POM page 335 Design and Effective capacity- Hongdonggeon.pptx

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Design and Effective capacity Definition : The theoretical maximum output of a system in a given period under ideal conditions Effective capacity Definition : The capacity a firm can expect to achieve, given its product mix, methods of scheduling, maintenance and stan- dards of quality. Design capacity Two useful definitions of capacity
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Design and Effective capacity Utilization Efficiency The rate of output actually achieved It cannot exceed effective capacity Actual output *Measured as percentages
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Design and Effective capacity Example S1 Determining capacity utilization and efficiency Sara james Bakery has a plant for processing Deluxe breakfast rolls and wants to better understand its capability. Determine the design capacity, untilzation, and efficiency for this plant when producing this Deluxe roll. APPROACH Last week the facility produced 148,000 rolls. The effective capacity is 175,000 rolls. The production line operates 7 days per week with three 8
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