NOTE: ONLY PART V AND VI WILL BE ANSWERED.

I. Learning Objectives

After completing this chapter, you should be able to:

LO1.1 Name the three key questions in capacity planning.
LO1.2 Explain the importance of capacity planning.
LO1.3 Describe ways of defining and measuring capacity.
LO1.4 Name several determinants of effective capacity.
LO1.5 Discuss the factors to consider when deciding whether to perform in-house or
outsource.
LO1.6 Discuss the major considerations related to developing capacity alternatives.
LO1.7 Describe the steps that are used to resolve constraint issues.
LO1.8 Briefly describe approaches that are useful for evaluating capacity alternatives.

II. Assessment

GRADING RUBRIC FOR ESSAYS

ADDRESSING THE TOPIC PROVIDES EVIDENCE

Range from 0 to 10 points Range from 0 to 10 points

0-4 mentions the topic in a few words misses the point 0-4 provides a few pieces of evidence
almost entirely
5-6 provides evidence directly related to the issues/events
5-6 mentions the topic and provides a few remarks about
the topic 7 provides evidence that supports a summary of the
events/issues
7 addresses the main issues identified in the statement
8 provides evidence that fully supports a general case for
8 fully addresses the main issues in the statement and the topic
some secondary issues

9 provides evidence that fully supports a clearly described

9 fully addresses the main issues, distinguish key points in case for the topic and anticipates counterexamples or
secondary issues and provides some context for the points views

10 fully addresses the statement including all the main 10 provides evidence that fully supports a clearly
issues, the secondary issues and explores the historical described case for the topic and anticipates
context and meaning over time counterexamples, alternate interpretations or views and
provides discussion of evidence

LOGICAL CONNECTIONS/ANALYSIS CONCLUSIONS

 Range from 0 to 10 points Range from 0 to 10 points

0-4 provides a few comments on evidence or general
meaning of topic
5-6 provides direct connections of evidence related to the
issues/events
7 provides logical connections that supports a summary of
the evidence and relates it to the events/issues
8 provides discussion or analysis links evidence and
discussion/analysis that fully supports a general case for
the topic
9 provides discussion/analysis that fully supports a
logically coherent and clearly delineated case for the topic
and anticipates counterexamples or views and context
10 provides analysis of evidence that fully supports a
logically coherent and clearly described case for the topic
and addresses counterexamples, alternate interpretations
or views and provides discussion/analysis of all of the
evidence and the historical context
0-4 provides a few summary concluding remarks
5-6 provides conclusion with some evidence directly
related to the issues/events
7 provides logically connected conclusion with evidence
that supports a summary discussion of the events/issues
8 provides concluding paragraph with evidence that fully
supports a logical general case for the topic
9 provides separate concluding paragraph that fully
supports a clearly described logical case for the topic and
anticipates counterexamples or views within the context
of the topic
10 provides a separate concluding paragraph which fully
supports a clearly described and logically coherent case
for the topic and anticipates counterexamples, alternate
interpretations or views and provides discussion of
evidence and the changing historical context of the
topic/issues

The rubric above and the explanation of the scores for each quadrant of the rubric
should help guide you in understanding what is being graded in each essay.  While
spelling and grammar are not specifically mentioned in the rubric, they are graded
on the assumption that everyone is attempting to write college level papers.

III. Learning Materials

NOTE: All learning materials are located in your google classroom.

Instructional Content Resources/Tips

Digital Media: TV Clips/YouTube Stream videos

Presentation Materials: PowerPoint Download ppt

IV. Summary

Capacity refers to a system’s potential for producing goods or delivering services

over a specified time interval. Capacity decisions are important because capacity is a
ceiling on output and a major determinant of operating costs.
 Three key inputs to capacity planning are the kind of capacity that will be needed,
how much will be needed, and when it will be needed. Accurate forecasts are critical
to the planning process.
The capacity planning decision is one of the most important decisions that
managers make. The capacity decision strategic and long-term in nature, often
involving a significant initial investment of capital. Capacity planning is particularly
difficult in cases where returns will accrue over a lengthy period and risk is a major
consideration.
A variety of factors can interfere with effective capacity, so effective capacity is
usually somewhat less than design capacity. These factors include facilities design
and layout, human factors, product/service design, equipment failures, scheduling
problems, and quality considerations.
Capacity planning involves long-term and short-term considerations. Long-term
considerations relate to the overall level of capacity; short-term considerations relate
to variations in capacity requirements due to seasonal, random, and irregular
fluctuations in demand. Ideally, capacity will match demand. Thus, there is a close
link between forecasting and capacity planning, particularly in the long term. In the
short term, emphasis shifts to describing and coping with variations in demand.
Development of capacity alternatives us enhanced by taking a systems approach
to planning, by recognizing that capacity increments are often acquired in chunks, by
designing flexible systems, and by considering product/service complements as a way
of dealing with various patterns of demand.
In evaluating capacity alternatives, a manager must consider both quantitative and
qualitative aspects. Quantitative analysis usually reflects economic factors, and
qualitative considerations include intangibles such as public opinion and personal
preferences of managers.
 V. Critical Thinking and Discussion Questions

Instruction: Please read the scanned material for this part. Times New Roman Font Size
12, 1.5 lines for spacing, justify. Maximum of 2 paragraphs for each question. This items
also will appear in every chapter. It allows you to critically apply information you learned
in the chapter to a practical situation.

1. How do long-term and short-term capacity considerations differ?

2. Why is it important to adopt a big-picture approach to capacity planning?

3. How do capacity decisions influence productivity?

4. Briefly discuss how uncertainty affects capacity decisions.

5. Why is capacity planning one of the most critical decisions a manager has to
make?

VI. Reflection

The learners will write their personal insights about the lesson using the prompts below

I understand that
________________________________________________________________________
________________________________________________________________________
________________________________________________________________________
____________________________________________________________

I realized that
______________________________________________________________________________
______________________________________________________________________________
____________________________________________________________
 VII. References

NOTE: Please don’t forget to include your citations here in the references part.

de Ansorena, R. (2009). “How Telefonica Makes Its Management Connections.”

European Quality, Vol. 8, Vol.6, pp. 4-10.

Welch, J.W. (2009). Winning: The Ultimate Business How-To Book. Kindle edition.
HarperCollins e-books.