solution

a – c. Gestalt’s Gadgets has forecasted the demand for the Gadget 2000 for the next six weeks as follows:

Week	1	2	3	4	5	6
Demand forecast	220	200	220	200	220	180

a.Given a starting on-hand inventory of 40 units of Gadget 2000, determine the minimum amount/rate of production required for a “Mixed” (i.e., level production with inventory) strategy to satisfy the total demand over the next six weeks with no backlogs. And then show the required production (i.e., S&OP) plan (using a table as shown below), including estimating the inventory levels (for both starting and ending) for each of the next six weeks. (Please use a blank sheet to show your work for all three [a, b, and c] questions and upload it back into Canvas here.)

Week	1	2	3	4	5	6
Starting inventory
Demand forecast	220	200	220	200	220	180
Production
Ending inventory

b.Marketing department has just updated the forecast. Week 4 forecast has decreased to 180 from 200, and Week 6 increased to 200 from 180 (but, the six-week total remains unchanged). Show your revised “Mixed” plan that meets all the conditions (e.g., minimum production amount to satisfy the total demand over the six weeks with no backlogs). Show the required production (S&OP) plan (using an updated table as shown below), including a new/updated minimum production rate (if necessary), and inventory levels (both starting and ending) for each of the next six weeks.

Week	1	2	3	4	5	6
Starting inventory
Demand forecast	220	200	220	180	220	200
Production
Ending inventory

c.The owner of Gestalt reviews the “Mixed” plan from (b) and decides that she would rather have a “Chase” plan using the same starting inventory of 40 units and requiring a fixed buffer inventory (i.e., safety stock) of 15 units. Using the updated demand forecast from (b), show the required production (“Chase”) plan, including (both starting and ending) inventory levels, for each of the next six weeks.

Week	1	2	3	4	5	6
Starting inventory
Demand forecast	220	200	220	180	220	200
Production
Ending inventory