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The operations management strategies outlined in this section outline specific tools organisations use to reach their set objectives. This section will review:
facilities location planning, and
Capacity planning is concerned with determining the level of human and other resources that will be necessary to meet the production targets of the organisation. It is concerned with establishing the maximum output capability of an organisation in a given time period.
There are several ways that organisations can increase capacity. These include:
creating additional shifts and hiring more employees, or outsourcing to contractors
getting current staff to work overtime
outsourcing to other organisations
increasing plant and machinery
building up inventory and taking back orders from customers
Facilities encompass the land, buildings, plant and equipment, and other major physical inputs that substantially determine productive capacity and involve significant capital investment. Facilities issues confronting managers focus mainly on expansion and contraction decisions, facilities location and facilities layout.
The preferred location of the facility will be determined by the availability of employees with specific skills, government zoning regulations, employee costs, environmental regulations, utility costs and proximity to suppliers and markets.
Once a product or service has been designed, the organisation must plan for its actual production. This involves assessing the production methods currently available (e.g. project, batch or continuous) and determining which of these is appropriate for the organisation.
This decision will be based on the nature and number of goods or services to be produced, the space available and the activities that need to be carried out by employees in the actual production process. This will also involve determining the layout of the organisation's facilities and how they will be used in the production process.
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