Capacity is the maximum amount possible, of… something. That something may be seats in a theater, grain in a silo, passengers in an airliner, gallons from a fountain.
Or, to the focus of this section, capacity may express the amount of widgets produced, service calls made, brick laid, pallets moved or stored, orders shipped, applications processed, lines of code written; all within a time frame. The term “Capacity” is sometimes used to refer to what is possible from a building, or process, or equipment, or workforce when the technically correct answer is that all of the components make a contribution.
Capacity is the sum of what your organization can create, given its resources, to meet sales, demand, and product mix changes.
Often it can’t react as quickly as you’d like, either up or down. You may have noticed that.
The ability to produce a capacity is, sooner or later, limited by some constraint, Utilization is the relationship of how much capacity is used compared to how much is available.
Typically “constraints” brings into mind the production floor; low attainment, equipment downtime, unbalanced workloads, understaffed positions, equipment bottlenecks, maintenance, hiring difficulty.
Let’s not forget these, but consider also the business context of capacity as 1) policy from the boardroom involving number and location of facilities and manufacturing space, new technology investment, equipment budget for installed capacity, headcount employed.
2) decisions made in manufacturing management. Such as vendor sourcing that results in supply chain disruption, line changeovers scheduled for real or perceived customer service, preventive maintenance, spare parts from the stockroom or by Fed Ex (if the vendor has any available), accuracy of documentation.
3) Sometimes capacity planning didn’t forecast how popular your new products will be; rejoice in that shortfall while it’s all hands on deck to keep up.
JPR has resolved many capacity issues, to identify and improve,and will be pleased to assist your operations. Rather than just post, email at jack@jacksonproductivity,com and we’ll talk.