Question

Rita's Ice Cream in Jacksonville Beach currently employs 7 staff who work 140h per month each. The

expected demand over summer months is listed in the tables below.
a) Please fill out the S&OP using a chase strategy.

b) Please fill out the S&OP using a level strategy. The overtime constraint is 40h per staff per month. A onetime adjustment of workforce at the beginning of the planning period is possible.

Answer 1

The S&OP can be filled out using either a chase strategy or a level strategy. The chase strategy adjusts the workforce to match the demand, while the level strategy maintains a consistent workforce and utilizes other methods to meet fluctuating demand.

Step-by-step explanation:

The S&OP, or Sales and Operations Planning, is a process that helps businesses align their sales and production plans to meet customer demand. The two commonly used strategies in S&OP are the chase strategy and the level strategy.

a) Chase Strategy:

In the chase strategy, the business adjusts its workforce to match the level of demand. In this case, Rita's Ice Cream would adjust its staff count each month based on the expected demand. Let's fill out the S&OP using this strategy:

• Month 1: Demand - 2000 units, Staff count - 7
• Month 2: Demand - 4000 units, Staff count - 14
• Month 3: Demand - 6000 units, Staff count - 21

b) Level Strategy:

In the level strategy, the business maintains a steady workforce throughout the planning period and utilizes inventory or subcontracting to meet fluctuating demand. Let's fill out the S&OP using this strategy:

• Monthly average demand: (2000 + 4000 + 6000) / 3 = 4000 units
• Monthly average staff requirement: 4000 units / 140h = 28.57 staff
• Rounding up to the nearest whole number, the business would maintain a staff count of 29 throughout the planning period.

Note: Both strategies can be adjusted to account for the overtime constraint if needed.