Capacity Planning
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Capacity Planning
Theory and Application
Hoda ElMaraghy1 and Ahmed M. Deif2 1 Intelligent Manufacturing Systems Center, University of Windsor, Windsor, ON, Canada 2 Orfalea College of Business, California Polytechnic State University (CAL POLY), San Luis Obispo, CA, USA
History Capacity planning is motivated by manufacturers’ desire to meet customers’ demand. Uncertainty of the customer’s demand increases the complexity of capacity planning. Capacity planning is often confused with scheduling since both deal with managing production to meet demand. However, a major distinction between both activities is that capacity planning is focused on meeting the anticipated demand on the strategic and tactical level, while scheduling focuses on how to meet demand on the shop floor operational level. This distinction brings about different scope, strategies, models, and tools used in meeting the capacity and resource scheduling demands. A classic example of how a scheduling is addressed as a capacity problem is the typical formulation to solve an allocation problem of a set of unrelated machines which process a group of products by trying to determine the optimal values of the allocation variables which assign portion of each of the machine’s time to each of the considered products to improve a specific performance metric (a typical example can be found in Leachman and Carmon 1992). Capacity planning was classically addressed as a problem of capacity expansion. However, modern planning is concerned with both the reduction and expansion of capacity given the turbulence in markets today. Another major difference between classical and modern capacity planning is their
Synonyms Productive volume planning
Definition Capacity is defined, in the context of manufacturing, as the maximum rate of production and the ability to yield production. Capacity planning is concerned with defining all resources and factors that affect the ability of a manufacturer to produce including equipment, labor, space, and time (i.e., number of shifts). The outcome of capacity planning is an investment strategy and resource utilization plan defined based on optimal policies that try to fulfill demand and its variation while considering various system’s operational objectives and constraints.
# CIRP 2016 The International Academy for Production Engineering et al. (eds.), CIRP Encyclopedia of Production Engineering, DOI 10.1007/978-3-642-35950-7_6388-3
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enabling technologies. The techniques used for planning capacity expansion are classical techniques such as adding work shifts, manpower, new production facilities, and subcontracting, whereas for modern capacity planning technologies such as modular design, reconfiguration, open control architectures, and changeability strategies are used, in addition to classical approaches, to implement more scalable, flexible, and successful capacity planning policies.
Capacity Planning Market Demand How much? Capacity
Which type? When?
Time
Capacity Planning, Fig. 1 Capacity planning problem’s questions
Theory Abo
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