AGGREGATE AGGREGATE PLANNING IN PLANNING IN

SERVICES AND YIELD SERVICES AND YIELD MANAGEMENTMANAGEMENT

Pablo de Olavide University, Seville. 6th March, 2015Subject: Operations Management IIStudents: Beatriz Piedras Martínez Javier Ocaña Infante María Nocete Luján

Aggregate planning in servicesAggregate planning in services

Cost ControlCost Control

RESTAURANTSRESTAURANTS

HOSPITALSHOSPITALS

Meet changing demand of patients by allocatingMeet changing demand of patients by allocating

NATIONAL CHAINS OF SMALL NATIONAL CHAINS OF SMALL SERVICE FIRMSSERVICE FIRMS

MISCELLANEOUS SERVICESMISCELLANEOUS SERVICES

Brief ExampleBrief Example

Klasson and Avalon, a medium – size law firm of 32 legal professionals, wants to develop an Aggregate Plan for the next quarter. The firm has developed 3 forecasts of billable hours for the next quarter for each 5 categories of legal services they provide. The 3 forecasts have been named as ‘best, likely and worst’. If we assume 40 – hour workweek and that a 100% of each lawyers’ hours are billed, we obtain about 500 billable hours from each lawyer this fiscal quarter.

Forecasted Demand for each Scenario Forecasted Demand for each Scenario (Best, Likely, Worst)(Best, Likely, Worst)

Lawyers needed (workforce) Lawyers needed (workforce) = Total hours/billable hours per lawyer for the quarter

Once we have forecasted the Workforce needed for the quarter (or for any period of time the wording of the exercise requires), we need to follow the steps for ‘Chase Strategy’, ‘Level Strategy’ and ‘Mixed Strategy’ in order to obtain the Total Costs for the period. If the wording doesn’t say anything about which strategy is going to be carried out, we have to compute all the strategies in order to compare the TC we obtain, and choose the less costly strategy.

YIELD MANAGEMENTYIELD MANAGEMENTAIRLINE INDUSTRYAIRLINE INDUSTRY

Passengers that need to be serviced in all flights.

Schedule for number of

flights on all routes.

Personnel required on each plane and site.

How many seats to

allocate to different fare

All of these factors make for a more complex aggregate planning method

YIELD YIELD MANAGEMENTMANAGEMENT

YIELD MANAGEMENTYIELD MANAGEMENT

Yield management example :Yield management example :

Cruise ship with maximum number of 1000 cabins.

Avarage number of cabins used 400 cabins.

Cabins are identical

Price 1200€.

Yield management example:Yield management example:

Yield management example:Yield management example:

Yield management:Yield management:

Iberia example: Iberia example:

Iberia example:Iberia example: