Module 3 - Home

Capacity & Forecasting

Modular Learning Outcomes

Upon successful completion of this module, the student will be able to satisfy the following outcomes:

  • Case
    • Analyze manufacturing capacity using capacity management and planning concepts.
    • Develop a capacity plan for a manufacturing company.
  • SLP
    • Design and develop a capacity plan for a non-mfg. company.

Overview of Module 3

Scenario

COMPANY EMAIL

FROM: George Washburn

SUBJECT: Follow-up and the next potential project - capacity

I am now reviewing your inventory plan. My initial thoughts on it are that you have some good information. I will get back to you on it shortly. There is another matter that has come onto my radar. I have some concerns about capacity, particularly in the Plasti-Brack product line. Be on the lookout for another email with more details.

Let me know if you have any questions

~GW

Learning Wizard

WHY LEARN ABOUT CAPACITY? Recall from the course overview that just recently, Gulfstream, a business jet manufacturer, is planning to increase its production capacity as its business volume begins to come back[4]. At the same time, CEOs of trucking and rail companies are forecasting a short supply of capacity in freight transport industry[5]. Production Capacity is the ability to produce a specific amount of output over a specific amount of time. But there is also another definition and that is the capability to hold or contain a certain amount of things, such as inventory.

The module will show you how to understand capacity and tell you some of the issues with this operations function and how to plan for it including forecasting.

What are other companies doing about Capacity?

  1. Gulfstream to invest $500m in R&D, production capacity
    Croft, J. (2010). Gulfstream to invest $500m in R&D, production capacity, Flight International. London: Nov 23-Nov 29, 2010. Vol. 178, Iss. 5267; p. 24,
  2. Freight Capacity Will Tighten, Carrier Executives Predict
    Watson, R. (2010). Freight Capacity Will Tighten, Carrier Executives Predict, Transport Topics. Alexandria: Nov 22, 2010. pp. 3,4,
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