The term capacity in business environment refers to the amount of output a business system can be able to make within a specific period. For instance, it can be the number of customers who a system can handle per hour on the side of service providing businesses or the number of products that a system can be able to produce per day on the side of manufacturing industry. To come up with a viable capacity plan, there is need to put into consideration the amount of resources required and the amount of products produced.
Lean production, on the other hand, refers to a combination of activities aimed at increasing production volume and at the same time cutting down on the amount of work and raw materials. Based on lean production, no product needs to be produced unless it is required. This paper is aimed at coming up with a discussion of strategic capacity planning and lean production for a new process design and supply chain for electric fans at Riordan.
In developing capacity planning and lean production for the new process and supply chain, there are some considerations that need to be put in place. These include maintaining system balance, flexibility of the capacity and external sources of the capacity. In a balanced capacity system, output of stage one in the process becomes the input of the second stage and so on. In most cases, it becomes hard to achieve this because of the difference in operation levels in the process (Bakke & Hellberg, 1993, p. 245).
There is need for improvement of capacity to stages that appear to be constrained to cater for these problems. This can be through buying of additional capacity for the process or scheduling overtime. To help in making sure that the process is not interrupted, one can use buffer inventories on stages likely to face some constraints. One needs to ensure that it is possible to improve capacity in the new process. One should ensure that the process does not require frequent upgrading of capacity as this can be expensive to the organization.
The processes need to ensure that no unnecessary resources or products are used. It is important to ensure that only the require resources in terms of workers, raw material, and equipments are used in the process. The process requires not producing excess electric fans as some may go to waste. The time required from one stage to the other in the process needs to be greatly minimized in the process. This can be through placing linked stages close to one another.
During transportation of products, much time is wasted.. The supply chain process needs to be efficient as much as possible. This can be achieved by ensuring that the process is consistent with the electric fan demand. This would ensure that always there are enough products to be supplied. Efficiency in the system also can be achieved by balancing activities involved in the process (Bakke & Hellberg, 1993, PP. 250-260).
Riordan management team needs to ensure that it has separated activities that require a large amount of work from those that does not and assign them to separate stages, which do not depend on one another. Through ensuring that no productive activity is removed, efficiency in supply chain process can be improved. To make better use of the production and distribution capacity, Optimization techniques can be integrated in the process. Improvement in information transfer in the supply chain can be made possible through providing information linkages in the process. With this entirely put in place, Riordan can be able to come up with an effective capacity plan and lean production for its electric fans.
Reference list
Bakke, N. A. & Hellberg, R. (1993). The Challenges of Capacity Planning. International Journal of Production Economics, 30, pp. 243–64.