Capacity planning is a process that balances the available resources to meet customer demand or the project capacity requirements.
Capacity, in project management and manufacturing terms, is the most work that can be done over a certain timeframe.
In project management, the capacity planning process is very important because it’s related to critical project management knowledge areas such as:
- Resource management
- Time management
- Team management
- Work Management
The benefits of effective capacity planning are enormous, and include:
- Cost reduction
- Assisting supply chain management
- Reducing production lead time
- Preventing stock-outs
- Helps eliminate excesses
Organizations have been known to invest significant capital into capacity planning strategies. This may include the purchase of new equipment and the leasing of new facilities. But these costs of capacity planning are normally offset by the significant advantages of capacity planning.
For example, effective capacity planning can help monitor costs. Being able to see projected capacity needs allows the company to budget for upcoming changes, and apply financial resources where needed. Capacity planning is also used to help develop delivery schedules for supplies and shipping schedules for completed products.
Organizations can also use capacity planning to maintain proper production levels during expected business cycles. For example, if your company traditionally sees an increase in orders during the summer in anticipation of the Christmas season, then you can use historical data to plan production capacity and have ample staff on hand to handle the rise in demand.
Your capacity planning also identifies when the cycle starts to head downwards so that you can lay off seasonal workers and avoid the added personnel expense.
Want to know more about Capacity Planning? Tonex offers Capacity Planning Training, a 4-day course that covers tactics for doing performance analysis, system sizing, performance measurements, trend analysis in today’s challenging business and IT environment.
Tonex also offers several other courses in Cloud Computing Training.
For more information, questions, comments, contact us.