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Capacity planning is a vital part of many businesses

They say that the only predictable thing about life is its unpredictability. That's also true in business. If there is one thing all business owners would agree upon, it’s that the market (no matter what type of business you’re in) is unpredictable. What’s hot one day will soon be yesterday’s worn-out trend. Things that go well oneweek can be a complete disappointment the next.

What can separate successful companies apart from those that fail is how they deal with the ebb and flow of business. Staying on top of inventory, planning your hiring in a timely manner, ensuring that the right technology and the proper equipment is in place … those are all part of what is known as capacity. If you are not planning these things wisely, your business's performance may suffer.

Thanks to a process known ascapacity planning, business owners can handle these types of issues in a structured way, one based on research, experience and knowledge from industry experts. Indeed, manyonline MBA programsspend at least some time explaining the fundamentals ofcapacity planning.

Long-term vs. short-term capacity planning

Effective capacity planning depends on several factors, such as production technology, staffing, operational structure, and legal regulations. In general, capacity planning can be broken down into two types: short- and long-term.

Short termcapacity planningcovers things like efficient scheduling, hiring and cross-training, all of which serve to increase production. Capacity managers consider issues likethe importance of cross-training and how much overtime to approve so that they can meet customer demand while still maximizing profits.

Long-term issues involve anything having to do with a company’s production facilities. Where will new plants be located? Are the existing facilities near enough to transportation? How much preventive maintenance is required for optimal performance of equipment and technology? Can the plant be reorganized for greater efficiency?

How on online MBA can help with capacity techniques

Techniques for dealing with increased or decreased need for capacity are complex and varied. Anonline MBA programcan prepare graduates to make important decisions related to capacity planningand other operational issues. Most firms will incorporate one of thefour proceduresgeared towards planning capacity (CPOF, CRP, resource profiles, or capacity bills).

Anonline MBA programthat covers operations management and capacity planning helps prepare its graduates for a career in this vital area.

Learn more about Texas A&M-Corpus Christi’s online MBA program.

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