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30 Cards in this Set

  • Front
  • Back
Sales and Operations Planning
A business process that helps firms plan and coordinate operations and supply chain decisions over a tactical time horizon (usually 4 to 12 months)Same as Tactical planning.
strategic planning
Planning that takes place at the highest levels of the firm, addressing needs that might not arise for years into the future.
Tactical Planning
Planning that covers a shorter period, usually four months to a year, although the planning horizon may be longer in industries with very long lead times such as engineer-to-order firms.
Detailed planning and control
Planning that covers time periods ranging from weeks, down to just a few hours out into the future.
Top-Down Planning
an approch to S&P where a single, aggregated sales forecast drives the planning process. For top-down planning to work, the mix of products or services must be essentially the same from one time period to the next, or the products or services to be provided must have very similar resource requirements.
Bottom-up Planning
An approach to S&OP that is used when the product/service mix is unstable and resource requirements vary greatly across the offerings. Under such conditions, managers will need to estimate the requirements for each set of products or services separately and then add them up to get an overall picture of the resource requirements.
Planning Values
Values that decision makers use to translate the sales forecast into resource requirements and to determine the feasibility and cost of alternative sales and operations plans.
Level production plan
a sales and operations plan in which production is held constant and inventory is used to absorb differences between production and the sale forecast.
Chase Production planning
Plan in which production is changed in each time period to match the sales forecast.
Mixed production plan
plan that varies both in production and inventory levels in an effort to develop the most effective plan.
Load Profile
A display of future capacity requirements based on released and/or a given span of time.
Net Cash Flow
The net flow of dollars into or out of a business over some period of time.
Tiered workforce
A strategy used to vary workforce levels, where additional full-time or part time employees are hired during peak demand periods, while a smaller, permanent staff is maintained year-round.
a strategy for reducing and smoothing out workforce requirements by having the customers perform part of the work themselves.
optimization models
a class of mathematical models used when the user seeks to optimize some objective function subject to some constraints.
objective function
a quantitative function that an optimization model seeks to optimize. maximize or minimize
quantifiable conditions that place limitations on the set of possible solutions. the solution to an optimization model is acceptable only if it does not break any of the constraints.
The three approaches to planning, Detailed, Tactical, and Strategic differ in?
1)the time covered
2)the level of planning detail required
3)the degree of flexibility managers have to change capacity
Aspects of Detailed planning and control are?
Limited ability to adjust capacity
detailed planning (day to day, hour to hour)
Lowest risk, Specific products and times, scheduling of people and equipment,
Also known as short-range plans
Aspects of Tactical Planning are?
-Workforce, inventory, subcontracting, and logistics decisions
Planning numbers somewhat “aggregated” (month to month)
Moderate risk
Aspects of Strategic planning are?
“Bricks and mortar” and major process choice decisions
Planning done at a very high level (Product and process)
(quarterly or yearly)
High risk
Also called long-range plans
Top down planning consists of three steps what are they?
1) Develop the aggregate sales forecast and planning values.
2) Translate the sales forecast into resource requirements(Personnel, equipment, Materials)
3) Generate alternative production plans( Chase, level, mixed)
What are the three phases of implementing Sales and operations planning?
1)Developing the foundation
2)Integrating and streamlining the process
3)gaining a competitive advantage
What are the key steps in developing the foundation?
Educating all participants about the benefits of s&op, identifying the appropriate product or service families to plan around, and establishing the information systems needed to provide accurate planning values.
Two options for aligning resources with demand are?
Making sales match capacity, and making capacity match sales.
Yield management
An approach commonly used by services with highly perishable products in which prices are regularly adjusted to maximize total profit.
sales and operations planning purpose
select capacity options over the intermediate time horizon.
What are the capacity options for sales and operations planning?
Inputs to the process of sales and operations planning
Strategic capacity levels
Demand management
External Capacities
Sales and operations planning consists of
Monthly meetings by senior management
Evaluates supply, demand, cash flow for future periods
Aligns tactical plans- consensus on single operating plan
Allocates critical resources of people, capacity, materials, time and money.