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# Session 13 Capacity Planning Techniques

## Capacity Planning: Role in MPC Systems Rough Cut Capacity Planning

Capacity Bill Technique Resource Profiles Technique

## Capacity Bill Example

Sarah Reed. master scheduler at Walnut Hill, has developed a master production schedule for the XYZ boom box: Period 1 MPS 450 Dept. Circuit Board Assembly 2 300 3 625 4 890 Hours per Unit of End Product .2 .3

## Capacity 130 160

The XYZ is fabricated in several departments, but the circuit board department and assembly areas are the potential bottlenecks. Prepare a rough-cut analysis of capacity for the MPS.

## Problem 4. Sarah Reed

Period: MPS: 1 450 2 300 3 625 4 890

2 60 90

## Capacity Available 130 hr/per. 160 hr/per.

Requires: MPS, setup time and run time information from product routing file.
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## Resource Profile Example

Determine the capacity requirements in all work centers at Erben Fabricators using the MPS, resource profile, product structure, and lead time information given below for product Z and all of its components. (Assume all usages are one and that a new setup must be made in each period at each work center.)

Product Z MPS Part Z M N O P Work center 201 201 202 202 203

1 10

Period 2 3 4 5 20 15 10 15 Product Z resource profile Setup hours Run hours/unit 8.0 1.5 5.0 1.0 3.0 2.0 2.0 1.0 1.0 0.5

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## Resource Profile Solution

MPS Period Dept Item 201 Z M 202 N O 203 P 201 202 203 -6 -5 -4 -3 -2 -1 15 23 22 6 15 45 6

10

20

15

10

15

11

12 8.5

1 23 25 43 17 8.5 48 60 8.5

2 3 38 30.5 20 15 33 23 12 17

4 5 23 30.5 20 33

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12 8.5

58 45.5 45 40

43 30.5 33

Requires: MPS, setup and run time information from the product routing file, and lead time information.
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## Capacity Requirements Planning (CRP) Example

The Kuczma Company makes sign mounts for commercial customers. One product is the H mount which is made up of a painted surface on both sides of a wooden H frame. The H mount is put together in final assembly. The surfaces are painted in the paint shop, and frame is made in the frame shop. Kuczma wants to estimate the H mount capacity needs for next five periods in final assembly, the paint shop, and the frame shop.

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## Capacity Requirements Planning (CRP) Example (continued)

Period 3 4 20 20 0 30 10 30

Item: H frame Gross requirements Scheduled Receipts Projected available balance Planned order release Q = 30, LT = 1, SS = 0 Item: Painted Surface Gross requirements Scheduled Receipts Projected available balance Planned order release Q = 50, LT = 1, SS = 5 Item: H mount Gross requirements Scheduled Receipts Projected available balance Planned order release Q = L4L, LT = 1, SS = 0

10

1 15 15 10 30

2 20 20 0

5 20 20 0

6 0 20 0

25

1 30 50 45 0

2 40 5 50

Period 3 4 40 40 15 50 25 50

5 40 35 0

6 0 35 0

1 20 25 5 15

2 20 0 20

Period 3 4 20 20 0 20 0 20

5 20 0 20

6 20 0

H Mount Assy

15 15 30 50 0

20

20

20

20

30

30

0.5

50

50

50

0.4

* In hours

## Capacity Requirements Planning (CRP) Example (continued)

Capacity Requirements
Dept H Mount Assy H Frame Painted Surface 1 17 28.5 24

Period 2 3 22 22 0 18 24 24

4 22 18 24

5 22 0 0

6 0 0 0

Note: 28.5 = 3 + 0.5(15) + 3 + 0.5(30) Requires: Planned order and schedule receipt information from the MRP system, and setup and run times from the product routing file.
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Capacity Definitions
Required capacity: Estimated using capacity planning techniques Rated capacity: Available capacity considering staffing equipment capabilities Demonstrated capacity: Actual (or realized) capacity based on actual production output

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## Capacity Planning Techniques: Pros and Cons

Pros Easy to use Minimal computational requirements Consider product mix

Capacity Bills Cons Doesnt consider lead times, inventory information, or gross-to-netting
Less accurate Resource Profiles Doesnt consider inventory information or gross-to- netting

Easy to use Minimal computational requirements Considers lead times Less accurate Consider product mix Capacity Requirements Planning Considers: gross-to-netting, Requires MRP system, Time-phased Inventory information, records, Extensive computational lead times requirements More accurate 12 Considers product mix