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featureed image Published 2020-06-23, by Kellie Auman

Smart Manufacturing Processes: Balancing Capacity Vs. Demand

One of the eternal struggles in manufacturing is trying to balance your factories’ capacity with the demand generated by your sales team. In a perfect world, these would be 1:1, but of course, nothing’s perfect. However, that doesn’t mean you shouldn’t try.

Unfortunately, too often we hear cases where these numbers are completely off-balance. Maybe a sales team is far too good at drumming up sales, to the point that shipments are delayed. Maybe the manufacturing side has too many ups and downs in production numbers, making precise estimates difficult. Maybe the two teams have little to no communication, and end up working at cross-purposes too often.

Whatever the issue standing in the way of bringing capacity and demand into balance, smart investments into Industry 4.0 technologies can help get things under control.

Balancing Capacity And Demand With Smart Technology Upgrades

How much variation is there in how many units you can produce in a day? If there’s too much up-and-down in production, it can cause huge problems for sales and their forecasts. To reliably generate demand, they need relatively reliable numbers for how many units will be produced in a given period

This is one of the scenarios where Industry 4.0 upgrades can do the most good. Uneven production is usually caused by either too many products that fail QC, or bottlenecks in the production pipeline that cause downtime. Both of these can often be remedied with an investment into smart monitors throughout the production line, backed by AI systems watching for problems before they happen.

More data about your production pipeline means having better control over it.

Once you have that sort of data, it then becomes far easier to get sales and manufacturing on the same page. Sales needs hard targets to shoot for, and they should never be allowed to simply sell as much as they can manage – otherwise, you can easily end up with a backlog, and a reputation for being slow to deliver.

Having open lines of communication is key here. Too many manufacturers, particularly those still tied to 20th Century style techniques of silo’ing and isolating each department, don’t have enough ways for sales and manufacturing to keep in touch with each other. Sales should always be aware of manufacturer's capacity, and manufacturing should have plenty of information about sales’ activities. In particular, if a major new deal is under negotiation, manufacturing should have as much warning as possible that demand will increase. Don’t wait until the deal is signed – keep them in the loop so that they have as much warning as possible before any major new orders hit.

Industry 4.0 processes aren’t simply about technology – they’re about creating integrated collaborative ecosystems within your own organization, and across your partner ecosystem. Data isn’t an end, it’s an enabler. Collect the data, utilize it to improve your processes, then make it available so that all departments can collaborate and excel.

Here's another resource that may be of interest to you:

Assessing Dealer Capacity and Performance