Macpherson Refrigeration Limited Case Study

Case Title: MacPherson Refrigeration Limited

Name and ID:

Who: MacPherson Refrigeration Limited, Linda Metzler (Production Planning Manager)

What: How to optimize Yearly Production Planning

Why: Due to the expanding company growth, as well for financial gain/optimization

When: New Aggregate plan due: October 31, 20X1

Implementation new plan: January 1, 20X2 – December 31, 20X2

A. Issues

Immediate Issues

1. Greater product line leading to a buildup in inventory stock which costs more money to store

2. Limiting Hiring and Layoffs to meet with Peak Demand

3. Limiting Overtime requirements to meet demand as well as keep worker morale up.

Basic Issues

1. Ongoing fluctuation in demand

2. Reducing company costs while retaining a high company status and repertoire with employees.

B. Case Data Analysis

Causes and Effects

Every year in September, MacPhersons Refrigeration Limited (MRL), creates a forecasted production

plan for the coming year. In doing so, this helps their business organize production and employee

projected costs for that year. The aggregate plans that are developed each year are used to minimize

costs (such as lowering inventory storage costs, layoff costs, hiring/training costs, and overtime) while

increasing employee morale (which increases production quality)

As these shipment forecast numbers are only but forecasts of what could happen, they are still subject

to change. This being said, the presented schedule could drastically change depending on consumer

demand.

Constraints and Opportunities

Constraints

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Unionized contract workers who are under a two year contract since February of the previous

year pose a constrain because if employees are unable to be laid off before the end of the

contract, they are a unnecessary expense to MRL

The hiring and Layoff cycles would affect the quality of work in which each employee

demonstrates. This will also limit the learning curve of the company to increase the...