Question

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1)Identify and briefly explain at least 3 major factors that determine effective capacity of a system.

2)Identify and briefly describe the steps in capacity planning process

Answer 1

1)

Factors that determine effective capacity of a system:

Human Factors – The efforts that are required in certain jobs and the skills and experience required to perform them efficiently are all linked to the potential and actual output of the system. Intrinsic factors like employee morale and motivation play a huge role in absenteeism rate and labour turnover, which ultimately affects the output rate as well.

Process Factors – For obvious reasons, Quantity is an important determinant in output capacity, but so is the Quality. If the quality does not meet the desired standards, then there is a need to review, rework and examine the activities which in turn reduces the output rate. Process improvements that promote productivity and quality results in increased output.

Operational Factors – Inconsistency in equipment capabilities and performance can prove to be an obstacle in effective scheduling. Furthermore, other operational aspects late deliveries, inventory stocking decisions, purchase requirements, quality inspection, etc, all play an important part in the effective capacity of the system.

2)

Steps in Capacity planning

Determining the requirements at the Service level

In this step, an organization divides it work into categories. The workloads are established, the units of work are determined, and the service levels are set. Businesses organize these workloads depending on the manpower available, the type of work, or the processes that are involved within the work. In the next part of this process, the parameters are laid out that defines the satisfactory level for each department.

Assessing the current capacity

Organizations conduct an in-depth assessment of their current production to analyse its current capacity. They assess each work department and the system in its entirety. This enables the organization to understand which department consumes the maximum resources and which department has the most efficient response time.

Planning for the future

After assessing the current capacity, the third step involves planning for the future. The forecasted requirements serve as a guide to avoid taxing the system. To accomplish this task, it is imperative to understand the quantity of incoming work that the system is expected to face in the coming months. The optimal system is then configured using this assessment which ultimately promotes satisfactory service levels over the concerned duration.