Method for Production Capacity Forecasting An Analytical Approach to Identifying Sequentially Chronological Production Constraints

All manufacturers need to understand their overall line's capacity, and each process's capacity, to plan and keep up with growing customer product demand and changing product mix. In addition to keeping up with product demand, it is important to understand future equipment needs for the purpose of forecasting required space, capital, and labor. Many small to medium-sized companies do not have the enterprise resource planning tools, or in-house expertise, to readily develop these production capacity forecasts. The methodology discussed in this paper provides answers to the above business needs by considering the following attributes: •Products manufactured •Expected product demand for the foreseeable future •Process flow for each product •Equipment used for each process •Equipment used for each material movement •Processing rate at each process step •Process yield (scrap rate) at each process step •Equipment reliability (unplanned downtime) and preventive maintenance time •Labor required at each process step and material movement Applying the above attributes, using a common spreadsheet, future needs for equipment, space, capital, and labor are forecasted. Once equipment needs over time are understood, it is also possible to identify a floorplan designed for minimally disruptive growth, opportunities for automation, more sophisticated equipment, reduced work-in-process inventory, and utility usage reduction.