Augmentation of Capacity

and Decision Tree for

Capacity Planning
Introduction: Augmentation of Capacity
1 What is Capacity Augmentation?
Capacity augmentation is the process of
increasing the production capability of a
system or organization to meet growing
demands and improve efficiency.
2 Why is it Important?
In today's competitive business
landscape, capacity augmentation is
crucial for meeting customer demands,
staying ahead of the competition, and
achieving business growth.
Capacity Planning
1 Definition 2 Types
Capacity planning is the process of Capacity planning can be strategic, tactical,
determining the required production or operational, depending on the time frame
capacity to meet current and future and level of detail considered.
demands while optimizing resource
utilization.
Decision Tree for Capacity Planning
Step 2: Forecast Demand
Anticipate future demand based on
market trends, customer behavior, and
historical data.
Step 4: Explore Options
Consider various strategies like
outsourcing, expansion, process
improvement, or technology adoption
to bridge the capacity gaps.
1 Step 1: Assess Current Capacity
Evaluate existing capacity utilization,
identify bottlenecks, and determine if
2 current capacity meets demand.
3 Step 3: Analyze Gap
Compare current capacity with
forecasted demand to identify capacity
4 gaps.
Step 5: Implement and Monitor
5
Execute the chosen capacity
augmentation strategy and
continuously monitor its effectiveness.
Real-Life Example of Capacity Planning

Production Line Warehouse Capacity IT Infrastructure Scaling

Optimization
A manufacturing company used
capacity planning to optimize its
production line and achieve a
30% increase in output, meeting
growing customer demands.
Expansion
A distribution center leveraged
capacity planning to expand its
warehouse facility, resulting in
efficient inventory management
and improved order fulfillment.
An IT company utilized capacity
planning to scale its server
room, ensuring high-
performance and uninterrupted
service to its customers.
Importance of Decision Tree in
Capacity Planning
1 Visual Representation
A decision tree provides a clear visual
representation of the capacity planning
process, making it easier to understand
and communicate.
2 Informed Decision-Making
A decision tree helps decision-makers
consider various options and potential
outcomes, enabling them to make
informed decisions.
Benefits and Challenges of Capacity
Augmentation
Benefits
Increased productivity, improved customer
satisfaction, enhanced competitiveness,
better resource optimization, and greater
scalability.
Challenges
Cost implications, potential disruption in
operations during implementation,
accurate demand forecasting, and effective
capacity utilization.
Conclusion: Key Takeaways and Next Steps
1 Key Takeaways
Capacity augmentation is crucial for
business growth. Decision trees provide a
structured approach to capacity planning.
2 Next Steps
Assess your organization's current capacity,
forecast demand, analyze gaps, and explore
capacity augmentation strategies.