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Process capacity

memorize.ai (lvl 286)

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Section 1

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Overcapacity

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Last updated

6 years ago

Date created

Mar 1, 2020

Cards (30)

Section 1

(30 cards)

Overcapacity

Front

Capacity>actual demand Causes severe competition, loss from falling price, dumping

Back

S

Front

Setup time (in hour) per lot

Back

Setup time

Front

The time required to change a process or an operation from making one service or product to making another

Back

capacity leads demand

Front

Stay ahead of demand to minimize the chance of sales lost derived from insufficient capacity :) can respond quickly to rapid changes in the market :) preempt the market :) economies of scale :( expensive and risky :( over-investment, idle time, financial risk...

Back

Output measure

Front

The simplest way to express capacity Number of products produced or customers served per unit of time

Back

Q

Front

Number of units in each lot

Back

Capacity cushion

Front

1-utilization Amount reserve capacity a firm uses to handle sudden increases in demand or temporary losses of prouction capacity Buffer against uncertainties

Back

capacity planning

Front

the process of establishing the output rate that can be achieved by a facility

Back

D

Front

Demand forecast for the year : number of customers served or units produced

Back

Capacity requirement

Front

What its capacity should be for some future time period to meet customers' demand, given the desired capacity cushion

Back

Capacity gap

Front

Required capacity - available capacity Any difference! Positive or negative

Back

Efficiency

Front

The percent of effective capacity achieved (actual output / effective capacity) x 100

Back

Tactical issues of capacity planning

Front

How to plan workforce and inventory levels, & day-to-day use of equipment

Back

Design(engineering) capacity

Front

maximum attainable output under ideal condition

Back

Chance nodes

Front

Circles in decision trees

Back

Economies of scale

Front

Increasing output rate reduces average unit cost : spreading fixed costs over more units : construction cost reduction : raw material quantity discount : process advantage

Back

Strategic issues of capacity planning

Front

How much and when to spend capital for additional facility and equipment

Back

N

Front

Total number of hours per year during which the process operates

Back

Decision nodes

Front

Squares in decision trees

Back

Undercapacity

Front

Capacity<actual demand Causes lass of sales opportunity

Back

Utilization

Front

The percent of design capacity achieved (Actual output/design capacity) x 100

Back

Decision trees

Front

Tree diagramming to decide either to maximize profit or minimize cost Identify all decision nodes and alternatives for each decision Identify all chance nodes that can occur after each decision Working from left to right

Back

C

Front

Desired capacity cushion (Expressed as a percentage)

Back

[Dp+(D/Q)s}/N[1-(c/100)]

Front

Capacity requirement in input measures

Back

Input measure

Front

Typically based on resource availability : availability of workers, machines, workstations, seats ...

Back

Effective capacity

Front

maximum attainable output under normal(realistic) conditions given break time, scheduling difficulties, machine maintenance...

Back

Capacity lags demand

Front

Lags behind demand, relying on short-term peak capacity options to meet demand :) reduce financial risk associated with overly optimistic demand forecast :) increase utilization, return of investment(ROI) :( unable to respond if demand is unexpectedly high :( increase the costs for short-term options :( being preempted by a competitor

Back

Capaacity

Front

Maximum rate of output of a process or a system. Operation system's ability to meet customer demand given a time horizon

Back

Diseconomies of scale

Front

Increasing output rates increases average unit cost : complexity : loss of focus

Back

P

Front

Processing time (in hours per customer served or units produced)

Back