Capacity planning activities capacity planning is the first step when an organization decides to produce more of a new or existing product. The link between process types and planning methods article pdf available in journal of operations management 2912. Pdf although the reliability of production plans is crucial for the. Stevenson 8th edition capacity planning capacity is the upper limit or ceiling on the load that an operating unit can handle. It encompasses many basis decisions with longterm consequences for the c authors. What could cause the utilization to be less than 100%. The time frame for shortterm planning is often only a few days but may go on as long as six months. Capacity planning comprises of the following types. Sep 18, 2017 this space is created so that ideas and information can be shared in a central place. Students learn by doing, and the ninth edition continues to offer. Capacity requirements planning ppcrp erp manufacturing.
Capacity planning and management learning outcomes after reading this chapter you should be able to. Assess the difficulties of matching capacity to demand. Capacity planning, capacity planning analysis, capacity. The hospital utilizes operations concepts such as strategic planning, process analysis, layout design, quality and safety monitoring and tracking, capacity planning, work design, and customer satisfaction and staff training to provide specialty care and emergency treatment for acute child patients process system improvement. Chap 5 capacity planning free download as powerpoint presentation. Capacity planning is a process through which the procurement of it resources, infrastructure and services are planned over a specific period of time. Thus, the importance of forecasting to capacity planning cannot be overstated. How to download the solutions manual of operations management. Strategic capacity planning for products and services. In the context of capacity planning, design capacity is the maximum amount of work that an organization is capable of completing in a given period. Operational planning refers to the translation of the strategic plan into activities, which might cover the whole range of operations involved in health care provision, including the allocation of budgets and resources, the organization of services and the provision of staff, facilities and policy brief capacity planning in health care 3. If we want to reduce the backlog, we have to increase the capacity or reduce the work center load.
The primary goal of capacity planning is to match supply to demand. Capacity planning unit introduction capacity planning is vital in operations management. Operations management thirteenth edition william j. Operations management text only 9th 07 old edition. Virtual university mcqs bank mcqs collection from online. Site location, facilities layout and various types, planning using craft work place design, working conditions noise illumination etc. Stevenson chapter 5 strategic capacity planning for products and services. Operations management, seventh edition, by william j. How to download the solutions manual of operations. Capacity is the rate of productive capability of a facility. Capacity planning capacity planning is a longterm strategic decision that establishes a firms overall level of resources.
Effective capacity planning is dependent upon factors like. Capacity planning is the process of determining the production capacity needed by an organization to meet changing demands for its products. If sufficient capacity is not available, then you must alter the plan or the capacity. The main weakness of the capacity strategy is a clear lack of long range capacity planning. Capacity planning stevenson chapter 5 capacity planning. Measurement of capacity planning the capacity of the manufacturing unit can be expressed in number of units of output per period.
The goal of shortterm capacity planning is to manage unexpected shifts in demand in an efficiently economic way. Strategic capacity planning process in construction business. The company relies heavily on flexibility and lacks capital base. Capacity planning is the process of predicting when future business demand will exceed the availability of it equipment, energy and space in the data center and then determining the most costeffective way to meet slas and delay saturation. The three types of capacity planning based on goal are lead capacity planning, lag strategy planning and match strategy planning. View 6 capacity planningch 5 stevenson from dsf 101 at georgia institute of technology. Lectures notes on production and operation management.
Capacity planning is the first step when an organization decides to produce more or new products. Motion study principles of motion economy, time studystandard time. Capacity is usually expressed as volume of output per time period. Defining the strategic capacity planning problem, identifying the most relevant characteristics and proposing a classification scheme is the first step towards the design of a general solving methodology and the development of specific solving procedures for each case. Based on todays changing landscape we propose the following refinement. Capacity planning can be challenging for organizations of any size. It extends over a time horizon long enough to obtain those resourcesusually a year or more for building new facilities or acquiring new businesses. Purpose of capacity plan provide the purpose of the capacity plan. Capacity planning impacts all areas of the organization it determines the conditions under which operations will have to function flexibility allows an organization to be agile it reduces the organizations dependence on forecast accuracy and reliability many organizations utilize capacity cushions to achieve flexibility. Describe the basic layout types, and the main advantages and disadvantages of each 7. Explain the strategic importance of process selection 2. The strategic planning undertaken by organization for a daily weekly or quarterly time frame is referred to as short term capacity planning.
Capacity is usually a major determinant of initial cost. Operations strategy capacity strategy authorstream. Solution manual operations management 11th edition stevenson. The ninth edition of operations management features the latest concepts and applications while not losing focus on the core concepts that has made this text a market leader. Capacity planning, in its various guises, is used to ensure that sufficient capacity is available to accomplish the planned production schedule generated by mps or mrp. Importance of capacity decisions impacts ability to meet future demands affects operating. Capacity planning is an important part of infrastructure and deployment planning a capacity plan supports the goal of optimum, and cost effective, provisioning of organizational resources and services by matching them to business demands. Capacity decisions often involve longterm commitment of resourcesand the fact that, once they are implemented, those decisions may be difficult or impossible to modify without incurring major costs.
Typically, the greater the capacity of a productive unit, the greater its cost. This space is created so that ideas and information can be shared in a central place. Chap 5 capacity planning operations management production. Delivery of services production of goods tangible output delivery of services an act service job categories government wholesaleretail financial services healthcare personal services business services education key differences customer contact uniformity of input labor content of jobs uniformity of output measurement of. This approachable text supports students in applying concepts and methods by providing solved problems, examples, questions, practice problems, and cases. Jul 07, 2014 capacity planning is a process through which the procurement of it resources, infrastructure and services are planned over a specific period of time. Describe the influence that process selection has on the organization 3. In the short term, capacity planning concerns issues related to scheduling, labor shifts, and balancing resource capacities.
Learn vocabulary, terms, and more with flashcards, games, and other study tools. It requires a delicate balance between realtime employee availability, available dollars in the budget, and the demand for work from customers, partners, or other stakeholders. Operations management, eighth edition, by william j. This makes the company vulnerable to bigger players in the industry. Operations management chapter 5strategic capacity planning. Measurement of capacity planning in production and. Capacity planning meaning, classification and its goals. Mgt6 operation managment solved mcqs chapert 2 a by stevenson 25 september 20 mgt6 operation managment solved mcqs chapert 1c by stevenson 24 september 20 mgt6 operation managment solved mcqs chapert 1 a by stevenson 21 september 20 mgt6 supply chain management solved multiple choice questions. Define and measure capacity and appreciate the factors that influence it. Evaluate and apply the different strategies for matching capacity with demand in the short. Systematic determination of resource requirements for the projected output, over a specific period. The operation has a design capacity of 10 loans per day and an effective capacity of 8 loansday.
Forecast demand smallerscale capacity increments allow the capacity plan to be adjusted to accommodate changes in demand actual demand capacity plan using 800unit plants capacity plan using 400unit plants 400 800 1,200 1,600 2,000 2,400 volume unitsweek time. Among the service topics are forecasting, product and service design, capacity supply chain management planning, management of quality and quality control. Clipping is a handy way to collect important slides you want to go back to later. During housing booms, fewer skilled workers are available which are lured by the bigger construction companies. Stevenson, operations management chapter 5 importance of capacity decisions measurement of. The ultimate goal of capacity planning is to meet the current and future level of the requirement at a minimal wastage. The strategic capacity planning undertaken by organization for 2 to 3 years of a time frame is referred to as medium term capacity planning. The aims of capacity planning are to identify and solve capacity problem in a timely manner to meet consumer needs, to maintain a balance between required capacity and available capacity, the goal of capacity planning is to minimize this discrepancy. Start studying operations management chapter 5strategic capacity planning. Capacity decisions need acute and careful attention by concerned persons as almost everything of the operations is related with capacity. Once capacity is evaluated and a need for new or expanded facilities is determined, facility location and process technology activities occur.
Capacity planning economies of scale production and. Page 192 stevenson, chapter 5, strategic capacity planning. Measurement of capacity planning in production and operations. Having a forecast of demand is essential for determining how much capacity will be needed to meet present and future demand. Now customize the name of a clipboard to store your clips.