Long-term capacity management: Linking the perspectives from manufacturing strategy and sales and operations planning

Long-term capacity management: Linking the perspectives from manufacturing strategy and sales and operations planning

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Article ID: iaor20013266
Country: Netherlands
Volume: 69
Issue: 2
Start Page Number: 215
End Page Number: 225
Publication Date: Jan 2001
Journal: International Journal of Production Economics
Authors: , ,
Keywords: capacity planning
Abstract:

Efficient long-term capacity management is vital to any manufacturing firm. It has implications on competitive performance in terms of cost, delivery speed, dependability and flexibility. In a manufacturing strategy, capacity is a structural decision category, dealing with dynamic capacity expansion and reduction relative to the long-term changes in demand levels. Sales and operations planning (S&OP) is the long-term planning of production levels relative to sales within the framework of a manufacturing planning and control system. Within the S&OP, resource planning is used for determining the appropriate capacity levels in order to support the production plan. Manufacturing strategy and sales and operations planning provide two perspectives on long-term capacity management, raising and treating different issues. In this paper, we compare and link them in a framework for long-term capacity management.

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