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MGMT 541
Case study: Fitness Plus Part A.
3/29/2016
Christopher Sleiman
equipments are especially in the cardiovascular and nautilus and by that replace the least popular
machines with more wanted machines.
2. There are 3 capacity strategies:
- Level capacity: The capacity is maintained at a constant level all along the planning period and
any fluctuations in demand are ignored. At Fitness Plus there is always a possibility of a large
number of members coming in any time and thus this strategy would not work.
-chase demand: Chase demand is opposite to level capacity as it tries to match the capacity
levels according to the changing demand patterns. This method requires adjustment of capacity
through different means like offering over time in peak and lesser hours in off-peak periods, or
opening up a new facility that will also chase the increase in demand which is expected due to
new businesses down town.
-demand management: The objective of this strategy is to shift the burden of peak period to
off-peak period. Either the demand is changed through various methods or alternate products or
services are offered to fill off-peak capacity.
The most appropriate capacity strategy is the chase demand strategy that will add capacity in the
face of exiting demand especially that there is resurgence of activity in the area where new
offices and were moving back, and also because sports has become something wanted by
everyone and the demand for it is growing.
3. Operating decisions are short term decisions by the company in lieu of long term
strategies as these involve day to day operations and therefore need to be addressed
before any grand scheme issues. Capacity decision is linked to the operating decisions