LAW 122 Lecture Notes - Lecture 1: Uptime, Potential Output, Indian Railways
31 Oct 2017
School
Department
Course
Professor
Document Summary
Capacity: is the upper limit on the workload that an operating unit can handle. An operating unit might be a plant, department, machine, store or worker. Capacity decision is usually measured as maximum production rate. Strategic capacity planning: is the systematic determination of facility and major machine/equipment requirements to meet long-term demand for goods and services. Involves substantial financial and other resources; must plan far in advance. Better to choose a measure of capacity that does not require updating. When one product is involved; the capacity of the productive unit is the item. When multiple products are involved; using a simple measure of output can be misleading. Better way is to use the availability of a major input as capacity. Used to estimate the throughput capacity of a productive unit from its size: 28 tonnes; 15 minutes throughput capacity = 28/0. 25 = 112.
