Question

A firm uses the chase strategy of aggregate planning. It produced 1000 units in the last period. Demand in the next period is estimated at​ 800, and demand over the next six periods​ (its aggregate planning​ horizon) is estimated to average 900 units. Which of the following tactics would be most representative of following a chase​ strategy?

Answer 1

Chase strategy is refers as the company is chasing the demand set by the market. Chase strategy is matching the demand period by period.

So, Chase strategy can lead to considerable amount of hiring, firing so, insecurity of employee is common in Chase Strategy.

it is given that existing man power produced 1000 unit but the demand is reduced to 800 unit.

so, the company will offload the manpower to cover the difference between 1000 unit and 800 unit by 200 units