Pelesia Tillman, Greg Hunter, Byron Gardner
May 23, 2014
Dr. Robert Smith
The Chase strategy is applied when the demand is not predictable during the year. This strategy is designed to match the demand of the product. The chase strategy is a part of Aggregate planning strategies. These strategies are made up of two groups the capacity oriented options and the demand oriented. Within the capacity oriented options lies the chase strategy. Team C will analyze chase strategies and challenges associated with using this approach. Team will also discuss three companies that use this approach and why is it the production strategy of choice.
The Chase Strategy varies the output rate to match the seasonal variations in demand. It does this by hiring and firing workers, utilizing overtime and idle time, subcontracting, and using part time workers. Basically this strategy will adjust capacity by hiring and firing workers to produce what is demanded each month, which is why this strategy has a high employee turnover rate. Another advantage of this strategy is the low inventory which can help the company to save money in the end. Many companies that train employees quickly employ the strategy to set a flexible schedule for employees. Restaurants such as McDonald, and Burger King make meals when ordered to meet the demand. Production is matched to meet the requested order. Car dealerships like Car-Mart may use this strategy because the employee turnover rate is high. When dealerships don’t sell cars that cost the company money and results in layoff.
Many challenges are correlated with this strategy. Companies have to hire trainable employees to meet the unforeseen demand since companies hire people based on the rate of increase or decrease in demand. They must train employees fast so it would not cause a disruption in the production process. According to Jacobs and Chase (2011), “The...