Capacity Planning

Material requirements planning answers the question "what do we need?", but in its classical form, it assumes unlimited capacity . Capacity planning corrects this assumption: are there really machines and people to do the job?

Scope

  • Capacity supply is defined as the net capacity of each business center, derived from its calendar, shift, and utilization rates.
  • Capacity demand calculation: The load derived from planned and open work orders and route times.
  • Load profile: Comparison of supply and demand by source and period; visual representation of oversupply and gaps.
  • Bottleneck analysis: Identifying the source that restricts the entire flow. The main focus of planning is the bottleneck; high utilization rates in sources outside the bottleneck are not good, they create intermediate stock.
  • Capacity balancing methods: Shifting the work to another period, transferring it to an alternative work center, adding extra shifts, outsourcing, or rescheduling the order.
  • Finite capacity planning: Automatically generating a plan that does not exceed the capacity limit.
  • Scenario comparison: Comparing the alternatives of "if we add another shift," "if we activate this machine," and "if we outsource this product."
  • Long-term capacity plan: Investment decisions should be based on future load projections.


The practical result of the theory of constraints.

The output of a production system is determined by its slowest resource. This has three practical consequences:

1. An hour lost in a bottleneck is an hour lost for the entire system; it can never be recovered.
2. An improvement made in a non-bottleneck resource does not increase total output; it only creates intermediate inventory.
3. A bottleneck should never be left without material; there must be a planned buffer in front of it.

Therefore, the first task of capacity planning is not to try to balance all resources; it is to identify the bottleneck and protect against it .

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