events. Recently the operating costs have been considered too high. Which aggregate planning model would you propose for them? Justify the benefits of that system over other methods (5 points). Give five recommendations for reducing the operational costs for the company (5 points).

Answer 1

In the given situation the best policy or planning model for the aggregate planning will be to implement the chase model. In the case of chase model the different employees and resources are hired as per the prevailing demand, when the demand is high, more resources are hired and when the demand is less, the resources are laid off.

The biggest benefit of this method will be that it will be able to help the company to manage its operating costs by changing the resources. The firm need not have the entire resources all the time, in fact, only the resources that are required to perform the business can be hired.

the following recommendations can be provided to manage the operational costs=

The firm needs to vary its manpower as per the demand

All the wasteful activities need to be identified and removed

The management and employees have to implement the concept of TQM to improve the quality and efficiency

Proper training has to be provided to the employees so that they can perform better

Better demand forecasting can help in controlling the wanted expenses.