Capacity Management

Capacity Management: Explanation and its Benefits

Capacity management is one of the most important topics being used in the information technology sector. It is considered as a practice that helps in right-sizing the IT resources in the business to help meet present and future needs. It is a practice that is considered to be proactive instead of being reactive. This is because the companies doing well in capacity management gain from their operations by minimizing the need for their IT resources and fulfil their service needs with the limited IT resources. It has been the primary goal of most of the companies and business in today’s world facing high competitive pressure. It is also a tool that helps in managing the cost of the business by limiting their future and present IT needs in the most cost-effective manner.

One of the most common meaning and analysis of capacity management framework is made in the ITIL framework. This framework helps in explaining the process of capacity management by comprising three sub-business processes such as business capacity management, service capacity management and component capacity management. It is seen that with a change in the information technology services and different types of functionality evolves then the memory and storage in the central processing unit, as well as virtual service, also changes to some extent. Thus, if such changes are studied by the business from before then it becomes beneficial for the business to propose their capacity planning for the IT services.

It also forms a close link with the financial management areas over time in the business. Further, there are other areas in which capacity management works effectively such as supporting constant change in technology, identifying the opportunities available for the improvement in the business, conducting planning process for effective and accurate resource requirement. Thus, the term capacity building is used to understand the scalable solutions that the practice offers to various kinds of capacity bottlenecks in the business. Thus it has been the most important solution to all the IT practices involved in the business.

Further, in a business, it is also related to other resources along with information technology. It ensures that the right amount of resources are available where needed at a specific time and place and at the right price. Thus, the resources here can be human resource, financial resource and others along with IT resource. The major aim of capacity management is to ensure that there is enough amount of capacity in the business to conduct various activities. However, there is another meaning as well that is to ensure that there is not too much capacity of resources a business has that might lead to wastage and excessive cost to the business. Thus, its needs are to be maintained in all areas of business and not only IT. This means it should include both business operational as well as technical need.

The notion of capacity management takes into consideration that both current and future needs should be anticipated in a planned manner to avoid getting any capacity issue. The anticipated needs should be documented carefully, analyzed, set priorities and then convert it into a set of demands for the IT department. However, the capacity management cannot be retrofit which means that if there is poor performance due to poor capacity management then it is too late to improve it. Good capacity management decision thus needs proper planning and a clear analysis of information of that there is no future issues or capacity shortage. This is because efficient and proper capacity management helps in the creation of company success and minimize the rate of issues that takes place. My Assignment Help will now explain to you the benefits of Capacity Management.

Benefits of Capacity Management

Effective capacity management is seen to deliver various kinds of benefits to the organization both in the short term and in the long term. There are both tactical benefits as well as efficiency improvements in the business. The capacity management helps in creating a link between the ever-changing environment of the business and the ability that the IT department holds to stay flexible and satisfy the need of the organization at a reasonable cost. The benefit of managing capacity in a timely manner helps the business to avoid any kind of shortage and inabilities to arise that may prove to be crucial for business projects. There are some specific and important benefits of Capacity Management such as:

  • Capacity management helps in reducing the panic buying and thus a business needs a fact-based justification for taking up any capacity decisions.
  • Managing the right capacity at the right time helps in reducing the risks to the current services of the business, especially when the business is introducing new services and products to meet new demands.
  • Capacity management helps the business to better management and use their resources and this, in turn, help them earn a better return on their investments.
  • One of the most important benefits of capacity management is that reduces the chance of wastage due to overcapacity and redeployment of the resources in other departments so that the business can improve their other services and reduce unreasonable cost.
  • The chances of disruptions due to insufficient capacity during a project us reduced when the firm plan effective capacity management.
  • Further, it is seen that fault diagnosis is done in a better manner for capacity-related issue when effective capacity management is implemented.
  • The capacity management process helps in developing a capacity manager role and help in making him/her the focal point of the issues that come up related to capacity management.
  • The firms are able to be proactive in their work that is to put the capacity management in the agenda of senior management.
  • The capacity plan should be created in a timely manner and ensure that it is updated periodically so that the change in the organization does not affect the capacity.
  • One of the important things that need to be made in relation to capacity management is that it helps in creating a capacity database that helps in collecting and measure performance requirements. The information from this database can be used to build the capacity model that is crucial for the success of the business.

This shows that capacity management has various types of benefits for the organization and is responsible for the success of the business. This is because it acts as a great source to manage information technology operations that are implemented as a primary resource in projects. Assignment Help UK will now explain to you about the importance of capacity management.

Importance of Capacity Management

Capacity management also holds various types of importance in the organization by the role it holds. The notion of capacity management in the organization are measured based on four business criteria such as quality, cost, speed and flexibility. Further, it is also important in sharpening the operational planning of the business and controlling internal issues. These areas act crucial for organization success and thus needs to be related to capacity management processes. By holding efficient and sufficient capacity in the business it becomes easy for the organization to manage the quality of the project by exploiting the right amount of capacity required.

Moreover, the cost is controlled with the help of the capacity management process and thus forms an important part of the business, as the organization is able to cut out the excess resources they have. Managing the capacity in the organization strategically also helps them to administer the total assets they have efficiently. They are able to keep a close check on the areas their capacity is being used and 2the areas that are still lacking capacity. Thus, by closely monitoring the capacity of the business and the performance of that capacity a manager is able to detect the issue they are facing regarding ability before the problem becomes too difficult to handle. However, in some areas, it becomes difficult to handle the said capacity issue because some of the problems cannot be solved by just increasing the issue.

In recent time many organization has surfaced a resource-based view in place of capacity management and its related concepts and theories. The theories of resource base also analyze the resources of the firms and ensure that the resources that the business is owning help in providing a sustainable competitive advantage. This theory of resource base is an added theory of capacity management and does not prove to be as efficient as the capacity management theory. Further, it is seen that capacity management is one of the most important things that the business take up because it helps them in planning and indulging in strategic decisions.

This theory has helped in introducing many new concepts such as obtaining resources through outsourcing, capacity utilization, meeting deadlines and optimizing the revenue of the organization. The other areas in which capacity management shows its importance is process innovation, acquisition of resources, expansion of internal resources and re-aligning the structure of the organization in an effective manner. This shows that the concept of capacity management is crucial for the organization from various operational and other aspects from planning, production to distribution in the market.

capacity building
capacity building

Capacity Planning and Control

Capacity management also includes capacity planning and control that takes care of operational issues. The capacity planning and control acts as an issue in every organization if not conducted properly and effectively over time. Moreover, if these activities can be performed effectively then it affects the efficiency and effectiveness of the organizational operations. This is because operations in an organization are limited to the capacity they have such as resources, information technology and others. This makes it important for the organization to take up planning for capacity management and set up organizational goals and objectives such as the capacity needed for supply chains. Thus this activity is considered to be the most important activity for businesses all around the world. The process of capacity planning, however, differs from one industry to others depending on their needs and long term goals. There are certain factors that are common to every industry and initiate planning, however, there are some elements that do not apply to every situation. This shows that the process of capacity planning and control is a crucial thing to do and is not easy to develop it.

Capacity planning and control are concerned with the fact that there is a balance between the demand put on the operation and the ability of the organization or capacity to satisfy those demand. Planning is an important process in CM because it helps in understanding future capacity needs according to the goals of the business. Moreover, it is seen that when capacity is high and the demand or need is lower than the cost of paying out to the machinery and staffs increases over time. At that time the cost is passed out of the customers due to excess capacity. This makes it more necessary and important to have proper capacity planning and control in place.

Further, it is seen that capacity planning and control is a task of setting up a proper plan for the capacity that is required in the operational process. However, the system of planning the capacity cannot be always accurate with zero errors. This is because operations managers of every organization face unforeseen and uncertain demand over time that can never be planned. In such cases, it is possible for the CM system to form planning in an extended manner that can meet the unforeseen situation along with not creating any excess capacity. This can be done with the help of a capacity control system that helps to manage the existing capacity of the organization in such a way that it helps in meeting the current demands with no shortage or excess. If you want guidance in your assignment related queries of any topic and any subject, our experts from Online Assignment Help is always there for you to give you expert guidance.