The real demand, the future demand, and the location of the organization are closely linked to the production capacity either in manufacturing companies or in service companies.
We can also say that depending on how we use the production capacity we have, we will influence the quality of the products and the quality of the services provided.
Increase production capacity without knowing how the market moves and without studying customer expectations, we will work blindly and depend on the fate that the future holds for us. We must therefore have forecasts, perspectives, statistical analyzes and above all data on the market to which we aim and which we want to reach and / or maintain.
If this challenge is well attended and understood, it will pay off monetarily, and above all, we will have satisfied customers.
INTRODUCTION
We will demonstrate with concise examples the relationship between demand and production capacity, and the location of organizations.
Our environment is not oblivious to this reality and cannot be abstracted from it. Producers of services and manufactured products must pay attention to these factors, since ignoring them could have an adverse impact on the organization's results.
We are sure that if we know how to use the production capacity we have based on satisfying customer needs, we will place quality products and services on the market, at low cost, and that meet consumer expectations.
Increasing production capacity without knowing demand can surprise us by turning our backs on various factors that will affect cost, quality and the market. Predicting with studies of data, forecasts, prospects, statistical analyzes and the market, among others, will help us in the development of different organizations.
TOPIC I
OPERATING CAPACITY
I.1 - Definition of operations capacity.
It is the maximum ratio of productive or conversion capacity for the existing product combination in the operations of an organization.
Capacity incorporates the concept of conversion rate within an operations scenario. A change in the product mix can change the capacity of the production units. We can measure capacity based on production or based on the inputs used.
I.2 – Ability to operate in manufacturing organizations.
Dairy Trébol: In the industrial plant in Loma Plata, dairy products such as butter, sterilized milk, yogurt, cheeses, etc. are produced.
Based on what has been observed in previous years, we can say that at certain times the plant's production capacity of the aforementioned products is not fully used due to the lack of raw materials, at that time, for this reason, the hand of work normally used in the plant. The dry seasons increase this problem because in those seasons the raw material (milk) is scarce or is adulterated, this adulteration is detected in the laboratories and what can be observed is that it has a high index of water that reduces its productivity of milk. which implies smaller quantities of units produced.
Another factor to take into account is the impossibility of satisfying the demand, especially for cheese. Since it takes a certain time for it to mature and obtain a better quality (aroma, flavor, etc.).
It can be said in general terms that the plant is highly mechanized and automated, that they have adequate transports and that their capacity is within the reasonable margin to reach our market and to export processed products.
Edible oil production plant in Loma Plata: For the consumption of the colony in question and other colonies. Its production capacity is minimal as it targets a specific market, but it is nevertheless a well-assembled plant with adequate equipment (conveyor belts to transport raw material, sorter of raw material, filters, places where sedimentation occurs so as to rinse the oil with chemical additives, etc.).
This plant was installed exclusively for the purpose of supplying edible peanut oil to a minimum group of people. Its capacity is stable and it hardly presents any raw material or labor problems, since the raw material is extracted from the peanut crops of the colony.
I.3 - Operations capacity in two service organizations
Visa and Master Card Credit Cards: The production capacity of these is given by the purchasing power of the people. Having credit cards from certain banks grants status to those who have them. People come for various reasons to own their services, status, not risk having cash in this insecure environment in which we live, the possibility of financing despite having high interest rates, ease and speed.
The wide variety of cards has forced issuing organizations to lower interest rates, there is more dialogue with merchants and it is easier for them to discount sales coupons, retention for card sales is less, these are some of the incident factors in the number of cards issued and the volume of purchases made by cardholders. It is measured by the volume of purchases made by the cardholder, also if he pays everything he bought in the month the issuers cannot apply interest.
Record Service: Company of the group that makes up Record Eléctric SAECA provides services especially to Record Eléctric customers, it constitutes the post-sales technical support of the parent company and monitoring of the equipment sold.
It specializes in the products of the lines of motors, water pumps, welding machines sold by the parent company.
The importance of personnel training is a priority, so technicians and distributors are constantly trained through talks by engineers in the field, courses within the country and courses abroad in the manufacturing plants of imported equipment, in order to to know the production and assembly technology of the same.
Serve with the same deference to other customers who have purchased competing products; in this way they are brought closer to being potential customers of the products offered by the mother company.
In certain parts of the country, it outsources customer service through distributors in order to speed up service and facilitate communication with customers.
The capacity in the production of services must be based on the sales of the mother company.
The tools for maintenance and the testing laboratory must be highly equipped with state-of-the-art technology, trained manpower, and have a fleet of vehicles to quickly get to where the service is needed. Stock of spare parts, TOPIC II
DEMAND VS. CAPACITY
II.1.-. Modification of capacity in an organization, The premise is that " Capacity must be modified based on demand. "
It is important to emphasize that capacity management requires a good understanding of the environment within which the organization operates. This requires an understanding of the normal demands of existing operations and a vision that takes into account future business conditions. Based on these factors, effective managers should consider the following guidelines when planning capacity changes:
- Production Expansion: It is useful to take into account the benefits and costs of overtime, supplementary shifts, part-time support, sub-contracting, and the use of inventories trying to be covered against irregular demands. Alternatives to reduce production and capacity quickly. artificial freezes, layoffs, conclusion of lease and rental contracts and the sale of part of equipment and properties. Product Mix: On the percentage of utilization of the facilities or on the use of labor and costs; which can be extremely helpful in understanding the impact of product mix on capacity. Permanent changes in capacity:It often has far-reaching implications and must be considered with extreme care in relation to the markets, the company's financial position, and technology alternatives. Investments in machinery and equipment, new plants or service centers, product redesign, modifications to the production process, innovations in administration; all of these interact and determine the technology that the organization owns.
Examples: When a new product is launched on the market, future demand should be taken into account based on analyzes carried out by the company's R&D Department or by other means. The product will be developed based on future demand, so the capacity of the plant to develop it must be well studied in the sense of not making unnecessary investments or underestimating the acceptance of the product in the market, which will open the door to competition.
In some cases, it is necessary to modify the product manufacturing process, either to lower costs or to increase quality, or to comply with regulations established by the government, the protection of the environment, or by foreign governments, if the intention of the company is to export its products..
In a recessive economy, there may even be a need to decrease production capacity or even liquidate the organization; However, a new possibility appears; the fusion of technologies such as between Hewelt Packart and Compaq. In the service area of our environment, this type of merger occurred in the financial examples. EFISA Financiera merged with Financiera el Comercio, FIGESA merged with Financiera Familiar, which made its position in the market have improved due to the capital merger.
TOPIC III
CAPACITY PLANNING AND LOCATION
This condition is due to the fact that the demand for many services depends on the location of the system and of course the desired capacity depends on the demand. The location is strategic depending on what you are targeting, what are the objectives of the company and what type of customer you want to reach as well as the type of activity (industrial, commercial or service).
III.1 .-. Influence between Planning and Location in a service organization.
Record Service: Decentralization of customer service due to having customers in various parts of the national territory.
The central house is located in Asunción, therefore, if a client from Alto Paraná depended on the technicians who carry out their tasks arriving at the site to solve the problem, they would wait too long and choose another type of solution to their problems. This drawback is to remedy through Distributors strategically located in different areas of our country such as Concepción, San Pedro, Encarnación, etc., who must be highly qualified and trained in technical areas and to whom state-of-the-art technology must be provided..
With this determination to establish theoretically trained distributors, customers should be satisfied with the speed and quality of the service; however, it is necessary to establish routine controls through the commercial and technical management to see if the distributors satisfy the service needs of the clients located in the area in which they operate, this in order to make decisions to reward or sanction the distributors.
In years of experience, it has been shown that this type of service decentralization has satisfied the company's customers, generating dividends.
III.2.-. Influence between Planning and Location in a manufacturing organization.
Lácteos Trébol: It is an industrial company in which there are industrial wastes, its location is strategic in the sense that it is not located in an urban area, the raw material is on hand (dairy farming establishments) so it is not freight is paid in this regard; the raw material therefore has a lower cost, the communication channels are good, and a fleet of refrigerated trucks is owned to bridge the transportation distance of finished products, labor is cheap, part of the salary is paid in vouchers, there is not a lot of trained labor, but the quality control personnel and those who are in charge of the process are trained. They satisfy the needs of the colonies, arrive in Asunción and export their products.
TOPIC IV
CONCLUSIONS
IV.1.-. General conclusions
- Production capacity depends on demand. Location influences planning or vice versa. Modification of capacity must be studied in detail. Location of industrial plant is strategic
"Production and Operations Management" - Everett E. Adam, Jr. & Ronald J. Ebert -4th Edition.
"Production and Operations Management" - Everett E. Adam, Jr. & Ronald J. Ebert -4th Edition.
"Production and Operations Management" - Everett E. Adam, Jr. & Ronald J. Ebert -4th Edition.
Newspapers from our ABC media, News, Data from the financial superintendence of the BCP, locations of the financial companies.
"Production and Operations Management" - Everett E. Adam, Jr. & Ronald J. Ebert -4th Edition.
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