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Manychip case

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In your role as Manychip's production planning staff member, one of your tasks is to help the supply chain team focus on capacity planning. The company has determined they will use one or more of the following options to optimize capacity planning:

The use of dedicated and flexible facilities: Manychip has several permanent storage facilities and has used temporary storage in the past.

Flexible workforce: Manychip's workforce generally works 8-5 Monday through Friday, though some Asian locations have different days of working. Management is considering adjusting existing workforce time structures to meet planned demand.

Subcontracting: With the planned demand increasing, perhaps temporarily, subcontracting the additional resources might be an option.

Product design flexibility: Manychip is considering modifying its factory production lines to be better able to handle future demand.
Using course materials and other research:

1. Identify one or capacity planning methods that you will recommend for Manychip and explain the method and how it is used in various industries. Are there other options?
2. Identify the advantages and disadvantages of your proposal.

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Solution Preview

I will address this question by first addressing the concept of capacity planning and then reviewing a few capacity planning methods while also addressing the steps I feel are necessary to effectively create a capacity plan that meets service levels.

Capacity planning is a strategic process used to match data center resources with business demand to provide acceptable service levels at a minimum cost. It's a critical process that integrates tightly with performance management, service level management, and configuration
management. Capacity planning is used to plan hardware and software purchases, plan upgrades, and consolidate servers. It helps you make the most efficient use of resources, identify
underutilized resources for redeployment, and predict resource requirements so you can meet service levels without over- or under-provisioning.

Capacity Planning Methods:
Capacity trending is one approach to capacity planning. It looks at historical patterns, applies a linear trend line, then predicts capacity requirements based on this linear growth path. The advantage of this method is its simplicity. The disadvantages are that it often leads to inaccurate
predictions-since most businesses experience non-linear performance swings due to changes in demand-and it does not take into account how applications and workloads consume resources.

Capacity modeling is a more sophisticated ...

Solution Summary

Identify one or capacity planning methods that you will recommend for Manychip and explain the method and how it is used in various industries. Are there other options?

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