From the Shadows
Interfaces, Volume 13, Number 2, April 1983
From the Shadows by David S. Hirshfeld, published in the journal Interfaces in 1983, discusses the practical application of linear programming (LP) in corporate strategic planning and how it can be used to optimize resource allocation and improve decision-making processes within organizations.
Virtually all linear programming applications facilitate and support orderly planning of the future activities of a complex system. In the private sector, the system is usually a large business organization, a sector of one, or a collection of facilities for such functions as production, manufacturing, distribution, and storage. One can usually identify four conceptual levels of planning in a large coporation, differing in the organizational level of responsibility, the scope of planning issues addressed, the degree of detail, and the planning horizon:
- Scheduling and dispatching (what specific operations or sequences of operations should be performed to meet specified output requirements in the next operational period: hour, day, week?),
- Operations planning (1-12 months),
- Tactical planning, (1-5 years), and
- Strategic planning (5 years and beyond).
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