Capacity planning is critically important in operations and supply chain management. Here are some capacity management principles I have learned over the years working in various Operations Management roles. Can you think of a way that one or more of these principles could be applied in your work environment to improve throughput? a. Constantly hone the demand forecast and take action to meet demand spikes before they happen; b. Monitor utilization and take action if it is trending upward and there is no reason believe this trend will not continue; c. Use FIFO (First-In-First-Out) wherever possible; d. Order materials on as close to a real-time basis as possible, being cautious about quantity discounts; e. Try not to change factors around in the organization constantly, as this becomes confusing and learning how factors relate to outcomes becomes difficult; f. Move toward one-piece flow, though one-piece flow may not make sense in all cases; move away from large batches; g. Look for bottlenecks and take action to eliminate them; h. Look for ways of streamlining the operation before investing in capital; i. Invest in capital if necessary but sell capital only when the operation is actually closed unless an entire product line or other large-scale change has occurred;
Did you encounter another principle of capacity planning and management that you find particularly intriguing or applicable to your work environment?