Scribd
Upload
34 views

Steps in The Capacity Planning Process

Capacity planning is the process of determining the resources needed for a project. It involves forecasting demand, determining required capacity, calculating current capacity, measuring any gaps, and aligning capacity with demand by adding or optimizing resources. When developing capacity strategies, companies consider their goals, forecast the environment, address constraints through alternatives, and evaluate alternatives using tools like decision trees. The goal is to have the right resources available when needed for a project.

Uploaded by

abdo sadek
Copyright
© © All Rights Reserved
Available Formats
Download as PDF, TXT or read online on Scribd
34 views

Steps in The Capacity Planning Process

Capacity planning is the process of determining the resources needed for a project. It involves forecasting demand, determining required capacity, calculating current capacity, measuring any gaps, and aligning capacity with demand by adding or optimizing resources. When developing capacity strategies, companies consider their goals, forecast the environment, address constraints through alternatives, and evaluate alternatives using tools like decision trees. The goal is to have the right resources available when needed for a project.

Uploaded by

abdo sadek
Copyright
© © All Rights Reserved
Available Formats
Download as PDF, TXT or read online on Scribd
You are on page 1/ 5

capacity planning:

Capacity planning is the process of determining the potential needs of


your project. The goal of capacity planning is to have the right resources
available when you need them. Resources could mean individuals with
the right skills, time available to add another project, or the necessary
budget.

Steps in the capacity planning process:


1. Forecast your anticipated demand
If you know you have a new project coming up, make an educated
estimate on what work needs to be done for these projects. This will give
you an idea of the capacity that you’ll need to complete the project and
you can compare that to the current capacity you have on hand.

2. Determine required capacity


Based on your initial estimates, approximate the capacity you’ll need to
complete the work you forecasted in the previous step.

3. Calculate the resource capacity of your current team


If the average person can do approximately 30 hours a week and they
currently have projects they are working on, see how much capacity they
have in a week by subtracting their current workload in hours from the
average 30.

4. Measure the capacity gap


Based on the capacity needed for a project, measure how your current
resources compare to the anticipated demand.

5. Align capacity with demand


Look at the previous gap in capacity and optimize current and available
capacity so they are balanced. If your team is currently at capacity and
can’t take on additional work to complete the project, add more team
members in the short term to get the project done. If you have excess
capacity, consider adding another project to optimize your available
resources.

Capacity planning strategies


There are types of capacity planning that you can use in different
scenarios to optimize production capacity.
Developing capacity strategies
Supply of goods and services is highly dependent on the internal
constraints that involve limited manpower available and bottleneck
problems that hinder the production process, and the demand from the
customers. A good strategy can be developed with the help of the right
forecast of the cost that can be incurred while developing different
capacity levels.

• Developing capacity strategies consists of the following


steps:

1. Goal: The first step in developing capacity strategy is setting


a goal that one has to accomplish. The goal can be anything
from increasing the capacity to have a lower cost from large
volume to lowering the capacity when facing the competition.
This step allows you to decide on how the capacity has to
develop so that it can be achieved.

2. Forecasting: Once the goal has been set, one has to


evaluate the business environment consisting of the
marketplace and people who are close to the marketplace.
Forecasting the competition, pricing of the products and the
taste and preferences of the consumers etc. assists a lot in
developing capacity strategies.

3. Constraints: There are also some constraints that one has to


address while evaluating a strategy. One can increase the
overall capacity of production, but it can be done only by
installing a greater number of machines. To align with the
increased capacity of production, more staff can be added, but
that will also require a bigger office to accommodate the new
staff.

4. Alternatives: There are some alternatives always present


when facing constraints. These alternatives include having more
machines manufactured to increase the capacity or to give work
from home when facing office space issues. These alternatives
help in successfully dealing with the constraints.

Develop Capacity Alternatives


Once a company has identified its capacity requirements for the
future, the next step is to develop alternative ways to modify its
capacity. One alternative is to do nothing and reevaluate the
situation in the future. With this alternative, the company would
not be able to meet any demands that exceed current capacity
levels. Choosing this alternative and the time to reevaluate the
company's needs is a strategic decision. The other alternatives
require deciding whether to purchase one large facility now or
add capacity incrementally.

To enhance capacity management, the following


approaches to capacity alternatives could be
developed:
1. Designing flexibility into the system
2. Differentiating between new and mature products or
services
3. Taking a “big picture” approach to capacity changes
4. Preparing to deal with “chunks” of capacity
5. Attempting to smooth out capacity requirements.

Evaluate Capacity Alternatives


There are a number of tools that we can use to evaluate our
capacity alternatives. Recall that these tools are only decision-
support aids. Ultimately, managers have to use many different
inputs, as well as their judgment, in making the final decision.
One of the most popular of these tools is the decision tree.

You might also like