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Capacity Requirements

Planning
(CRP)
Capacity requirements
planning (CRP)
“A computerized system that
projects the load from a given
Material Requirements Plan (MRP)
onto the capacity of a system and
identifies underloads and overloads.”
-Russell and Taylor*
Uses of CRP
To Know:
• If a construction company can start
new projects in the future.
• If production plant can produce a
spontaneous order.
• If there is enough labor to make up
for increased seasonal sales.
• If the orders that are do Tuesday can
be accomplished with current staff.
Information entered
into CRP
• Planned order releases
• Equipment and labor
routing file
• Open orders file
Planned order releases
•From the MRP.
•Tells when the order
should be started so that it
is completed on time.
Equipment and Labor
Routing File
Requirements of equipment
and labor to complete the
needed orders.
Open Orders File
Contains the information
of the orders started that
need to be completed.
Information Provided by
CRP
Load profile for each
operation in the production
system
Load profile
Makes a comparison of the
work that needs to be
completed and the work in
progress with the systems
capacity.
CRP is company specific
and requires complex
calculations.
For large companies
professional help is needed
in designing their CRP
models because of the
complexity and importance
of accurate information.
Calculating a simple
Load Profile
• Inputs into a simple load profile
are capacity and load.
• *Capacity is the productive
capability of the system.
• *Capacity = (number of
machines or workers)*(number
of shifts)*(utilization)
*(efficiency)
Definitions of Capacity
• Utilization is the percentage of
total time that the worker works
or the machine runs.
• Efficiency refers to how well the
machine or worker performs to a
given standard.
Definition of Load
• *Load is the standard hours of
work (or equivalent units of
production) assigned to a
production facility.
Simple Load Profile
• A simple load profile can be used by
calculating the Load Percent.
• *Load Percent =
(load/capacity)*100%
• Systems with a Load Percent over
100 will not complete assignments
on time without adjustments to the
system.
*Solutions to
Overloaded Conditions
• Eliminate unnecessary requirements.
• Reroute jobs or labor.
• Splitting the job between two
systems.
• Increase normal capacity.
• Subcontract.
• Increase efficiency.
• Push work back to later periods
• Revise the master schedule
Load Percent Example
A local construction company needs each of its houses
cleaned of all construction debris before they can close
with the buyer. They have one dump truck and a part time
worker who works twenty-five hours a week. Because of
the part time status the worker takes no breaks. For every
four hours of work there is one hour to drive the debris to
the landfill to be unloaded. Five percent of the time at the
site is use to prepare the dump truck for travel. For the
month the construction company has 3 houses closing at
the end of the first week, 5 at the end of the second week,
4 at the end of the third week and 6, at the end of the
forth week. What is the load percent at the end of each
week and can the work be accomplished in that week.
Construction Load
Calculations (Capacity)
• No. of hours =25
• Shifts = 1
• Utilization = 4/5 = 80%
• Efficiency = 95%
• Capacity = 25*1*0.8*0.95
= 19 hours
Construction Load
Capacity (Load)
• Load
Week 1 = 3*4 = 12
Week 2 = 5*4 = 20
Week 3 = 4*4 = 16
Weak 4 = 6*4 = 24
Construction Load
Capacity (Load Percent)
• Load Percent
Week 1 = 12/19 = 63%
Can Accomplish
Week 2 = 20/19 = 105%
Cannot Accomplish
Week 3 = 16/19 = 84%
Can Accomplish
Weak 4 = 24/19 = 126%
Cannot Accomplish
Test Exercise of
Load Percent
A cabinet shop produces and installs cabinets into
new houses. The cabinets need to be installed in
the houses the week they required to be installed to
not slow down construction. A crew of two people
each working 40 hours can install a set of cabinets
in 3 hours. They spend about an hour each person
driving to each installation location. Lunch breaks
are not part of the forty hours worked and the
cabinets are delivered by a separate crew. Due to
experience they are a hundred percent efficient. For
the month 10 installations are needed for week one,
7 for week two, 13 for week three, 14 for week four.
What is the load percent for each week and can the
installations be completed.
Capacity Requirements
Planning
• Used to calculate the ability of
the company to meet its orders.
• Best if company specific.
• Load percentage can be used
for simple operations.