7.3 Capacity Analysis

The Industry Demand Analysis indicates the sensor market is growing. The Capacity Analysis will help the Production and Finance Departments anticipate the cost of adding capacity and automation.

Enter the name of your company's product for each segment in the Product Name column of Form 3. You will find this information in the Production Analysis, page 4 of The Capstone Courier for Round 0. The names of your products start with the first letter of your company's name. If you are not yet assigned to a company, use the Andrews Company information.

Next, find each product's First Shift Capacity in the Capacity Next Round column of the Production Analysis. This number (in thousands) indicates the amount of sensors that can be built over the course of a year using a single, eight-hour shift. In Form 3, enter the Capacity Next Round into the column under First Shift Capacity, Company.

Multiply the First Shift Capacity, Company by the number of active companies in your simulation (page 1 of the Courier displays each company name). This indicates the amount of sensors that can be built for the segment by the entire industry using a single shift over the course of a year. Place the result in the First Shift Capacity, Industry column.

Production schedules that exceed the First Shift Capacity require hiring a second shift. Multiply the First Shift Capacity, Company by 2 and place the result in the First & Second Shift, Company column.

Multiply the First Shift Capacity, Industry by 2 and place the result in the First & Second Shift, Industry column.

Copy the value for Automation Next Round from the Production Analysis into the Automation Level column.

Use the formulas below to calculate the Cost to Double Capacity and the Cost to Raise Automation to 10.0.

Cost to Double Capacity = First Shift Capacity x [$6 + ($4 x Automation Level)]

Cost to Increase Automation to 10.0 = First Shift Capacity x [$4 x (10 - Automation Level)]

Form 3: Capacity Analysis