Chapter 5 Capacity Management Flashcards
the amount of resource inputs available relative to output requirements over a particular period of time
capacity
what are the 3 durations in which capacity planning is viewed
- long range - greater than one year
- intermediate range - monthly or quarterly plans for the next 6-18 months
- short range - less than one month
finding the overall capacity intensive resources to best support the firms long term strategy
strategic capacity planning
the level of capacity for which the process was designed and the volume of output at which average unit cost is minimized
best operating level
measure of how close the firms current output rate is to its best operating level (percent
capacity utilization rate
capacity used/best operating level
capacity utilization rate
idea that as the plant gets larger and volume increases, the average cost per unit drops. At some point, the plant gets too large and cost per unit increases
economies of scale
can a plant become too large
yes and diseconomies of scale become a problem
a facility designed around a limited set of production objectives. Typically the focus would relate to a specific product or product group
focused factory
an area in a larger facility that is dedicated to a specific production objective. This can be used to operationalize the focused factory concept
plant within a plant (PWP)
having the ability to rapidly increase or decrease production levels, or to shift production capacity quickly from one product or service to another
capacity flexibility
zero-changeover-time plant, using movable equipment, knockdown walls, and easily accessible and reroutable utilities, such a plant can quickly adapt to change
flexible plants
epitomized by flexible manufacturing systems on the one hand and simple, easily set up equipment on the other
flexible processes
when multiple product can be produced at Lower cost in combination that they can be separately
economies of scope
have multiple skills and the ability to switch easily from one kind of task to another
flexible workers
what are the 2 types of costs to consider when adding capacity
- the cost of upgraading too frequently
- cost of upgrading too infrequently
capacity in excess of expected demand
capacity cushion
a schematic model of the sequence of steps in a problem and the conditions and consequences of each step
decision tree
the average number of customers that come to a facility during a specific period of time
arrival rate
the average number of customers that can be processed over the same period of time when the facility is operating at maximum capacity
service rate
obtain (goods or a service) from an outside or foreign supplier, especially in place of an internal source
outsourcing
capacity that is designated to be used in part for the Devices, including components or parts thereof, and in part for other purposes
sharing capacity
