There are two different issues to consider in any type of manufacturing or production company. The first one is the actual throughput of the system or the facility, and the second is the potential capacity.
The throughput is the actual number of units which is produced in a given time period. The limiting factor on the throughput is the slowest part of the operation. The capacity is the potential for production based on the potential production of all equipment working together. The limiting factor of the capacity is often in the planning of the work, with efficient use of equipment and manpower often not a primary consideration for sales reps when scheduling orders.
To integrate capacity planning, or the maximum use of all systems and resources in a facility, understanding the entire processing or manufacturing system is critical. As this is impossible to do without a systemic analysis, software systems are essential to provide real-time information.
Current Capacity
The first step of any effective capacity planning program is to understand the current capacity and what is limiting production. This is relevant when there are additional requirements or the potential to grow the business. Ensuring the current system has the physical capacity to increase production or to meet production is be essential for any management team to understand.
Look at Limitations
Understanding the current limitations to both throughput and capacity provides the management team with a starting point for improvement. Unless the specific limiting factors are determined, investing in new equipment or adding employees is just a best guess type of scenario.
Future Focused
Businesses in periods of growth can also use capacity planning software to determine the system upgrades and additions offering the biggest impact on production and efficiency.
Having this data prevents costly mistakes in making investments in the wrong equipment or in bolstering systems that are already working to capacity.