Macpherson Refrigeration Limited

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Case Study “MacPherson Refrigeration Limited” Mohamed Yehia Emam (S1500733) George Gabriel George (S1501034) Table of Contents Table of contents Page 2 1. Introduction Page 3 2. Problem Statement Page 3 3. Performance Measures and Trade-Offs Page 4 4. Assumptions Page 5 5. Iterative Plan Page 5 5.1. Integer Programming Model Page 5 5.2. Integer Programming Model Considering Overtime Page 6 5.3. Integer Programming Model Considering Hiring/Firing Page 7 6. Conclusion Page 9 1. Introduction In this case study, production planning of MacPherson Refrigeration Limited (MRL) for the next year is conducted. In order to…show more content…
The decision maker of the project who is going to decide to implement the provided solution is Linda Metzler, production planning manager of MRL. Her objective is minimizing the cost while keeping the reputation of the company at high levels considering the future of the company. Her decision criteria and performance measures are in detail in the next part and environment related assumptions are described in assumptions. 3. Performance Measures and Trade-Offs In order to compare the different aggregate plans, there should be some performance measures in accordance with the objectives of decision maker. These measures would be used in order to define a plan as “better” than any other plan and they are grouped according to their relevancies in parts. The first tool to compensate demand fluctuation is building inventory as given in the case text. Quantitative trade-off of this tool is basically the opportunity cost of holding inventory which is given as $8 per unit per month. In addition, keeping products for long time intervals in inventory could lead them to hold outdated products which can be though both quantitative and qualitative trade-off. Considering that these aspects should have been included in the inventory holding cost; no additional modification related to these trade-offs are considered. The second mentioned tool is using overtime which is considered as making some of workers work for an additional 40 hours a week. The obvious benefit of

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