Explain how demands translates into capacity management, production Essay

Explain how demands translates into capacity management, production scheduling and materials requirements - Essay Example It drives the detailed material planning and capacity management requirements to fulfill the known or forecasted demand. Demand is the factor that contributes to the planning of the entire production cycle for a particular time of year. The production schedule gives a structure to depict as to how the manufacturing process has to be carried out. It plans out the inventory, capacity and staffing requirements for the company based on the projected demand. Based on demand as one of the inputs production schedule creates an output that is utilized for decision making. These outputs include the amount of products to be produced, the staffing quantities, the cushion required etc. This schedule helps the organizations in synchronizing their operations, in becoming more efficient and improving accuracy of company’s manufacturing. It enables the different departments to plan their course of action accordingly based on the schedule. For instance it allows marketing department to make le gitimate delivery commitments to warehouse and to the customers. Based on this demand the company may decide to utilize its existing capacity fully to meet the requirements. The capacity management is done to effectively make the most of the capacity that exists.