Capacity Planning Software

A wide variety of businesses must grapple with capacity management. Leaders can't simply drop a massive workload on employees and expect to meet a deadline without considering dozens of factors.

In manufacturing production, labor hours, raw materials, tools and equipment, storage and other resources must be carefully assessed before work even begins. All of these moving parts make up capacity—a critical element for production efficiency.

Software can assist companies in applying the complex algorithms to disparate aspects of production operations to meet demand seamlessly. This buyer's guide is designed to help you learn more about the capabilities of capacity planning systems.

We'll cover:

What Is Capacity Planning and Management Software?
Common Functionality of Capacity Planning and Management Software
What Type of Buyer Are You?
Benefits of Capacity Planning and Management Software

What Is Capacity Planning and Management Software?

In the most basic terms, capacity planning systems help companies compare production loads with available capacity within a specific time frame. The process of planning for capacity helps avoid bottlenecks in production, which can impact the entire supply chain.

With data about required materials, equipment availability and man hours and costs, the software is able to spread out production needs across available machine capacity in order to meet demand, on time.

There are some important terms related to capacity planning:

• Infinite vs. finite capacity planning. These are the foundational concepts of capacity planning—infinite capacity assumes no limits on resources needed to produce enough units to meet demand. However, finite capacity factors in the constraints involved in real-world production situations.
  
  For example, planners may know that a particular machine on a production line is only available for a maximum of, say, 10 hours during a normal shift. This is one kind of limitation that impacts capacity planning.
  
  Thus, capacity planning software helps by scheduling around real-time constraints and other conditions that can impact production, instead of simply planning based on a baseline capacity level.
  
• Production load leveling. Demand isn't always constant for manufacturers. In the case of fluctuating demand, it's necessary to maintain a smooth production workflow, which may include shifting capacity to "level" production across a few days instead of packing it all into one, or by expanding capacity by adding extra shifts or utilizing external capacity to meet demand (by using another manufacturing plant, for example).

Common Functionality of Capacity Planning and Management Software

These systems only have a few individual components, but each one provides useful insights about how to arrange your available capacity to meet production goals. These features often include:

What Type of Buyer Are You?

Any software purchase comes with several considerations and questions to ask. Identifying the type of buyer you are helps answer many of those. Below are some of the most common buyer types:

ERP suite buyer. Enterprise resource planning systems (ERPs) are complex platforms to assist manufacturers (and a wide variety of other types of businesses) by integrating data from all departments to gain a holistic view of operations. This software takes into account the many seemingly unrelated factors that can impact production schedules.

Many modern ERP systems offer capacity planning functionality, and use the wealth of collected data to predict potential issues in production that could impact capacity decisions.

MES buyer. Similarly, stand-alone manufacturing execution systems (MESs) typically offer a capacity planning component. Where an ERP gathers and analyzes information about an entire organization, an MES is hyper specific to that company's manufacturing process—maintaining production assets, dispatching production plans and improving quality of the finished product.

Since this type of software is so particular to the manufacturing type, it's often purchased by itself to integrate with an existing ERP. If you're buying an MES, you likely have the capacity planning functionality you need.

Make-to-order manufacturer. These types of companies begin production only after receiving a work order, so capacity planning is more crucial for these organizations than for those that continuously produce units.

In these situations, manufacturers have a short window to plan for capacity, but software can assist with leveling the load and factoring in other available resources necessary to meet production deadlines.

Benefits of Capacity Planning and Management Software

We've talked about the key benefit of automating the complex issue of capacity planning, but the software also offers some complementary benefits:

• Optimize the use of assets. Especially for manufacturing plants with a variety of asset types, or different versions of the same type of asset, a capacity planning system can help prioritize jobs. This can lower production costs by shifting jobs to equipment that is less expensive to operate depending on the type and time frame of manufacturing.
  
• Spot production bottlenecks. During capacity planning, the software can help identify specific assets or processes causing slowdowns or inefficiencies. The system's recommendations for prioritizing or spreading out work may reveal these bottlenecks.
  
• Boost the useful life of assets. Because capacity planning helps level the workload, the tasks aren't placed solely on one or two machines, so assets and equipment are likely to operate a good condition for longer.