Capacity Mechanics

Objectives: Detailed required to produce effective load and priority plans; includes level of safety capacity. Capacity planning outputs to formulate: Capacity plans Tooling requirements Overload conditions Underload conditions Methods that balance capacity and load Rescheduling order Splitting orders Changing capacity workforce changes/subcontracting Modifying order quantities/priorities Close loop with master planning of resources and distribution planning Product quantities Timing Priorities Close loop within detailed scheduling and planning process Purchased Self-manufactured materials Part quantities Timing Priorities Close loop with execution and control of operationsverify that all these made correctly, on time: Manufactured parts Subassemblies Assemblies Priority/Capacity Hierarchy CRP cannot compensate for overloaded conditions caused by higher-level load/priority plans Accomplishing Production Schedules Capacity Priority Concerned with correct mix Valid due date maintenance of equipment, personnel, tooling, and other resources Receives and is dependent Validated by capacity on input from priority planning at each level planning functions CRP less common in repetitive and continuous line production CRP more common in job shop and batch production environments Resource planning typically loads departments/areas in terms of general amounts of work days, numbers of personnel, numbers of types of finished products. RCCP translates these conditions into capacity of key work centers (bottlenecks) Complications of Capacity Lot sizing

o Order timing variability because of aggregation o Order mix variability Bottlenecks Complexity o Uncertainty o Variability of demand CRP Inputs Routing Data Production Order Status Schedule of planned manufacturing order releases Workcenter data CRP Output Workcenter load report Revised schedule of planned manufacturing order releases Load Unit of Measures MPS Level o Product Category o Product Type CRP Level o Standard Hours o Standard Units Primary sources of load to be measure by CRP Open-order status info from Production Control Planned order releases produced by MRP Increasing Capacity Overtime/weekends Add personnel Extra shifts Add equipment/facilities Reassignment of personnel Reduce Load Decrease Lot Sizes Subcontracting Hold orders in production control Reduce MPS last resort Reducing Capacity Reassign personnel Eliminate shifts/reduce length of shifts Increasing Load Release orders early In-source normally purchased or subcontracted items Increase Lot sizes Increase MPS Redistributing Load Use alternate workcenter Use alternate routings

 Adjust operation start dates forward and backward in time Revise MPS or lot sizes Split orders Capacity Planning in Repetitive Production Fixed Routings Variable run times by product mix Insignificant queue and wait times Setup time only during line changeover Production rate constrained by slowest workstation Feedback at key points rather than at every operation *CRP is not often used in this environment* Measuring performance of Detailed Capacity Planning Process Eliminated past due load Balanced load according to capacity Shorter queues Reduced WIP Higher productivity Reduced idle time Reduced overtime Increased throughput Rated Capacity = Hours/shift x Days/Week x Shifts/Day x Number of Machines x Utilization x Efficiency Master Planning interaction Monitors info from key workcenters for overload and underload Distribution Requirements Planning Personnel Planning: o By wave or shift on daily basis per shipping plan Wave: store orders or routing stops being picked up at a time o Demonstrated capacity over time Detailed Scheduling and Planning Internal Interactions CRP closes loop with MRP in terms of availability of resources to support MRP priorities o More real time integration the better Identify orders for which capacity exists Capacity shortage for orders Execution and Control of Operations Interactions Identify orders for which capacity exists Identify orders for which there is capacity shortage Balance loads and capacity Advantages of CRP Confirms adequate cumulative capacity Considers lot sizes and routings Provides time-phases visibility of capacity and load imbalances Estimates lead time precisely Helps eliminate erratic lead times Disadvantages of CRP High amount of computation required Computational preciseness is approximation

 Applies mainly to non-repetitive production Extensive accurate input data required No precise level of detail (function of execution and control) Effect of MPS revision not clear Effects of not doing CRP Low Productivity Higher WIP Bottlenecks Late deliveries and shortages Long Lead Times High Labor costs