What is capacity, RCCP, and CRP

1. Capacity
Management
Fakheem Tariq
17-NTU-1524

2. What is capacity ?
The throughput or number of units a facility can hold,
receive, store or produce in a period of time.
(e.g. 1 million garments per month)

3. Capacity
Management
 The ability to meet a customer’s requirements with the
available resources (machinery, labour, raw material
etc.) at hand.
 Capacity planning is done on the basis of projections for
future product demand, labour and equipment's
requirements.
 Time and capacity are the two main constraints in
capacity management.

4. Rough cut
capacity planning
 It calculates a rough estimate of the workload placed on
critical resources by the proposed MPS.
 Critical resources include bottleneck operations, labor
and critical materials.
 Basically there are three approaches to perform rough
cut capacity planning:-
1. Capacity planning using overall factors
2. “Bill of labor” approach
3. “Resource Profile” approach

5. Capacity
requirement
planning
(CRP)
 It is the process by which a company figures out how
much it needs to produce, and determines if it is capable
of meeting those production goals.
 Small businesses must conduct capacity requirements
planning regularly to keep up with changes in supply
and demand.
 Depending on the industry and type of businesses,
capacity requirements planning can happen monthly,
quarterly or annually.

6. Capacity
requirement
planning
(CRP)
 It is necessary to set the capacity after considering the
current situation, in order to make Capacity requirements
Planning more practical.
 In this planning, the following three capacities are
used:
1. Standard Capacity
2. Maximum Capacity
3. Set Capacity

7. Effect of poor
CRP
 Not being able to meet customer demand will often mean
losing customers to competitors.
 Poor capacity requirements planning can also lead to
over-production of products that do not sell.
 This unused inventory ties up the company’s revenue and
depresses reported earnings.

8. Thank you!