Medium-term demand management projections are used primarily to:

Medium-term demand management projections are used primarily to:
A . complete strategic business planning of facilities.
B . complete forecasts at the item level.
C . aggregate demand for production planning.
D . develop the master production schedule.

View Answer

Answer: C

Explanation:

Medium-term demand management projections typically cover a horizon of several months to a few years and are essential for production planning. Here’s the detailed Explanation.

Aggregate Demand: Medium-term projections aggregate demand at a higher level, such as product families or groups, to facilitate production planning and capacity management.

Production Planning: These projections are used to plan production schedules, workforce requirements, and resource allocation, ensuring that manufacturing operations can meet anticipated demand.

Inventory Management: Helps in maintaining optimal inventory levels by balancing supply and demand over the medium term.

Alignment with Business Goals: Ensures that production plans are aligned with the company’s strategic goals and market demands.

While medium-term projections also support other activities, such as developing the master production schedule (MPS), their primary use is in aggregating demand for effective production planning.

Reference: Vollmann, T. E., Berry, W. L., Whybark, D. C., & Jacobs, F. R. (2005). Manufacturing Planning and Control for Supply Chain Management. McGraw-Hill.

Chopra, S., & Meindl, P. (2016). Supply Chain Management: Strategy, Planning, and Operation. Pearson.