At an enterprise, the production program is determined based on factors such as: the total demand for the products it produces and the production capacity of the enterprise.
The production capacity of an enterprise (workshop, site) is the potential annual (quarterly, hourly, etc.) volume of output of products, works, services, etc. of the required quantity with a given nomenclature and assortment based on progressive standards for the use of equipment and production space, taking into account the implementation activities on progressive technology, advanced organization of labor and production.
When planning and analyzing the activities of an enterprise, three types of production capacity are distinguished:
1. Future production capacity reflects the expected changes in technology and organization of production, the range of main products included in the long-term plans of the enterprise.
2. Design production capacity represents the possible volume of output of a conventional nomenclature product per unit of time specified during the design or reconstruction of an enterprise, workshop, or site. This volume is fixed, since it is designed for a constant conditional range of products and a constant operating mode. However, over time, as a result of reconstruction and technical re-equipment, the introduction of new technologies, etc., the initial design capacity will change, but will be recorded as a new design capacity.
3. Current design capacity of an enterprise reflects its potential ability to produce during a calendar period the maximum possible quantity of products provided for by the production plan for commercial products of a given range and quality. It is dynamic in nature and changes in accordance with the organizational and technical development of production. Therefore, it is characterized by several indicators:
Power at the beginning of the planned period (input);
Power at the end of the planned period (output);
Average annual power.
Entrance The production capacity of an enterprise is the capacity at the beginning of the planning period. Day off production capacity – capacity at the end of the planning period, which is defined as the algebraic sum of the input capacity in force at the beginning of the year (as of January 1), and the new capacity, both introduced during the year and disposed of in the same year. Average annual production capacity is the capacity that an enterprise has on average per year, taking into account the increase and disposal of existing capacity.
Production capacity is measured in the same units as the production program - pieces, tons, meters, etc.
The production capacity of an enterprise is a variable quantity. It changes over time, i.e. increases or decreases. Many factors influence changes in production capacity. Here are some of them:
structure of fixed production assets, the proportion of their active part;
level of technological advancement in the main production processes;
productivity of technological equipment;
time fund of one machine (unit) - the standard time for processing (manufacturing) a unit of product, hours.
If the workshop plot equipped with different types of equipment, production capacity is determined by the productivity (throughput) of the fleet of leading groups of equipment that characterize the profile of this unit.
The production capacity of an enterprise, workshop, site is a dynamic category, changing during the planning period. These changes are due to the following factors:
wear and tear and, consequently, write-off and discarding of equipment;
commissioning of new equipment to replace worn-out equipment;
equipment upgrades during major overhauls, which may change its performance;
reconstruction and technical re-equipment of the entire enterprise or its individual production divisions, etc.
For the purpose of production planning, it is necessary to monitor and timely clarify the actual capacity of the enterprise. This is done using average annual production capacities: retiring and commissioning.
Average annual retiring production capacity M s. selected, is defined as the sum of retired production capacity M you6 , multiplied by the number of months n i , remaining from the date of disposal until the end of a particular year, divided by 12:
Average annual production capacity input M s.input is defined as the sum of new capacities M n (in comparable units of natural or monetary terms), multiplied by the number of months with their use until the end of the year n i , divided by 12:
Taking into account the noted indicators, in addition to production capacity at the beginning of the year (input capacity M out its increase or decrease during the year is determined in i-th month M out, as well as output power M out , those. capacity at the end of the year:
The uneven change in power throughout the year makes it necessary to determine its average annual value:
The average annual capacity is found by subtracting the average annual retirement capacity available at the beginning of the year and adding the average annual increase in capacity during the year. This indicator is used to justify the production plan.
Based on calculations of production capacity, reporting and planned balances of production capacity are compiled.
When drawing up a balance for the reporting year, the capacity at the beginning of the reporting period is taken according to the nomenclature and product range of the year preceding the reporting year, and the capacity at the end of the year is taken according to the nomenclature and product range of the reporting year. When developing a balance for the planning period, the capacity at the beginning of the period is taken according to the nomenclature and in the range of products of the reporting year, and the capacity at the end of the period (year) - according to the nomenclature and in the range of products of the planning period (year). Production capacity is influenced by a huge number of factors. At the same time, the nature of their influence is different and changes significantly. In relation to specific conditions, an approximate number of production capacity values can be calculated. The problem comes down to determining the optimal value of production capacity by examining the function for extremeness. For this, linear programming methods are used.
When considering the factors influencing production capacity, the following feature is revealed in their interrelation: they all determine the working time fund, machine intensity, product labor intensity and equipment utilization when producing products of a certain quality and a certain type. Principal dependence of production capacity M from these factors has the following fundamental form:
Where P - number of product types; IN– working time fund of a production unit of product of the i-th type for one cycle, hours. qi – volume of products of the i-th type produced per unit of time (in one cycle), pcs.; n i – the share of products of the i-th type in the total production output (for one cycle).
Analysis of the above dependence shows that production capacity is significantly influenced by the operating time of production equipment, which depends on the operating mode of the enterprise. The concept of the operating mode of an enterprise includes the number of work shifts, the duration of the working day and work shift.
Depending on the time losses taken into account when calculating production capacity and planning, equipment operating time funds are distinguished: calendar, nominal (regime), actual (working) or planned. Calendar fund of equipment operating time F To serves as the basis for calculating other types of equipment use time funds and is defined as the product of the number of days in the current calendar period D To by the number of hours in a day:
Nominal (regime) equipment operating time fund F depends on the number of calendar days D To and the number of working days per year D n , and also on the adopted work shift schedule per day:
Where t – the average amount of equipment work per day on weekdays according to the adopted shift schedule and taking into account the reduction in shift duration on holidays. For enterprises with a continuous production process, the operating time of equipment and production capacity are calculated based on a three- or four-shift operating mode. If the main workshops of the enterprise operate in two shifts (or less than two shifts), the equipment operating time fund and production capacity are calculated based on a two- or three-shift operating mode.
Actual (working, standard) equipment operating time fund F d equal to the difference between the regime (nominal) fund in the current period F R and the amount of time spent on repairs, adjustments, etc. during a year T P , hours:
Time for repairs, adjustments, etc. is taken into account only when these operations are performed during working hours.
Production capacity directly affects the volume of products that an enterprise can produce, i.e. on the production program, and therefore is a powerful strategic tool in the competitive struggle.
What is "production capacity"?
In general, production capacity can be defined as the maximum possible output of products in the corresponding period of time under certain conditions of use of equipment and production resources (space, energy, raw materials, human labor).
In practice, there are several types production capacity:
- design;
- launcher;
- mastered;
- actual;
- planned;
- input and output;
- input and output;
- balance sheet
Productive capacity, as a rule, is measured in the same units in which the production of this product is planned in physical terms (tons, pieces, meters, etc.).
The more fully it is used over time, the more products are produced, the lower its cost, the shorter the time the manufacturer accumulates funds for the reproduction of products and improvement of the production system itself: replacement of equipment and technologies, reconstruction of production and organizational and technical innovations.
What factors influence the amount of production capacity?
Production capacity size determined by the level of production technology, the range and quality of products, as well as the peculiarities of labor organization, the availability of necessary resources, the level of specialization and cooperation, etc. Instability of factors influencing production capacity, gives rise to the multiplicity of this indicator, so they are subject to periodic revision. The leading factor influencing production capacity and determining its value is the equipment.
Productive capacity may change during each planning period. The longer the planned period, the higher the likelihood of such changes. The following main reasons for the change are identified: production capacity:
- installation of new units to replace outdated or damaged ones;
- depreciation of equipment;
- commissioning of new capacities;
- changes in equipment productivity due to intensification of its operating mode or due to changes in the quality of raw materials;
- modernization (replacement of units, blocks, etc.);
- changes in the structure of source materials, composition of raw materials or semi-finished products;
- duration of equipment operation during the planned period, taking into account repairs, maintenance, and technological breaks;
- production specialization;
- equipment operating mode;
- organization of repairs and routine maintenance.
What data do you need to have to calculate production capacity?
For calculation production capacity You will need the following initial data:
- list and its quantity by type;
- modes of equipment use and;
- progressive standards for equipment productivity and labor intensity of products;
- worker qualifications;
- the intended nomenclature and range of products, which directly affect the labor intensity of products for a given composition of equipment.
What are the basic rules for calculating production capacity?
When calculating production capacity You must adhere to the following rules:
- Take into account all available equipment, regardless of its condition: operating or inactive due to a malfunction, being repaired, in reserve or undergoing reconstruction, idle due to lack of raw materials, energy, as well as equipment being installed. Backup equipment intended to replace equipment being repaired should not be taken into account when calculating power.
- When commissioning new capacities, it is envisaged that their operation will begin in the next quarter after commissioning.
- Consider the effective maximum possible operating time of equipment for a given shift schedule.
- Apply advanced technical standards for equipment productivity, product labor intensity, and standards for product yield from raw materials.
- Focus on the most advanced methods of organizing production and comparable measures of equipment operation and power balance.
- When calculating production capacities for the planned period, proceed from the possibility of ensuring their full utilization.
- Provide the necessary reserve capacity to quickly respond to changes in product market demand.
- When calculating power values do not take into account equipment downtime that may be caused by shortages of labor, raw materials, fuel, electricity or organizational problems, as well as loss of time associated with the elimination of defects.
How to calculate production capacity?
As a basis for calculation production capacity, as we have already said, they accept design or passport standards for equipment performance and technically sound time standards. When the established standards are exceeded by workers, the power calculation is made according to the advanced achieved standards, taking into account sustainable achievements.
In the general case, M is defined as the product of the equipment’s rated productivity per unit of time H and the planned (effective) fund of its operating time T ef:
In turn, the effective fund of working time of equipment T ef is defined as the calendar fund of time T cal (year length - 365 days) minus weekends and holidays and the time between shifts T non-working, as well as equipment downtime during scheduled maintenance T ppr and equipment downtime for technological reasons (loading, unloading, cleaning, washing, etc.) T tech:
Defining Specific Values production capacity carried out for each production unit (site, workshop) taking into account the planned activities. Based on the capacity of the leading group of equipment, the production capacity of the site is established; for the leading section - workshop production capacity, at the leading workshop - production capacity of the enterprise. When setting production capacity, you can develop measures to identify bottlenecks in order to achieve the best balance between production capacities of production structures enterprises, incl. using parallel-sequential methods of product processing
How to determine the optimal production capacity?
To determine the most optimal production capacity values You need to justify it. The most common method for economic justification of production capacity is critical point analysis. This method is successfully used in planning production capacity. When using this method, you need to build a graph of the dependence of costs and income on the volume of output based on your production data:
The goal of the analysis is to find the point (in monetary units or units of output) at which costs equal revenue. This point is the critical point (break-even point), from which the profit area lies to the right and the loss area to the left. Critical point analysis is intended to justify capacity by selecting the volume of output that, on the one hand, will be optimal from the point of view of its sale on the market, and, on the other hand, will provide the lowest total costs while achieving the greatest result.
Is it possible for a small enterprise to increase production capacity without significant financial investments?
Of course, many owners of manufacturing enterprises have rather limited financial resources and simply cannot afford to regularly purchase new, more powerful and modern equipment. However, issues of increasing production capacity needs to be addressed and preferably at minimal cost. Therefore, we recommend that you carefully read the following table, in which we have tried to list various ways to increase production capacity, including those that do not require significant financial investments.
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By increasing the available working time fund: |
By reducing the labor intensity of production: |
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1. Increasing the number of installed equipment. 2. Increasing equipment shifts. 3. Improving the organization of equipment repairs. 4. Reduced production cycles. 5. Improved use of production areas and space. 6. Rational planning of work, elimination of bottlenecks in production. 7. Deepening specialization, developing cooperation between divisions and enterprises. |
1. Improving product manufacturing technology. 2. Increasing serial production. 3. Expansion of unification, normalization, standardization of products and their components. 4. Renewal and modernization of equipment. 5. Increasing the level of technological equipment of production. 6. Constant updating and revision of time standards. 7. Rational organization of labor in the workplace. |
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1. The concept of the production capacity of an enterprise. Factors that determine it. Calculation of production capacity. Capacity utilization indicators
2. Classification of enterprises and their place in the external environment
List of sources used
1. The concept of the production capacity of an enterprise. Factors that determine it. Calculation of production capacity. Capacity utilization indicators
Production capacity is the estimated, maximum possible under certain conditions, volume of output by an enterprise (its divisions, equipment) per unit of time. Certain conditions mean: full use of production equipment and space, introduction of new equipment and advanced technology, optimal operating modes, scientific organization of production and labor, application of technically sound standards for the use of machinery and equipment, consumption of raw materials. Its calculation is necessary to justify the production program, identify internal reserves for increasing it and increasing the efficiency of production and its cooperation.
The amount of production capacity is dynamic and varies depending on the production conditions and the nature of the products (work, services performed), the availability of labor and its qualifications, the operating mode of the enterprise and other factors. It is calculated based on the nomenclature and range of products established in the plan or corresponding to actual production, and, as a rule, for a year. In this case, the same units of measurement are used in which production is planned, sometimes in units of measurement of processed raw materials or in conventional units.
Production capacity should be distinguished from the design capacity provided for in the design of the enterprise, the actual value of which may be less or more than the production program, but less than production capacity. At the initial stages of the functioning of enterprises, their production program, as a rule, is less than production capacity for some time (period), when technological processes are mastered, the necessary backlog of work in progress is created, qualified personnel are formulated, cooperative connections are established, etc. Such periods are usually called the period of production development (development of design capacity).
Periods of production mastery are characteristic not only of newly introduced enterprises and their production divisions. In connection with the development of new types of products or processes for their manufacture, they may be periodically repeated in existing ones. At the end of the production development period, its volumes reach the design capacity.
In the future, due to the introduction of scientific and technical progress achievements into production, for example, more progressive technology and advanced equipment, means of mechanization or automation, etc., or vice versa, retirement due to the dilapidation of workshops, units, buildings and structures, production capacity may change (increase or decrease). In this regard, a distinction is made between the average annual introduced and retired, at the end of the year (output) and average annual production capacity.
The average annual introduced M s.vv or retired M s.vyb production capacity is determined as the sum of newly introduced M s.vv or retired M s.vyb capacities, multiplied by the number of full months of their use during a given year T i and divided by 12, i.e.
M svv = ∑ M sv T i /12; M s.select = I M select (12 - T i)/12.
Production capacity at the end of the year (output) M out is defined as the algebraic sum of the input power effective at the beginning of a given year (as of January 1), M in, new capacity introduced during the year, M in, and M out retired this year:
M out = M in + M in - M select.
Average annual production capacity M s.g. is the capacity available to an enterprise, workshop, site on average per year, taking into account the increase in new and disposal of existing capacities. It is defined as the sum of the input power available at the beginning of a given year, M in, the average annual capacity introduced during the year, M s.in, as well as the average annual retired power M s.out (comparable in nomenclature, assortment and units of measurement):
M s.g = M in + M s.in - M s.out = M in + ∑ M in T i /12 - ∑M select (12 - T i)/12.
When determining production capacity, it is recommended to take into account all available production equipment, incl. inactive due to malfunction, repair, modernization, assigned to the enterprise (listed on its balance sheet regardless of location), workshop, site. Reserve equipment that is under conservation is not taken into account in the amount determined by current standards, as well as equipment of auxiliary and service workshops, if it is similar to the equipment used in the main workshops.
One of the important factors in calculating production capacity is technically sound standards for equipment productivity, use of production space, consumption of raw materials, etc. The standards taken into account must provide for the production of the largest amount of products per unit of time (per unit of area, raw materials, etc.). The amount of production capacity of an enterprise also depends on its specialization, the list and quantitative ratio of products to be manufactured. Replacing some of them with others also causes a corresponding change in power.
The operating mode of the enterprise also has a significant impact on the amount of power. In accordance with this, the following funds of time are distinguished: calendar, routine or nominal, real (working). For each piece of equipment, the calendar fund of times is calculated as the product of the number of calendar days in a year (calculation period) by the number of hours per day; the nominal (regime) fund is equal to the calendar fund minus weekends and holidays, taking into account the shortened working day on holidays. In a continuous process, the regime fund is equal to the calendar fund. The actual time fund is the maximum possible for a given operating mode, taking into account the time spent on performing maintenance and repair work on equipment.
At enterprises with a continuous production process, the maximum possible annual time fund is calculated based on a three-shift (and when working in four shifts - four-shift) equipment operating mode and taking into account the established duration of shifts in hours. From the annual fund calculated in this way, the standard time required to perform maintenance, routine and other repairs, weekends and holidays, as well as non-working time on shortened shifts on weekends and holidays is subtracted. In cases where maintenance and repair of equipment is carried out during working hours and this is taken into account in the standards of its productivity, the time spent on their implementation is not deducted from the general time fund.
In enterprises with a seasonal nature of production, the equipment operating time fund is established in accordance with the approved (accepted) operating mode, taking into account the optimal number of shifts (days) of operation of technological workshops or according to the project. For these enterprises, the time for major and other types of repairs that have a significant duration is not recommended to be taken into account.
It should also be borne in mind that when calculating production capacity, equipment downtime associated, for example, with a lack of workers, fuel (energy) and various organizational problems, as well as various losses of time due to manufacturing defects, should not be excluded from the working fund time. Production areas taken into account when calculating production capacity include, for example, areas occupied by production equipment, workbenches, assembly stands, vehicles, workpieces and parts at workplaces, passages between equipment and workplaces (except for main passages), etc. auxiliary areas include the areas of tool shops, repair shops, etc. The total area of the workshop is determined as the sum of the production and auxiliary areas.
The production capacity of the enterprise is determined by the capacity of the leading workshops; workshops - capacity of leading sections (lines); sites - the capacity of the leading groups of equipment. The leading ones are understood as workshops (areas) in which a significant part of the main equipment is concentrated and occupy the largest share in the total labor intensity of product manufacturing or the most complex and labor-intensive operations of technological processes are performed. Thus, at ferrous metallurgy plants such shops include blast furnace, steelmaking, and rolling; in machine tool, mechanical engineering, electrical engineering - mechanical and assembly.
If an enterprise has several main (leading) production workshops (sections, units, installations or groups of equipment) performing individual stages of the technological process, then production capacity is determined by those of them that perform the largest volume of work in natural units of measurement or by labor intensity. If there are several workshops (sites, etc.) with a closed (complete) production cycle producing homogeneous products, it is calculated as the sum of their capacities.
In cases where discrepancies are identified between the capacities of individual workshops, the contingency coefficient is determined - the ratio of the capacity of the leading workshop (section, groups of equipment) to the capacity of other workshops (other production units). In this case, the so-called “bottlenecks” are identified - workshops, sections, etc., the production capacity of which is less than the leading group of equipment (workshop, section), which leads to a violation of the principle of proportionality in the organization of production processes, i.e. to a violation of the same relative throughput of individual divisions of the enterprise.
Effective use of an enterprise's production capacity is a multifaceted system of theoretical and practical solutions. In order to apply any methods, methods and strategies for a particular enterprise, it is necessary to clearly understand what the production capacity of the enterprise is, what its components are and what factors have a decisive influence on it.
Production program and production capacity of the enterprise: what is the difference
The task of any manufacturing enterprise is to produce any market product (service, product). The exact extent to which a given organization can put its offer on the market depends in most cases on its production potential.
Companies collect vast amounts of customer data, which ultimately turns out to be useless. The information is scattered, often outdated or distorted - on this basis it is impossible to make a unique selling proposition to the buyer and predict sales. Our article describes tools for collecting and analyzing information, the use of which:
- optimizes the company's marketing expenses;
- will help build a sales strategy;
- will reduce customer churn due to improved service quality.
The production capacity of an enterprise is an exact expression optimal quantity of goods produced.
The optimal quantity of a product/service produced is the volume of the company’s supply that covers all concluded transactions and obligations for the production of a product/service within a specified time frame, produced at the lowest cost and the highest profitability.
If necessary, the production program can be developed both for the company as a whole and for its separate functional divisions. The periods of the implemented program plan may also be different, but in any case, these periods should not diverge from the terms of already concluded contracts.
The data specified in the production program takes into account all facets of the commodity-market manifestation: the range of the product being manufactured, quantity, quality characteristics of the offer, deadlines, etc.
As a result, the main task of drawing up a production program is to standardize the volume of goods or services produced and sold.
In world economic theory, the volume of goods sold is more often found in the form of the term “sales volume”. This is due to a broader scope of understanding, which includes defining the characteristics of both an enterprise specializing in the production of a material product and a company providing services. Nowadays, there are more and more businesses that combine both.
What are the different types of production capacity of an enterprise?
The production capacity of an enterprise or its individual structural element represents the maximum potential for the production, processing and sale of a product or service with given characteristics for a year or any other period of time under conditions that all the company’s resources are used on the most progressive basis.
When drawing up a production program or plan, as well as when conducting analytical work with the performance indicators of a company or its individual division, three main types of the maximum possible production capacity of an enterprise are identified:
- perspective;
- design;
- active
The prospective type of production capacity of an enterprise is the probable change in production indicators expected in the future.
The design type of production capacity of an enterprise is expressed in the volume of output provided for by the construction project, reconstruction of the enterprise, as well as planned after any technical renovation of production units and changes in labor organization. The design production capacity of the enterprise reflects the coordination of the company to achieve a leading position in a given industry segment of the market.
The current type of production capacity of an enterprise represents the production potential of the facility, which is approved in the production program. This type of potential is dynamic, and trends of change depend on organizational and technical production progress. The current design capacity consists of the following indicators:
- the input level of the enterprise's production capacity (the initial stage of the planned period);
- the output level of the enterprise's production capacity (the final phase of the planned period);
- the average value of the enterprise's production capacity for the year.
The division of the enterprise's production capacity into input, output and average annual capacity is based on the following factors:
- the input level of the enterprise's production capacity is the potential production potential of the beginning of the planned period, which is most often a year;
- the output level of the enterprise's production capacity is the maximum use of reserves in the final part of the planned period, which is equal to the result of adding the input capacity at the beginning of the year and the input capacity introduced/removed during the same 12 months;
- The average annual level of production capacity of an enterprise is the average annual value of the production capacity that the facility has in the conditions of the emergence of new opportunities for the part of the company involved in the production of the product and their abolition.
How to determine the production capacity of an enterprise
An integral part of calculating the planned production capacity of an enterprise is the constant recording of the balance of supply and demand for a product/service. Let’s say that if demand prevails over supply, then planning necessarily reflects a corresponding increase in production potential.
Additional factors influencing the production capacity of an enterprise are the company’s internal resources, such as technological and organizational equipment, the degree of personnel qualifications and strategic progressive management aimed at achieving new economic heights.
The production capacity of an enterprise, as a value, is calculated taking into account the following provisions:
1. The unit of measurement for the production capacity of an enterprise is the same quantitative volume of the product produced as in the approved production program (plan and contract).
2. Calculation of the level of potential capabilities of the manufacturing enterprise occurs at all hierarchical levels of the structure of the production part of the company:
- from the production element of the lowest rank to the link at the beginning of the hierarchy;
- from technologically similar units of production equipment to integrated sites;
- from a small production zone - to a workshop, and then - to a manufacturing enterprise.
3. To calculate the value of the production capacity of an enterprise, you need to know:
- volume of fixed production assets;
- operating procedures for machinery and equipment;
- the amount of time required to produce/process the product and the productivity of technical equipment.
The size of the production capabilities of a lower division affects each larger link in the production structure, from the site to the manufacturing plant. The highest rank is assigned to the division in which the main part of the production and technological processes for the production and processing of the company's product is carried out, the largest human resources are concentrated and in which the fixed assets of the enterprise are centralized.
Economic practice, in addition to estimated calculations of the production capacity of an enterprise, involves the development of a “Balance of Production Capacity”, which reflects:
- quantity of products produced or processed;
- input level of enterprise production capacity;
- design production capacity of the enterprise;
- output level of production capacity of the enterprise;
- average annual production capacity of the enterprise;
- coefficient of realization of production resources.
Factors of the production capacity of the enterprise influencing the value of this value:
- technical equipment of the manufacturer in quantitative terms of machine units;
- technical and economic standards for the operation of machine units;
- compliance of production machines and technologies with current scientific and technological progress;
- temporary funds for the operation of machines and units;
- degree of labor and production coordination;
- used production areas;
- planned volumes of manufactured or processed product, which have a direct impact on the labor intensity of this product with the available technical equipment.
The composition of the technical equipment of the enterprise includes all machine units that are operational, put into operation at the beginning of the year, and those that are planned to be used during the period indicated by the plan. It does not include units of equipment that are in reserve conservation, belong to experimental zones and are used as educational and training installations.
The maximum productivity of technical equipment involved in calculating the production capacity of an enterprise is calculated based on advanced standards for the operation of each machine unit.
The time fund for the operation of technical equipment during a continuous production cycle is defined as the difference between the total calendar time and the hours spent on repair and maintenance.
An important nuance when calculating the production capacity of an enterprise is that idle units do not take part in it, which may be due to the lack of raw materials and material resources, as well as the hours associated with reworking defective products.
How to calculate the production capacity of an enterprise
The total production capacity of each division of the enterprise will be the total production capacity of the enterprise. Calculation within a department is carried out from the lowest level to the highest, for example, from a group of production machines with similar technical characteristics to a production site, from a workshop to a department, from a production department to the entire enterprise.
The calculated production capacity of the leading production unit is the basis for determining the capacity of the unit at the next level. For example, the production capacity of the leading group of machines is the basis for determining the same value for the production site, the power of the leading group is the basis for determining the capacity of the workshop, etc. The leading production unit is the one whose labor intensity is of greatest importance. If a production unit includes several elements of the same type (groups of machines with similar technical characteristics, production workshops, etc.), then its capacity is determined by adding the capacities of all its components.
The principle of calculating the production capacity of both one production element and the entire complex depends on the type of established process. In serial and single production, capacity is calculated from the throughput of machine units and their groups to the capacity of the production unit.
The production capacity of an enterprise is determined not only at the level of the leading units of the plant, but also by its other elements. This is necessary to do in order to timely identify the so-called “bottlenecks”, i.e. groups of machines, sections, workshops, whose throughput does not meet the power requirements of the leading element, based on the indicators of which the total production capacity of the enterprise is determined.
After calculating the production capacity of the leading units of the plant, preliminary load balancing is carried out (bringing the degree of operation of machines in groups to a value that takes into account the optimization of the work of bottlenecks), and only after that they are summed up to obtain the value of the total production capacity of the enterprise.
Indicators of production capacity must be in the same natural or conditionally natural units of measurement in which the production program is planned.
The value of the level of production capacity is differentiated into input, output and average annual. The level of input production capacity is an indicator of capacity at the beginning of the planning period, output - at its end date.
Production output level (MW)- an indicator that depends on the work specified in the plan for the production re-equipment of the enterprise, modernization of the machine fleet, construction or repair of production facilities, etc. This indicator is calculated according to the formula Mv = M1+Mr+Mm-Ml, Where:
- M1 – power value at the beginning of the planning period (input power);
- Мр – the value of the power introduced into the production complex to carry out planned repair, construction, and modernization work;
- Mm is the power value that production units acquired as a result of the implemented transformations;
- Ml – the value of power removed from the production process (for example, the power of obsolete equipment).
Average annual production capacity level (Ms)– the initial indicator, which is the average value of the capacity of a production unit for 12 months, taking into account the capacities introduced and removed from the production process. The same indicator, determined for the entire enterprise, depends on the average annual production capacity of the main division of the plant.
The production capacity of an individual structural unit of production is influenced by various factors: the number of machine units, their technical characteristics, operating time, and their throughput.
The calculation of the level of average annual production capacity is carried out according to the formula Ms = Os FvNp, Where:
- Os – average annual number of machine units with similar technical characteristics;
- Fv – the total volume of the temporary fund of technical units of the enterprise;
- Np is the hourly productivity rate of one machine unit.
Average annual number of machine units with similar technical characteristics is determined by the formula Os = O1 + OvP1/12 – OvP2/12, Where:
- О1 – number of machine units at the beginning of the planning period;
- Ov – the number of machine units introduced into the production complex during the planning period;
- Ol – number of machine units discontinued during the planning period;
- P1 and P2 – the number of full months until the end of the planning period after the installation/removal of equipment.
How should the production capacity of an enterprise be planned?
Without planning the use and increasing the production capacity of the enterprise, all business achievements of the production complex will be short-term in nature. Based on practical observations, we can say for sure that excess production capacity has a more positive effect on production than its deficit.
Therefore, when planning the use and expansion of production capacity, managers should ask questions of the following nature: “Will my production have one global production capacity or will it be a collection of several small resources?”, “Will capacity expansion occur as needed or as part of the planned strategy?” etc. To get answers to such questions, the manager must develop a plan for the development of production and its capacities, and the analysis of its effectiveness must be systematic.
When choosing production capacity, there are three factors to consider.
1. What reserve of production capacity is needed?
The average value of the involvement of production facilities in the production process should not be equal to 100%. If the capacity indicator is close to this figure, this signals that either production capacity requires an early increase, or it is necessary to reduce the volume of output. Those. The plant should always have some reserve of production capacity, which must be reserved in case of an unplanned surge in demand or failure of any production units. A plant's production capacity margin is the difference between average utilization (or actual production capacity) and 100%.
In practice, it makes sense to have a large reserve of production capacity when:
- the demand for manufactured products is highly dynamic;
- the volume of future demand is unknown and resources are not flexible enough;
- demand changes in the ratio of different types of products;
- there is no clear delivery schedule.
An excessively large reserve of production capacity is often the result of increasing the production capacity of an enterprise in minimal quantities. Therefore, it is better for a company to increase its capacity in large stages at once.
A small amount of reserves of production capacity is justified: a small amount of financial resource that is not involved in the production cycle is “frozen,” and a decrease in efficiency is also visible due to a failure in the supply of raw materials or a decline in the labor activity of workers (these disadvantages often remain invisible with a large reserve of production capacity).
2. When and how much to expand production capacity
The question of the volume of expansion of the enterprise's production capacity is not the only one. It is equally important to determine in a timely manner when the plant needs to introduce additional capacity. How much and when to increase a company's production resources is decided by one of two strategies: expansionist or wait-and-see strategy.
The first technique is the expansion of the production capacity of the enterprise in large volumes over long periods of time; the volume increases in advance, without waiting for power reserves to run out.
The second, on the contrary, implies the introduction of additional resources often and in small volumes (“wait-and-see” in translation - “wait and see”, “we’ll wait and see”); additional resources are introduced only when the established critical level of inventory is reached.
The time and size of the increase should be directly proportional to each other. Thus, if, against the backdrop of increasing demand, the intervals between the introduction of additional capacity increase, then the volume of increase should also increase. The expansionary method of increasing production capacity stays ahead of changes in demand, minimizing the possible loss of profit from lack of capacity.
The wait-and-see method follows changes in demand, while the lack of resources is compensated for by any urgent measures: overtime hours, hiring temporary labor, renting additional premises, etc.
The business manager can use one of these methods or use any intermediate version, for example, introducing additional capacity in shorter periods of time than with the expansionist method, but following demand, as with wait-and-see.
An option that combines two methods equally is called follow-the-leader (“follow the leader”), i.e. focus on the time and volume of capacity increase of leading companies in their market sector. Obviously, with the middle option there is no question of increasing competitiveness.
3. How does the expansion of production capacity relate to other aspects of the enterprise’s activities?
The introduction of additional production capacity should be part of a unified development strategy for the entire enterprise. Changes in the flexibility of resources and their location must be commensurate with the reserve of production capacity resulting from these changes, because all three of these aspects are factors that influence the increase or decrease of a company's risks. The reserve of production capacity is also interconnected with other aspects of the company’s activities, which include:
- competitive advantages. For example, when a competitive advantage such as high delivery speed emerges, it is necessary to ensure that the reserve of production capacity corresponds to changes in demand, especially if warehouse costs are not economically justified;
- quality management. With higher quality products, it is advisable to reduce the production capacity reserve of the enterprise, because here losses associated with the release of defects and other types of reduction in the final volume of production are minimized;
- capital intensity. Investments in high-tech equipment. To compensate for the balance of finances “frozen” in the production cycle, it is advisable to reduce the reserve of production capacity;
- flexibility of resources. As workforce flexibility decreases, the likelihood of equipment overload increases. Production can be balanced by increasing the production capacity reserve;
- equipment. Unreliability in equipment requires an increase in reserve production capacity, especially during periods of sharp increases in demand for manufactured products;
- planning. A stable business environment increases the level of product/service guarantee, so it is appropriate to have a small reserve of production capacity;
- location. Geographic expansion of production requires an increase in the stock of production capacity in a new location with a probable decrease in it in the old one.
So, any changes in production capacity must be combined with planning of other company functionality. Financial analysis and assessment of human resources should form the basis of both planning changes in production capacity and management of the company as a whole, which, in turn, should be carried out against the backdrop of knowledge of the characteristics of a given market segment and forecasting changes in supply and demand.
Experts advise planning the expansion of the enterprise’s production capacity according to the following step-by-step scheme:
Stage 1. Assess the required production capacity
To analyze long-term capacity requirements, it is necessary to calculate likely changes in demand, productivity, competition, and the time over which technological changes will take place. To compare with the value of production capacity, the value of demand must have a numerical expression.
Stage 2. Calculate the difference between the required and available production capacity
The exact measure of productive capacity is not easy to determine when the expansion process involves several types of resources. Thus, the introduction of additional capacity within one operation can increase the value of the total production capacity, or the expansion of the total capacity is impossible without adjusting the capacity of bottlenecks (if any).
Stage 3. We draw up options for plans to close the gap
Potential gaps in production capacity must be taken into account in alternative plans to address them. Company managers can choose “plan 0”, in which no active actions are taken, passing by orders that do not fit into the volume of available production capacity. Another way is to use expansionist and wait-and-see methods, choosing the timing and volume of increasing the production capacity of the enterprise yourself.
Stage 4. Qualitatively and quantitatively evaluate each alternative and make a final decision
In the course of a qualitative assessment, management analyzes likely changes in the enterprise's economic activities that are not affected by the financial analysis, which will be the result of changes in the volume of production capacity. Aspects such as future demand dynamics, competitive responses, changes in production process technology or final cost should be weighed against future expansions of production capacity only through sound judgment and experience.
Quantitative aspects are also compared with future prospects for changes in enterprise capacity. The most negative of them is the one where demand is of minimal importance, and competition is of greater importance. When making decisions, management must take into account both the most pessimistic outcomes and the most favorable ways of developing the situation.
Financial flows also have a quantitative assessment: from “plan 0” to other options for the chosen strategy. At this stage, only the difference between the company’s income and expenses that is relevant to the project under consideration is assessed.
How to analyze the production capacity of an enterprise
In order to develop a further strategy for the development of production, to optimize the operation of existing technical equipment, it is necessary to carefully study the work of production in the past period.
The production capacity of the enterprise is analyzed based on an assessment of the following characteristics.
Capital productivity and the reasons influencing it
Capital productivity, or the turnover ratio of fixed assets, characterizes the degree of efficiency in the use of basic production equipment, the quality and quantity of which are decisive for the formation of the total production capacity of the enterprise. Capital productivity is the amount of output that falls on 1 or 1000 rubles of the monetary value of production fixed assets.
The value of capital productivity is influenced by the practical use of technical equipment, production area, as well as the dynamics of the cost of machine units and product units. Another characteristic of production that affects the value of capital productivity is the composition of fixed assets of production, defined as the sum of the value of technical equipment, energy and transport resources, the price of real estate involved in production and other parts of the system of fixed assets.
The next step in analyzing the use of the enterprise's production capacity is to evaluate the production indicators affecting it.
Assessment of the structure of technological and technical equipment
When determining the relationship between the quality of a technical process and the level of production power consumption, it becomes clear which part of the advanced methods for producing a product is used at a given plant. Those. the structure of the equipment used is analyzed and the percentage of production equipment that affects the increase in the quality of the production cycle is determined. One of the evaluating factors for the progressiveness of machinery is the time required to install this equipment and obtain the first batch of products.
Study of the process of using machines and units
In parallel with the assessment of the composite nature of production equipment, the degree of its operation is monitored. This takes into account the ratio of all available equipment and that which is directly involved in the production cycle. The numerical discrepancy between these two indicators, multiplied by the value of the average product output, represents the production potential, i.e. the quantity of manufactured products that a given enterprise can provide provided that the full range of equipment is introduced into the work process.
Assessment of the production capacity of an enterprise in the field of efficient operation of equipment occurs by determining the proportion of idle machine units.
The number of unused machine hours is determined from current job reports. Lost time is analyzed by comparison with the planned volume of machine hours and reports of similar enterprises. If you subtract the actually used time from the planned time and multiply the result by the average unit productivity per hour, you get the potential that this enterprise has in terms of eliminating downtime that was not taken into account by the plan.
Assessment of the extensiveness of equipment operation
For this study, we first determine the amount of product produced that is the result of the actual operation of this unit per hour. For multifunctional machines, the average output value for different production segments is taken.
The assessment of the extensive use of technical equipment is carried out by determining the values: the number of products produced per machine-unit, per machine-hour, per 1 sq.m of production area and per monetary unit of the cost of the fixed assets of production.
Assessing the efficiency of using production space
In production areas with predominantly manual labor, the utility of the area occupied in the production process is determined. Public areas and those premises that do not relate to direct production are not taken into account. The amount of usable space multiplied by the duration of the shift determines the potential for efficient use of the production capacity of a given area. The resulting figure is measured in square meters-hours.
The ratio of practical workload to those metro hours that are reserved determines the coefficient of utilization of production space.
When analyzing this factor, the following characteristics are also determined: the number of products produced per 1 square meter of production area, the specific indicator of the area involved in the production process in the total territory of the plant.
Determination of reserve potential in conditions of effective use of the enterprise’s production capacity
Assessing the level of impact of the use of fixed assets on the quantity of output is the basis for analyzing the use of the enterprise's production capacity. In this case, the deviation of practical characteristics from the planned ones or from one-time outstanding maximum indicators is determined. The resulting differences when taking into account the output of a unit of equipment or a site take part in the calculation of the reserve potential of production.
When assessing the performance of technical equipment and drawing up an appropriate plan in production with multifunctional units, all equipment is grouped depending on various technical characteristics. The resulting groups are divided into subgroups if necessary. The composition of one group is determined by machines with similar performance indicators and those that are interchangeable during the same production cycle. After such differentiation of equipment, one group acts as a unit that participates in the analysis of workload and determination of potential reserve. The result of the work carried out is the development of measures aimed at increasing the efficiency of using the vehicle fleet.
If narrowly targeted units with rare characteristics are involved in the production process, each of them is differentiated as a separate subgroup for analysis and planning of their operation. On production lines, the entire line acts as a separate subgroup.
The impact of the main series of reasons on the use of the enterprise's production capacity is analyzed by simple formulas. There are also those factors whose influence can be calculated by determining correlation dependencies.
How is it possible to increase the production capacity of an enterprise?
To increase the efficiency of using production equipment, the following measures can be taken:
- reduction of basic time expenditure per product unit;
- reduction of additional time expenditure;
- reduction of the temporary stock of equipment in use;
- reduction of time spent on unjustified and unproductive workload.
The basis for carrying out these activities is the improvement of the main fleet of machines, progressive changes in equipment and technology, increased coordination and labor discipline.
Increasing the efficiency of use of production space occurs through the abolition of auxiliary and service areas, the use of lifting and transport equipment, and the introduction of progressive product manufacturing techniques that increase the value of product output per unit of area.
1. Reducing the main time spent on one product unit.
Progressive changes in equipment and technology, the use of flexible integrated processes, coordination and specification of labor, and increased qualifications of personnel have a direct impact on the production capacity of the enterprise and the level of its practical application with reduced time spent on one unit of product.
The most significant is the introduction of technological innovations that reduce the stages of the production cycle. Examples of methods that intensify production are increasing the power or speed of units, increasing pressure and temperature standards, using chemical catalysts, etc.
An important factor in reducing the work of machine units is the quality of production raw materials.
2. Reducing additional time spent on one product unit.
Additional time spent in production is eliminated by using the following measures: the use of more productive equipment, tools and technological resources, the use of automation at the stages of the production cycle.
Based on the practical experience of many manufacturing companies, the production capacity of the enterprise is necessarily analyzed, the definition and study of the structure of which has shown that flow production is the most effective form of organizing the technological process. The location of units and workplaces along the production process, the rhythm and continuity of main and auxiliary operations, the use of special equipment for transferring products between cycle operations - all this significantly reduces additional time spent (waiting for tools to be supplied, downtime, hitches, etc.)
What is the production capacity of the enterprise? This concept includes the volume of the maximum probable output. In this case, certain conditions must be observed. Firstly, all released products must be of high quality. In addition, the equipment must be fully utilized in the production process.
The calculation is made taking into account the implemented advanced technology and modern equipment, at the highest level in the organization of all links, as well as under other optimal conditions.
Types of indicators
The production capacity of an enterprise is measured in the same units as production volume. These include the value expression of manufactured products, conditionally natural and natural units. During the operation of the enterprise, the value of the production capacity indicator undergoes certain changes. This occurs due to the introduction of new equipment and the write-off of already worn-out equipment. Such actions lead to changes in the quantitative values of the volume of goods produced by the enterprise. There are only 3 types of power. All of them are classified as production. First of all, this is the input power. It is calculated at the beginning of the period for which planning is carried out. There is power output. It is calculated at the end of the planned period. And finally, the third type is the annual average.
Calculation of production capacity
To properly plan the work of an enterprise, it is imperative to determine the volume of products that will be produced by it. The production capacity of the enterprise is directly dependent on the capacities of the leading divisions. These include those areas or workshops that are entrusted with the task of performing the most massive, responsible and labor-intensive work. If we take the engineering industry, the leading divisions of its enterprises are assembly and mechanical shops. For metallurgy, these are open-hearth, blast furnaces and smelting furnaces.
Conditions for calculation
When determining the volume of finished products, certain points must be taken into account:
1. The production capacity of an enterprise is calculated from bottom to top. This chain moves from homogeneous equipment to a specific production site. After grouping all the information, the calculation covers each workshop and is completed by the entire enterprise.
2. When calculating the production capacity of each department, the standards for piece time, as well as output, are taken into account. At the same time, special formulas take into account the entire range of products.
3. The volume of finished products is determined at the target date. This is necessary due to the variability of the indicator when decommissioning or commissioning equipment, and is also due to the need to apply new process conditions, etc.
4. Calculations for assembly shops must be made not according to the equipment they have, but according to their production area.
5. The preliminary determination of the volume of output should not take into account the loss of working time that is caused by certain shortcomings in the technical and organizational support of the production process. Marriage is also not taken into account. Only those inevitable losses of time that are within the approved standard are subject to accounting.
Special cases
In practice, situations arise when the production capacity of individual divisions differs from the capacity of the leading unit. In this case, discrepancies can be both greater and lesser. In this situation, there are divisions of the enterprise that are not synchronized in terms of power.
In the event that calculations indicate that a given indicator of one of the divisions exceeds the same indicator of the leading link, certain measures should be taken immediately. The administration of the enterprise must either utilize the available excess capacity to the maximum, or agree that this unit will have backup equipment. If the calculations made indicate a higher production capacity of the main leading link, then the problem of the so-called bottleneck arises. Then the manager must decide to expand the problem division. For this purpose, additional jobs may be introduced, the time of use of equipment may be increased, or one-time orders may be outsourced.
Calculation sequence
Determining the volume of output using the equipment available at the enterprise goes through the following stages:
The production capacity indicator is calculated for the leading group of machines and equipment operating at the leading site;
- the calculated capacity of the enterprise is analyzed to identify bottlenecks of the entire production complex;
- certain management decisions are made to eliminate problem areas;
Newly emerging bottlenecks are identified;
- the production capacity is calculated;
- coefficients are established that characterize the use of all production capacity, both for individual divisions and for the enterprise as a whole.
Indicators of production capacity
The maximum probable volume of finished products is calculated under the condition of the best organization of labor and under ideal conditions for the technological process. In reality, this is impossible to achieve. That is why the actual volume of output is always lower than that corresponding to the calculated indicator. To adjust planning, it becomes necessary to determine the level of utilization of the enterprise's capacity. In quantitative terms, this value is equal to the ratio of actual annual output to the indicator of production volume determined for the same period. The level obtained in the calculation, which shows the percentage of use of the entire production capacity, directly depends on internal and external factors that manifest themselves in relation to the technological process. The first of them include those that are directly related to the production of products (equipment modernization, operating mode, etc.). And external factors are the state of the market, the competitiveness of goods, demand for them, etc.
Conditions for increasing production volume
In market conditions, the most important factor in increasing the efficiency of an enterprise is increasing the use of production capacity. However, this only makes sense when the entire volume of goods produced will be in consumer demand. Otherwise, the enterprise will become overstocked with products.
If the market is developed well enough and the demand for products is high, then production capacity can be used in the amount of eighty to eighty-five percent. If the necessary conditions are not met, then the amount of equipment involvement in the technological process can drop to a factor of 0.3.
Parameter indicating the possibility of growth
The production potential of an enterprise is an indicator characterizing the ability of an enterprise to produce goods. Some economists consider this concept to be similar to productive capacity. However, there is no consensus on this issue. In some works, production potential is considered as a certain set of enterprise resources without taking into account technological processes. In another interpretation, this concept takes into account only those resources, the use of which contributes to the reproduction of material wealth.
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