Importance Of Capacity Planning

Capacity Planning can be subject to change at any time. More than being a major concept of operations management, it is a key component in location and company convenience. The direct relation to operations management is quite direct. In order to determine how much space is needed is to be determined by operations management. The facility location needs to be in a highly beneficial demographical location. This could mean a Ford plant be located in a state or country where cars in highest in demand. Specific areas such as Africa would not need tons of transportation use because of the lack of roads and necessary financial stability. Not that these countries and locations don't need cars, but if less than a certain percentage of cars made will …show more content…
"Capacity planning sits between demand (including product
Ford the Prestigious Hunt 6 development), sales and marketing, and supply "(DuBois). As mentioned capacity planning relies solely on the demand for a product. This can be so there is little possibility for wasted space. As discussed in one of the class discussions, shelf space is very important so that if demand is high it can be handled immediately and replenished if an item is purchased from the shelf. The same principle applies to Ford, the more cars purchased the more that can be replaced and on a continuous cycle it remains. Capacity planning can resolve many issues. One of these would be handling a surplus of the amounts of cars being produced. Understanding which cars are being sold most at what times of the year can solve so many issues, and have much less cars at a dealership just sitting. More likely than not you're going to need winter fitting vehicles more towards the later months and early months of the year seeing that roads and whether conditions are more suited for these vehicles at this time. Capacity planning can make sure that the right amounts of cars are placed within their respective regions in order to keep …show more content…
A rather intelligent point was made directed towards capacity planning, "The 2008 downturn hit suppliers extremely hard, putting some out of business. But in 2010, an upturn in demand in emerging regions like Brazil, India and China meant capacity required varied significantly by region" (DuBois). This quote is pointing out the significance that other countries have allowed the expanding of Ford to emerge over the years. It is showing that even after the downturn during 2008, the continuous expanding of Ford has still reached out further and further and now the demand has increased. Ford's plan is to be at the top globally and with capacity planning and accurate demographics this can be achieved. As simple as it may sound the task is business threatening due to U.S. having a much better financial stability per person than most other