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Capacity Planning

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Capacity Planning
CAPACITY PLANNING

ALLAMA IQBAL OPEN UNIVERSITY (AIOU) ISLAMABAD
PREPARED BY: HUMA NOOR (REG: AO595884) PREPARED FOR: MISS SANOOBAR
SUBJECT NAME: PRODUCTION AND OPERATION MANAGEMENT SUBJECT CODE: 8509
STUDY CENTURE: UNITEC (ISLAMABAD)

To my dearest and best friend’’ Raheela Khan’’…..Who support me and help me in making report. My family especially my ‘’Mother,’’…….who encourage me and because of whom I’m here for higher education and only with her support and prayers I have come to be a successful professional and good human being. My all friends, with their best wishes and prayers I’m going forward toward my goals and my all teachers who encourage and support us.

Capacity planning is the process of determining the production capacity needed by an organization to meet changing demands for its products. In the context of capacity planning, "design capacity" is the maximum amount of work that an organization is capable of completing in a given period, "effective capacity" is the maximum amount of work that an organization is capable of completing in a given period due to constraints such as quality problems, delays, material handling, etc. The phrase is also used in business computing as a synonym for Capacity Management. We have discussed the Capacity planning in Nestle in this report. The problem of seasonality and demand fluctuation also affects Nestle – the chocolate giant. Demand for chocolate increases mainly during the winter season (around Christmas and Easter holidays) and drops off during the summer. The company uses level capacity plan to deal with demand fluctuations by keeping some products in storage for season peaks.
Capacity management and planning during the crisis of seasonality at Nestle is a major issue. The company uses a combination of various capacity plans (depending on the situation) to adjust demand and fight seasonality.

Capacity
Capacity is the ability to hold a fluid,

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