Integration of machine requirements planning and aggregate production planning

Although machine requirements planning and aggregate planning problems have been treated as separate areas of research, the two are closely related in most production environments. This article presents a mathematical programming model that concurrently encompasses the two areas. The integrated model incorporates production and workforce planning decisions with equipment procurement decisions. Our evaluations indicate that the integrated model has cost-saving advantages over the individual aggregate planning and machine planning models. Furthermore, the integrated model allows the analyst to evaluate various production alternatives, each having a different ratio of operator/machine contribution to production. This makes the model useful for assessing the attractiveness of various degrees of automation in manufacturing of a product. The article starts with a brief background review of machine requirements planning and aggregate production planning. We then discuss the significance of combining the two planning problems and present an integrated model. The paper ends with an example which demonstrates the usefulness of the model and highlights the importance of integrating the two areas.