There are many avenues that companies can use to increase theircapacity. Some are more permanent (hard ceiling capacity increases)some are more temporary (soft ceiling capacity increases). Supposethat you are running a company that produces a component for theautomotive industry. Your current capacity is 5,000 units per week.You have calculated that you will need to increase your capacity to7,500 units a week to meet your current demand. You are consideringthe following methods of increasing your capacity. The use ofdedicated and flexible facilities: Your Company has severalpermanent storage facilities and has used temporary storage in thepast. Flexible workforce: Your Company’s workforce generally works8–5 Monday through Friday. You are considering adjusting existingworkforce time structures to meet planned demand. Subcontracting:With the planned demand increasing, perhaps temporarily,subcontracting the additional resources might be an option. Productdesign flexibility: Your Company is considering modifying itsfactory production lines to be better able to handle future demand.Which of these methods would you consider a hard ceiling increase?Explain? Which of these methods would you consider a soft ceilingincrease? Explain? Which of these methods would you recommend foryour company? Identify the advantages and disadvantages of usingyour chosen methodology.
