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. ï¿½What’s hot one day will soon be yesterday’s worn-out trend. Things that go well oneï¿½week 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. ï¿½If you are not planning these things wisely, your business's performance may suffer.
Thanks to a process known asï¿½capacity planning, business owners can handle these types of issues in a structured way, one based on research, experience and knowledge from industry experts. Indeed, manyï¿½online MBA programsï¿½spend at least some time explaining the fundamentals ofï¿½capacity 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 termï¿½capacity planningï¿½covers things like efficient scheduling, hiring and cross-training, all of which serve to increase production. ï¿½Capacity managers consider issues likeï¿½the 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. ï¿½Where will new plants be located? ï¿½Are the existing facilities near enough to transportation? ï¿½How much preventive maintenance is required for optimal performance of equipment and technology? ï¿½Can 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. ï¿½Anï¿½online MBA programï¿½can prepare graduates to make important decisions related to capacity planningï¿½and other operational issues. ï¿½Most firms will incorporate one of theï¿½four proceduresï¿½geared towards planning capacity (CPOF, CRP, resource profiles, or capacity bills).
Anï¿½online MBA programï¿½that 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.
Have a question or concern about this article? Please contact us.