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How do you create a Capacity Planning mindset at work?

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Capacity planning is the process of ensuring that your resources, such as staff, equipment, and infrastructure, match the current and future demands of your customers and stakeholders. It can help you optimize your performance, avoid waste, and prepare for growth or change. But how do you create a capacity planning mindset at work, so that you and your team can make informed decisions and plan ahead? Here are some tips to help you develop this skill.

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Anil Ojha

Executive Director | Specialty Chemicals

1 Understand your goals

The first step to creating a capacity planning mindset is to understand your goals and objectives, both short-term and long-term. What are you trying to achieve, and how do you measure your success? How do your goals align with the vision and mission of your organization? Having a clear picture of your desired outcomes can help you prioritize your activities and resources, and identify any gaps or risks that might affect your capacity.

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Anil Ojha

Executive Director | Specialty Chemicals
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Capacity building is about understanding the value proposition and gauging whether it would be accepted by the marketplace to do that you must link capacity building with strategy.

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2 Know your capacity

The next step is to know your current and potential capacity, which means the amount and quality of work that you and your team can produce or deliver within a given time frame and budget. You can use various methods and tools to assess your capacity, such as historical data, benchmarking, forecasting, and modeling. You should also consider factors such as availability, skills, productivity, and efficiency of your resources, as well as any constraints or dependencies that might limit your capacity.

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Alfred H (Fred) Everson III

Experienced: Controller, Cost & G/L Accountant
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Get buy in from stakeholders (customers, C - Suite etc.) on general capacity limitations by "area". How many days / week? How much PTO (avg. / employee)? How many shifts / day? How many hours / shift? Efficiencies (machines - allow maintenance time)?, fatigue factor of employees? Nailing this down makes it MUCH easier to calculate capacity over time and locate your production bottlenecks. DON'T FORGET TO FACTOR IN VENDOR CAPACITY (purchased parts)!

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Anil Ojha

Executive Director | Specialty Chemicals
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Aligning goals to the strategic intent of the organization is the key to goal setting. Strategy is different from plans, it is a theory in the marketplace, a theory that postulates and derives from facts and logic based on experiences and extrapolation. The logic becomes more comprehensive with new inputs that help move forward the theory. Therefore, it is essential to test the theory and realign it in the marketplace.

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3 Monitor your demand

Another key step is to monitor your demand, which means the level and type of work that you and your team are expected or required to perform or deliver by your customers and stakeholders. You should track and analyze your demand patterns, such as volume, frequency, variability, and complexity, and anticipate any changes or fluctuations that might occur due to internal or external factors. You should also communicate with your customers and stakeholders regularly, and understand their needs and expectations.

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4 Balance your capacity and demand

Once you have a good understanding of your goals, capacity, and demand, you can create a capacity plan that balances your resources and workload, and aligns with your objectives. You can use various strategies and techniques to balance your capacity and demand, such as prioritizing, scheduling, delegating, outsourcing, automating, scaling, or adjusting. You should also review and update your capacity plan periodically, and make adjustments as needed based on feedback and performance.

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5 Learn and improve

The final step to creating a capacity planning mindset is to learn from your experience and improve your process and outcomes. You should measure and evaluate your results, and compare them with your goals and expectations. You should also identify and address any issues or challenges that might affect your capacity or demand, such as bottlenecks, errors, delays, or changes. You should also seek and apply feedback and best practices from your customers, stakeholders, peers, and experts, and look for opportunities to innovate and optimize your capacity planning.

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6 Here’s what else to consider

This is a space to share examples, stories, or insights that don’t fit into any of the previous sections. What else would you like to add?

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Anil Ojha

Executive Director | Specialty Chemicals
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Goals for the teams are aligned with the strategic intent and tactics. It is a part of the annual planning exercise. This has to be dwelled to the deepest possible level and look at all possible angles that need to be covered. The resources, capabilities, and core competencies are examined for gaps and only when those are filled, there can be an optimistic chance of achieving the set goal. Aligning strategic intent with capacity building and deep diving to create purpose for the execution teams based on the cultural aspects is very important.

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How do you create a Capacity Planning mindset at work?

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3

4

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1 Understand your goals

2 Know your capacity

3 Monitor your demand

4 Balance your capacity and demand

5 Learn and improve

6 Here’s what else to consider

Capacity Planning

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