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Explain why Aggregate Planning and Master Scheduling factor into the overall Inventory Management process? How does it impact the business?


Aggregate Planning and Master Scheduling

            Aggregate planning and master scheduling represent two important aspects of business operations. The two aspects are important in business because they act as stimulants to the process of inventory management. The impact the inventory management process at two levels that include a comprehensive level and detail-oriented level. Aggregate planning achieves this through the use of strategic calculations, which construct the basic elements that include inventory operations decisions (Meyr, Wagner, & Rohde, 2015). It puts a lot of emphasis on resource allocation to match the forecasted supply and demand. The overarching objective is to ensure that expected demand is met based on a production plan that facilitates the efficient utilization of available organizational resources. Planners have to come up with decisions on inventory levels, employment levels, and changes, as well as output rates (Stevenson, 2014). Aggregate planning provides a mixture of strategies that allow the management of inventory process by outlining factors that include employee work hours, financial planning, and incorporation of flexibility to allow inventory to be built when production goes beyond demand and to be reduced when the demand is above production.


            The capacity for the management of inventory by aggregate planning is impacted by master scheduling. Master scheduling is best understood as an interface with marketing, production planning, capacity planning, and distribution planning that allows marketing to offer valid delivery commitments both to the warehouses as well as final customers (Malakooti, 2013). Aggregate planning deals with the creation of a framework for inventory management as well as concerns that are linked to supply and demand while master scheduling has its focus on capacity requirements. The latter also focuses on the communication of product manufacturing and distribution. It addresses other external components that relate to financial needs as well as concerns that are not captured by aggregate planning. Master scheduling, therefore, communicates the successes or failures of business operations that are set through aggregate planning.


Malakooti, B. (2013). Production and operation systems with multiple objectives. Hoboken, New Jersey: John Wiley and Sons Inc.

Meyr, H., Wagner, M., & Rohde, J. (2015). Structure of advanced planning systems. In Supply chain management and advanced planning (pp. 99-106). Springer Berlin Heidelberg.

Stevenson, W. J. (2015). Operations management. New York: McGraw-Hill Education.

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