Business Core · Manufacturing Operations · Module
Capacity planning
Matching what can be produced to what will be needed, over a horizon long enough that capacity can still be changed.
The idea
How it works
Capacity is set by the constraint, not by the average. Adding capability anywhere other than the bottleneck changes cost without changing output, which is why so much investment produces no measurable improvement.
The horizon matters as much as the number. Capacity that takes nine months to add must be planned nine months ahead, and demand signals that arrive later than that cannot be responded to whatever anyone decides.
Working with it
In practice
- 01
Find the constraint before investing
Output is set by one step. Improving any other step moves the queue, not the total.
- 02
Plan on the lead time of capacity
How long it takes to add is what sets the planning horizon.
- 03
Decide whether to lead or lag demand
Leading costs idle capacity; lagging costs missed sales. Choose rather than drift.
- 04
Distinguish theoretical from practical capacity
After maintenance, changeover and variability, practical capacity is the number that plans should use.
One level in
The components of capacity planning
A component is something that exists afterwards which did not exist before — a deliverable or a mechanism, not an intention.
Investment away from the constraint changes cost without changing output. Find the constraint first.
The other modules in manufacturing operations
Production flow
How work moves through production — batch sizes, queues and handovers — and where it spends time without being worked on.
LearnQuality management
Ensuring output meets specification, and finding out why when it does not. Detection is the fallback; prevention is the work.
LearnMaintenance
Keeping equipment capable of producing. Planned maintenance is inconvenient; unplanned maintenance is expensive and arrives at the worst moment.
Learn