Why You Should Make Capacity Planning Your Goal

Many managers have been taught to think of capacity planning as a process. It’s rare to build a facility from nothing; most managers start with a structure that is already in operation, then improve its operations and efficiency. Have you ever stopped to think about how you would design your facility if you didn’t have equipment and personnel already in place?

In creating a manufacturing floor “from scratch,” you and your management team would be forced to consider the most efficient way to arrange everything from workforce to the factory floor layout. The principles of capacity planning would immediately come into focus as you weighed the costs vs. the benefits of your mechanical and labor scheduling. Do you hire additional personnel, or ask current workers to put in overtime? Do you keep multiple lines running the same product, or set up production for multiple products? Rather than reacting to issues as they came up in your facility, this level of planning would allow you to address problems before they materialized. You would have the ability to meet customer demand before that demand even existed.

While a complete redesign of your facility is probably unrealistic, the same principles of capacity planning that are used to create a new facility can be applied to an existing facility. This method of planning requires you to consider your product demand, then streamline your factory operations to meet just this demand, creating product with greater efficiency and minimal waste.

When capacity planning is a goal of your facility, your thinking changes from “How CAN we address the customer demand?” to “How SHOULD we address the customer’s demand?” Instead of reacting to orders as they come in, your facility will have a procedure in place to produce orders in the most efficient way possible.

In many cases, this means streamlining operations on the factory floor. In fact, many aspects of capacity planning deal with the relationship between your production equipment and your operators. With proper planning, each item that needs to be produced is assigned a time on a production line, and each production line is staffed with the optimal number of personnel that are needed to operate the production equipment.

In an ideal environment, your management team is constantly working towards achieving the perfect balance of personnel, equipment, and production orders. This perfect plan is a dynamic one; it is constantly changing as the needs of the customer, the availability of personnel, and the production capacity of the equipment changes. Upgrades to equipment, alterations in the personnel schedule, and fluctuations in customer orders can force a management team to review their entire planning strategy and come up with new solutions to increase efficiency and reduce costs.

Of course, every manager knows that achieving this exact balance of material, product, equipment, and personnel is next to impossible to do without an excellent software program to track and model every variable. Planning software assists with addressing the variables of day-to-day operations as well as offering forecasting and simulation tools for future needs.