Integral Logistics Management — Operations Management and Supply Chain Management Within and Across Companies

Course 14 – Capacity Management

Intended learning outcomes: Present fundamentals of capacity management. Explain in detail load profile calculation and infinite loading. Disclose finite loading. Describe rough-cut capacity planning.


Unlike delivery lead time and delivery reliability rate, the efficient use of capacity is not directly observable by the customer. Nonetheless, it is an extremely important factor, since it enables the company to cut costs, ensure prompt delivery, and increase flexibility.

Work center capacity utilization, like levels of inventories in stock and work-in-process, increases the flexibility of logistics planning & control. Capacity resources have to be estimated for every planning term. Flexibility in medium- and short-term planning often requires long-term arrangements. In Figure 14.0.0.1, the tasks and processes covered in this chapter are shown against a darker background, referring back to the basic model introduced in Figure 5.1.4.2. Sections 1.2.4, 5.3.3, and 5.3.4 provide useful overviews for this chapter.

Fig. 14.0.0.1       The parts of the system discussed in this chapter (shown on darker background).

We will begin by reexamining the basic concepts presented in Chapter 4 and in Chapter 5 on the nature of capacity and on well-known types of capacity management. A detailed look at well-known techniques follows, broken down by objectives, basic characteristics, methods and procedures, range of application, and other factors.

Rough-cut capacity planning deserves special attention. It can be used for both long- and short-term planning. For short-term planning, it supports rapid order promising. The techni­ques differ according to whether they give greater weight to due dates or capacity limits.



Course sections and their intended learning outcomes

  • Course 14 – Capacity Management

    Intended learning outcomes: Present fundamentals of capacity management. Explain in detail load profile calculation and infinite loading. Disclose finite loading. Describe rough-cut capacity planning.

  • 14.1 Fundamentals of Capacity Management

    Intended learning outcomes: Produce an overview on capacity, work centers, capacity determination, and capacity management techniques.

  • 14.2 Infinite Loading

    Intended learning outcomes: Present load profile calculation and problems associated with algorithms for load profile calculation. Explain methods of balancing capacity and load. Describe order-wise infinite loading.

  • 14.3 Finite Loading

    Intended learning outcomes: Explain operations-oriented, order-oriented, and constraint-oriented finite loading.

  • 14.4 Rough-Cut Capacity Planning

    Intended learning outcomes: Describe rough-cut network plans and load profiles. Explain rough-cut infinite loading and rough-cut finite loading.

  • 14.5 Summary

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