The Northern Airplane Company builds commercial airplanes for various airline

companies around the world. The last stage in the production process is to produce the jet engines

and then to install them (a very fast operation) in the completed airplane frame. The company has

been working under some contracts to deliver a considerable number of airplanes in the near future,

and the production of the jet engines for these planes must now be scheduled for the next four

months.

To meet the contracted dates for delivery, the company must supply engines for installation

in the quantities indicated in the second column of Table case 1. Thus, the cumulative number of

engines produced by the end of months 1, 2, 3, and 4 must be at least 10, 25, 50, and 70,

respectively

The Northern Airplane Company builds commercial airplanes for various airline

companies around the world. The last stage in the production process is to produce the jet engines

and then to install them (a very fast operation) in the completed airplane frame. The company has

been working under some contracts to deliver a considerable number of airplanes in the near future,

and the production of the jet engines for these planes must now be scheduled for the next four

months.

To meet the contracted dates for delivery, the company must supply engines for installation

in the quantities indicated in the second column of Table case 1. Thus, the cumulative number of

engines produced by the end of months 1, 2, 3, and 4 must be at least 10, 25, 50, and 70,

respectively

CASE 1 - Production Scheduling of the Northern Airplane Company The Northern Airplane Company builds commercial airplanes for various airline companies around the world. The last stage in the production process is to produce the jet engines and then to install them (a very fast operation) in the completed airplane frame. The company has been working under some contracts to deliver a considerable number of airplanes in the near future, and the production of the jet engines for these planes must now be scheduled for the next four months. To meet the contracted dates for delivery, the company must supply engines for installation in the quantities indicated in the second column of Table case 1. Thus, the cumulative mumber of engines produced by the end of months 1, 2, 3, and 4 must be at least 10, 25, 50, and 70, respectively. Table case 1 - Production Scheduling Date for the Northern Airplane Company Problem Unit Cost of Production Month Scheduled Maximum Production (Smillion) Unit Cost Installations Regular Overtime Regular Overtime of Storage Time Time (Sthousand) 10 20 10 1.08 1.10 15 15 30 15 1.11 1.12 15 25 25 10 1.10 1.11 15 20 5 10 1.13 1.15 The facilities that will be available for producing the engines vary according to other production, maintenance, and renovation work scheduled during this period. The resulting monthly differences in the maximum number of engines that can be produced during regular time hours (no overtime) are shown in the third column of Table case 1, and the additional numbers that can be produced during overtime hours are shown in the fourth column. The cost of producing each one on either regular time or overtime is given in the fifth and sixth columns. Because of the variations in production costs, it may well be worthwhile to produce some of the engines a month or more before they are scheduled for installation, and this possibility is being considered. The drawback is that such engines must be stored until the scheduled installation (the airplane frames will not be ready early) at a storage cost of $15,000 per month (including interest on expended capital) for each engine, as shown in the rightmost column of Table case 1. Apply Excel Solver and QM for Windows to help the Northern Airlines Company's production manager develop a schedule for the number of engines to be produced in each of the four months so that the total of the production and storage costs will be minimized