Beck Manufacturing and Plan Capacity - Assignment Example

Therefore, for the expansion of the capacity, this is the centre where Beck Company should be putting its focus. By definition, a bottleneck is an operation with the least effective capacity of a given operation in any machine centre and hence thwarts the systems output. Therefore, based on the individual capacity of the machine centers, boring operation centre is a bottleneck that restricts the output to 11.25 pieces per hour, while the operation with the maximum highest capacity is grinding centre with 78.

75 pieces per hour. This means that for boring to reach this capacity, it will require 67.50 extra capacity. According to Vonderembse, & White, (2013), meaningful expansion of the system’s capacity can only take place when the bottleneck is expanded. Initially, increasing capacity of the boring operation without expanding that of drilling, milling and grinding would ultimately expand the capacity of the system. However, when the boring operating capacity reaches 78.75 pieces per hour, drilling, milling and grinding operations must also be increased at the same time further expand the capacity of the system.

In sizing capacity cushions, an average usage rate should not reach a 100 percent and if this happens, that shows a sign to expand the capacity or reduce order acceptance to prevent declining the productivity of the system. Vonderembse & White (2013) defines capacity cushion as the amount of reserve capacity that a business organization upholds to take care of any unexpected boom in demand or impermanent losses of production capacity; On the other hand, Mr. Beck can apply timing and Sizing Expansion strategy and in this strategy, he ought to understand when to expand the capacity and by how much.

There are two tremendous strategies, which are the expansionist strategy that entails huge, infrequent jumps in capacity, and that of wait-and-see strategy, which entails lesser, more frequent