Capacity Planning:

                Strategic Management is very important for every business process because it’s enhanced the business efficiency, its capacity and helps the management to reduce the business costs and business processing costs. Here we discuss the Capacity Planning for a business and explain it widely how that helps the business in the long and short run?

Strategic management has many elements to achieve its objectives and goals. Capacity Planning is one of them and that helps the strategic management in the designing of the organization capital budget. Here we can say that the strategic management helps the business to use its element Capacity Planning and make or design a very effective and efficient capital budget for a business.

“Capacity Planning is a value able process which helps a business organization to use its available resources and investment and make the complete business process costing efficiently and effectively to achieve the business objectives and goals. That shows us the management of cost and efforts to use the business resources in the business production process is known as capacity planning.”

There are some key points that show us the how to effectively do the capacity planning for cost and production efficiency:

·         Management needs optimizing capital decisions for short run investment and more flexibility in the business process.

·         Customers are the king of the market they need more attention.

·         Capacity planning helps the management to minimize the requirements for future investment.

·         Successful Capacity planning needs the direct relationship matching in business resources and market future trends and opportunities.

·         Market strategy its trends analysis its minimum demand and supply gaps are the key requirements.

·         Production process efficiency and production waste eliminations are the key factors which support for effective capacity cost planning.

·         Production process real information about cost and resources helps the complete business costing process.

·         Usage measurement and business cycles identification and impacts over business process must be real for effective capacity costing planning.

·         Complete details about opportunity cost and the change efforts in production and other process are very necessary for all the economic activity efforts.

·         Effective links and common relationship needs for all the business process, or the business needs the effective communication process.

The Capacity level influence all the business processes like the production, costing, investing, pricing, packaging, financial reporting that all are necessary for business capacity. The level of the company capacity makes influence over its profit margin reporting and over its product sales price that also helps the business in the long run and also in the short run periods to achieve its capital budgeting objectives.