Rough-cut capacity, also known as rough-cut capacity planning or rough-cut capacity analysis, is a high-level capacity planning technique used by businesses to assess their ability to meet demand based on available resources. It provides an approximate estimate of whether the existing capacity is sufficient to meet the projected demand or if adjustments need to be made.
In rough-cut capacity planning, the focus is on the overall capacity of the production system rather than detailed scheduling or specific resource allocations. It involves analyzing the capacity requirements at a more aggregated level, typically at the department or work center level, without considering individual tasks or operations.
The process of rough-cut capacity planning involves the following steps:
- Demand Forecasting: Estimating the future demand for products or services based on historical data, market trends, customer orders, or sales forecasts.
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Bill of Materials (BOM) Analysis: Breaking down the products or services into their components or tasks and determining the resource requirements for each.
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Resource Assessment: Identifying the resources needed to fulfill the demand, such as labor, equipment, facilities, or materials.
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Capacity Comparison: Comparing the projected resource requirements with the available capacity to determine if there is a potential capacity constraint.
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Capacity Adjustments: If a capacity constraint is identified, businesses can explore options to alleviate the constraint, such as adjusting work schedules, outsourcing certain tasks, investing in additional resources, or prioritizing orders.
Rough-cut capacity planning provides a rough estimate and serves as an initial evaluation to identify potential capacity issues. It helps businesses make informed decisions about production capabilities, resource utilization, and the feasibility of meeting customer demand. It can also highlight the need for more detailed capacity planning and scheduling at a later stage.
It’s important to note that rough-cut capacity planning does not provide a detailed, precise capacity plan but rather serves as a starting point for more detailed capacity analysis and planning.