Activities involved in Capacity planning

Capacity Planning

• Capacity planning involves activities such as:

1. Assessing existing capacity
2. Forecasting future capacity needs
3. Identifying alternative ways to modify capacity
4. Evaluating financial, economical and technological capacity alternatives

Selecting a capacity alternative most suited to achieve the strategic mission of the firm. Capacity planning involves capacity decisions that must merge consumer demands with human, material and financial resources of the organization

4 Types  of Capacity  Planning are:

•           Long term Capacity Planning

•           Short-term Capacity Planing

•           Finite Capacity Planning

•           Infinite Capacity Planning.

• Two catagories of factors affecting capacity planning are:

•           Controllable Factors

•           Less Controllable Factors.

• Capacity Requirement Planning (CRP): A technique to determine the labour and equipment capacities needed to meet the objectives.