Willow Trees Inc. makes seven different products, four of which are within their first year of existence. The demands for all products, especially the newest ones, are not well known. The newest products are intended to complement their existing products and take different materials, different processes, and an entirely different set of labor skills for production. Which of these statements regarding their likely sales and operations planning activities is BEST?
A)The planning values for the oldest items in the product line should be used for the new items in the product line.
B)Willow Trees Inc. should avoid using sales and operations planning until their product line matures.
C)Willow Trees Inc. should use top-down planning.
D)Willow Trees Inc. should use bottom-up planning.

Question

Quizplus · Accepted Answer

Willow Trees Inc. should use bottom-up planning as the demands for the new products are not well known. Bottom-up planning involves starting with a detailed analysis of the demand at the individual product level and building up to an overall sales and operations plan. This approach would allow Willow Trees Inc. to better understand the demand for each individual product and plan their production accordingly, rather than relying on planning values for their older products or using top-down planning, which starts with an overall sales and operations plan and breaks it down into individual product plans.