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Capacity Planning Approaches There are four principle methods to approach capacity planning Each method is based on reacting to or planning for market fluctuations and changing levels of demand These capacity planning strategies are match, lag, lead, and adjustment MatchAggregate capacity is the total amount of capacity required or available to carry out a function It also tells about the 3 best strategies for aggregate planningThey are level strategy, Chase strategy and hybrid strategyFlexing capacity to meet demand A second strategic approach to matching demand and capacity focuses on adjusting or flexing capacity The fundamental idea here is to adjust, stretch and align capacity to match customer demand During periods of peak demand the organization seeks to stretch or expand its capacity as much as possible

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Level capacity strategy characteristics

Level capacity strategy characteristics-Participatory capacity building A practical toolbox for internal or external facilitators of capacity building in NGOs The tools can be used to assess an organisation's capacity and to plan for strategic and innovative directions for organisational improvement The toolbox is tailored to developing countries, especially in AfricaMarket level strategy This strategy level focuses on how you're going to grow Will it be through market penetration, market development, product or service development, or diversification?

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Capacity are interdependent, and growth in one area is dependent on growth in another16 Consequently, while a particular capacitybuilding initiative might focus on one type of capacity, all four types of capacity must be "aligned and addressed" if the organization is to meet its goals for change17 Levels of capacityCapacity planning is a strategic process whereby a company determines what level of capacity it will need to satisfy the level of demand forThe characteristics of these two vastly different strategies are outlined in the Exhibit, "Comparison of chasedemand and levelcapacity strategies for the XYZ brokerage firm"

In this lesson, we'll discuss the characteristics of markets in decline and some strategies companies in a declining industry can remain competitive Updated CreateLevels of Decision making Strategic decisionmaking determines the objectives, resources and policies of the organisation A major problem at this level of decision making is predicting the future of the organisation and its environment and matching thecharacteristics of theCapacity is usually planned on the basis of labour or machine hours available within the plant Thus, capacity planning is planning for quantity or scale of output Capacity Planning – Meaning, Improtance, Determinants, Procedure There are four major considerations in capacity planning Level of demand Cost of production Availability of funds

11 The Framework of Capacity Development Activities 12 Procedure of Capacity Assessment Exercise 1 Confirmation of the Mandate Exercise 2 Stakeholder Analysis Exercise 3 Definition of the most Important Capacities Exercise 4 Evaluation of the Current Capacity Level Exercise 5 Capacity Assessment of the Current Individual Capacity andFigure Level Capacity Plan Figure shows the level capacity plan of a company manufacturing a product on produce to stock and sell basis In the first quarter aggregate demand is less than production and inventory builds up till the end of the First Quarters in the second third and fourth quarters are inventory levels Decline because production is less than the aggregate demandCapacity Planning and Management are explained in this videoThe text was created by an experienced Lean Thinker that gives his point of view on the Capacit

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What many project leaders overlook about capacity is that it goes beyond a project and must be looked at from a strategic level in order to get it right and make it last!The objective of capacity management (ie, planning and control of capacity) is to match the level of operations to the level of demand Capacity planning in Production and Operation Management Capacity planning is to be carried out keeping in mind future growth and expansion plans, market trends, sales forecasting, etcZS Hua, P Banerjee, in Agile Manufacturing The 21st Century Competitive Strategy, 01 2 INTEGRATING CAPACITY PLANNING AND LINE DESIGN WITH PRODUCTION PLANNING Capacity planning is usually motivated by reducing operation costs, meeting market demand fluctuation and/or pursuing better customer service The major decisions in current capacity planning

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Each one of us has some capacity for leadership though some of us are born with traits that make it easier to become leaders, but all of us can develop leadership skills If you have the desire and the will power, you can become an effective leader( 6 ) David Thomas believes leaders are 90% made, may be even more( 7 ) It is common knowledge that good leadership isThat sets the overall scope for capacity development The organizational level refers to the internal structure, policies and procedures that determine an organization's effectiveness It is here that the benefits of the enabling environment are put into action and aThe level capacity strategy, the focus is on the process where product output remains at a somewhat fixed level and increases/decreases in demand are satisfied through strategic decisions of utilizing inventory (maintain buffer stock), outsourcing and backorders

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Nature and characteristics of strategic decisions Strategic decisions are decisions about an organization's strategy There is no doubt that strategic decisions have a major impact on any organization However, when it comes to really strategic decision making, things tend to get a bit blurry Not all futureoriented decisions are strategicEffective capacity is the optimum production level under predefined job and workschedules, normal machine breakdown, maintenance, etc Medium Term Capacity The strategic capacity planning undertaken by organization for 2 to 3 years of a time frame is referred to as medium term capacity planning Short Term Capacity The strategic planning3 Five central characteristics of the concept of capacity the big systems level on the assumption a comprehensive approach to improving capacity is Strategies for capacity development 1 Section below addresses the associated idea of 'capacity development'

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Community capacity is defined as the interaction of human capital, organizational resources, and social capital existing within a given community that can be leveraged to solve collective problems too improve or maintain the well being of a given community It may operate through informal social processes and/or organized effort (Chaskin, 01) 1Chase Capacity Management Opposite to the level capacity management is the chase capacity, " organisations could decide to match capacity and demand by altering the availability of resources This might be achieved by employing more people when it is busy and adopting strategies such as overtime and additional shiftsLead Strategy An upfront investment in more capacity that you need This can be done when capacity is inexpensive or difficult to obtain For example, a new vineyard anticipates using less than 10 acres of land in its first 5 years but purchases 100 acres of land as a long term investment in the business

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Capacity Planning It's pprove/cancel projectsCapacity Planning is vital in operations management Capacity is the rate of productive capability of a facility Capacity decisions need acute and careful attention by concerned persons as almost everything of the operations is related with capacity It is important as it determines the optimal level of production andCharacteristics Needed to Excel at Capacity Planning and Resource Management At the most basic or adhoc level of maturity, has been providing strategic marketing services for years including market research, product marketing, positioning,

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In our next post we will be going into detail7 Characteristics of CapacityCentered Organizations They assess whether the capacity is there at a role level, and if not, they schedule the work when it is, or make tradeoffs accordingly They have a strategic, capacitycentered Project Management OfficeLevel Strategy The goal of an aggregate planning strategy is to keep the production rate and the workforce level This requires strong forecasting of demand to know if production levels must be increased or decreased as customer demands grow and shrink

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Key Characteristics Of Corporate Level Strategy 1) Long Term Corporate level strategies are aimed at the longterm rather than the shortterm You may formulate them quickly, but their implementation and completion will take much longer 2) Uncertain Corporate levels strategies are, by nature, uncertainAggregate Planning Characteristics The reactive aggregate planning strategy creates changes in the capacity to match with the changing demand Level Approach This is considered the best approach to manage project outputs and workforce activities in aLevel capacity strategy When an organization adopts the level capacity strategy then it manufactures at a constant output rate It does not consider any fluctuation or change in the level of demand This may lead to stockpiling or holding of inventory in high quantity, when there is a decrease in the demand level

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The level strategy is considered a traditional aggregate planning method that maintains a steady production rate as well as the level of the workforce by continuing consistent human resources and production in the organization It is best suited where the inventory carrying costs are not high and are adopted by mainly manufacturing companies For any hotel, airline, restaurant or otherStrategy can be considered to exist at three levels in an organization (see Table 21) Corporate level strategy Corporate level strategy is the highest level of strategy It sets the longterm direction and scope for the whole organization If the organization comprises more than one business unit, corporate levelWith the level strategy, production remains at a constant level in spite of demand variations The use of a level strategy means that a company will produce at a constant rate regardless of the demand level In companies that produce to stock, this means that finished goods inventory levels will grow during low demand periods and decrease

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Key Features for Strategic Capacity Planning Tools Flexible scheduling Most companies will not get capacity planning correct from the get go, so making sure that scheduling and other important tasks can be handled flexibly and without needing to erase all the hard work to establish the system is important for good capacity planning softwareHere's a quick look at three key resource management approaches you can use for strategic capacity planning To keep things interesting, we'll personify each strategy as a character from the Harry Potter universe 1 Lead strategy Some of Harry's traits that we notice throughout the books and movies areThe characteristics of these two vastly different strategies are outlined in the Exhibit, Comparison of chasedemand and levelcapacity strategies for the XYZ brokerage firmCombination Strategy All the strategies discussed above can be applied simultaneously, sequentially, or in a combination 2 Business Level Strategies Businesslevel strategies are

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This revision video provides an overview of the concept of capacity, capacity utilisation and some of the issues facing businesses operating at low or high uThese components of strategic leadership make up the key traits of strategic leaders and how they contribute to their success These are 10 characteristics of a good leader and by following the example of these strategic leadership style qualities you can improve your efficiency as a leaderCapacity Management Strategies If IT was like a restaurantthen capacity management should be like the restaurant manager (aka Maître D') Unfortunately, too many organizations are using capacity management as the cleanup department When something goes wrong, capacity management fixes it 3 Types of Capacity Management Capacity management

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Emphasised individual capacity to the exclusion of organisational and institutional capacity There is a growing awareness that human resource development alone is not the answer to capacity constraints in most institutions These levels are depicted in Table 1 Civil Society Capacity Development Results Framework by LevelCapacity planning isn't just about the number of people you have, but should be based on the skills of those resources, the budget allocated to projects, and what business initiatives are being driven fromCapacity planning is more high level and helps you determine what and how many resources you need to meet demand Resource planning is more about analyzing resource utilization you use it to takes the number of resources available (as determined by your capacity planning) and allocate them to individual projects

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