Here we focus on supply options that define output rates and workforce levels. Two basic strategies are useful starting points in searching for the best plan.
The chase strategy involves hiring and laying off employees to match the demand forecast over the planning horizon. Varying the workforce’s regular-time capacity to equate supply to demand requires no inventory investment, overtime, or undertime. The drawbacks are the expense of continually adjusting workforce levels, the potential alienation of the workforce, and the loss of productivity and quality because of constant changes in the workforce.