Capacity Management in Operations Systems

This technical note discusses how to analyze and manage the capacity of an operations system. The main reason for analyzing capacity is to find the answer to this question: what is the maximum amount of money an operations system can generate (via products or services)? The note presents a general methodology for capacity analysis, illustrated with a variety of examples, which present typical real-life complexities such as batch production, non-sequential production, production of mixed items, etc. Finally, as a supplement to the numerical capacity analysis, it outlines a methodology for supporting the capacity improvement process in an operations system.