BusM 361 Capacity Management Fall 11

BusM 361 Capacity Management Fall 11 - BusM 361: Strategic...

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BusM 361: Strategic Capacity Management “And see that all these things are done in wisdom and order; for it is not requisite that a man should run faster than he has strength. And again, it is expedient that he should be diligent, that thereby he might win the prize; therefore, all things must be done in order. ” Mosiah 4:27
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Strategic Capacity Management
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Capacity Utilization Where, Capacity used = rate of output actually achieved Best operating level = capacity for which the process was designed level operating Best used Capacity rate n utilizatio Capacity =
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Capacity Utilization 4 Example: Engineers design engines and assembly lines to operate at an ideal or “best operating level” to maximize output and minimize ware Underutilization Best Operating Level Average unit cost of output Volume Overutilization
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n During one week of production, a plant produced 83 units of a product. It was designed to produce 120 units per week. What is this plant’s capacity utilization rate?
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BusM 361 Capacity Management Fall 11 - BusM 361: Strategic...

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