“If I invest significant resources to capacity planning, then I understand the production capacity needed to meet the changing demands, but I am not sure what capacity planning really entails.”
My morning is never complete without a cup of coffee. So, when I first came across the term “capacity planning,” I automatically went to my regular morning struggle, how much coffee can I put into this travel mug without burning myself? This might seem trivial, but it is a delicate process. How big is the mug? Do I want to leave room for cream? How much cream? If your calculation is even slightly off you burn yourself at some point, have a subpar cup of joe, or you managed to cheat yourself out of some coffee.
After some research, I now understand that capacity planning is slightly more complex than filling up a cup of coffee. Capacity planning is the process of determining the production capacity needed by an organization to meet changing demands for its product or services. The goal of capacity planning is to understand the capacity of the organization, and the demand of the customer, to minimize a discrepancy between the two forces.
If only it was as easy as filling your travel mug in the morning, but really, most of capacity planning comes down to two questions. Given the resources I have, how many projects can I do? Given my projects, how much resources do I need?
You might be reading those two questions and think it is that easy, but just like pouring coffee, there are lots of variables involved. The cream to coffee ratio and the size of the travel mug, turns into skill sets, number of projects, strategic plans, as well as the number of resources. If the path to high performance is a pipe, then each of these variables are something blocking the flow.
The key to successful capacity planning is identifying the biggest blockage. You could have a reasonable number of employees and projects, but have a gap in the job roles that can be filled by your resources. Alternatively, you could have resources that are being severely overworked. You have too many projects and not enough resources, in which case, you can reevaluate the number of future projects that can be attempted. The first step to unplugging the pipe or filling that mug is to understand what you have, and what you can do with it, and that is capacity planning.
The luckiest of us out there no longer need to worry about filling up our coffee mugs to the appropriate level. We have Starbucks or an automatic machine that fills our cups to that perfect full, but not too full point. If only real world capacity planning were the same way. The more you understand the more you can plan for at your organization. Capacity planning ensures the long and short term success of key business initiatives at a reduced cost, and who doesn’t want that?