Aggregate Planning Process: Services vs. Manufacturing Strategies Video

An error occurred trying to load this video.

Try refreshing the page, or contact customer support.

Coming up next: Organizational Issues in Sales & Operations Planning

You're on a roll. Keep up the good work!

Take Quiz Watch Next Lesson
Your next lesson will play in 10 seconds
  • 0:00 What Is Aggregate Planning?
  • 1:14 Planning for Services
  • 2:20 Planning for Manufacturing
  • 3:15 Lesson Summary
Save Save Save

Want to watch this again later?

Log in or sign up to add this lesson to a Custom Course.

Log in or Sign up

Speed Speed

Recommended Lessons and Courses for You

Lesson Transcript
Instructor: Kevin Newton

Kevin has edited encyclopedias, taught middle and high school history, and has a master's degree in Islamic law.

Planning for the big picture can be tough for any business, but aggregate planning is essential for meeting demand at minimal costs. In this lesson, we'll further explore aggregate planning for both services and manufacturing.

What Is Aggregate Planning?

If you've ever owned or even worked for a company, you know that generally all aspects of business must be planned out in advance. Production levels must be determined in advance, inventory must be ordered with time for delivery, there must be a plan for reducing backlogs, and targeted sales must be forecasted. We plan out these and other aspects of business during a process called aggregate planning. Aggregate planning is the process of planning that includes developing, evaluating, and maintaining a broad and approximate schedule of the operations of an organization. This schedule usually spans three to eighteen months of business, and the aim is to prepare far enough in advance to fulfill forecasted demand at minimal cost.

There are two main strategies for aggregate planning. The first involves using complex mathematical formulas to predict demand and plan accordingly. The other is trial and error, which is much more informal and inexact. Without aggregate planning, things would be done in a slap-dash manner. The demand would like not be fulfilled, and the business would be at risk of failure. However, aggregate planning works differently for different types of businesses. Let's take a look at how aggregate planning works in manufacturing and for services.

To unlock this lesson you must be a Member.
Create your account

Register to view this lesson

Are you a student or a teacher?

Unlock Your Education

See for yourself why 30 million people use

Become a member and start learning now.
Become a Member  Back
What teachers are saying about
Try it risk-free for 30 days

Earning College Credit

Did you know… We have over 200 college courses that prepare you to earn credit by exam that is accepted by over 1,500 colleges and universities. You can test out of the first two years of college and save thousands off your degree. Anyone can earn credit-by-exam regardless of age or education level.

To learn more, visit our Earning Credit Page

Transferring credit to the school of your choice

Not sure what college you want to attend yet? has thousands of articles about every imaginable degree, area of study and career path that can help you find the school that's right for you.

Create an account to start this course today
Try it risk-free for 30 days!
Create an account