Overview

Developing the operation so that it is able to satisfy fluctuating levels of demand, without compromising quality levels, is a fundamental aspect of operations management. This theme looks in more detail at three ways in which organisations seek to do this:

• planning and controlling the capacity of the operation

• planning and controlling inventory so that stock is always available to meet demand

• managing the supply chain, starting with the flow of goods, services and information starting from suppliers and ending with finished products for customers and end users.

You will:

• Explore how to carry out capacity planning and control successfully

• Consider the key issues in inventory planning and control

• Consider JIT and MRP as holistic approaches to inventory planning and control

• Learn about supply chain management and its key components.

Capacity Planning and Control

Capacity planning and control is about the organisation's ability to supply the necessary goods and services to meet the demands of its customers. It is about how to ensure employees, inventory, equipment, processing and scheduling is organised to meet different levels of demand, that is, fluctuations in demand.

Fluctuations in demand are inevitable for any organisation due to daily, weekly, seasonal, micro and macro-economic factors.