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Foundations of capacity analysis and supply chain design
Journal of Supply Chain Management, Logistics and Procurement,
7
(3),
239-249
(2025)
Abstract
The importance of capacity analysis in the supply chain of any major corporation cannot be overstated. Any systems integrator (whose core competency is assembling the final product) is reliant upon its suppliers to provide good parts on time in order to meet production schedules and satisfy customer demand. This is of particular importance with Lean manufacturing systems and ‘just in time’ delivery systems. It is also of critical importance due to the observed ‘bullwhip’ effect and supply chain disruptions that still occur during the post-COVID-19 era. It is not uncommon to find that more than 80 per cent of the piece parts required for end item fabrication come from the supply chain. In addition, production schedules often follow a steep ramp for emerging technologies. Ensuring that your supply chain has the required amount of ramped capacity is critical to the success of the overall enterprise (inclusive of prime contractor, supplier, sub-tier suppliers). Fundamental concepts will be presented and demonstrated in examples. This paper will discuss supplier capacity analysis not only from a capacity modelling and simulation standpoint, but also some of the intricacies and interactions associated with supply chain design, business case analysis, lean manufacturing principles, supermarket inventories, human capacity considerations, hidden factory effects1 and the realised manufacturing yield impact on supplier capacity.
Keywords: Monte Carlo simulation; process capability; theory of constraints; capacity analysis; industry; hidden factory; discrete event simulation; hours per unit; span; takt; human capacity; strategic inventory; supermarket
The full article is available to subscribers to the journal.
Author's Biography
Christopher L. Colaw Christopher ‘Chris’ Colaw is a Lockheed Martin Fellow with expertise in digital transformation, inspection technology, autonomation and three dimensional (3D) modelling. In this role, he is responsible for a Quality 4.0 and digital transformation portfolio valued at over US$200m in cost savings for Lockheed Martin. Prior to this role, Chris developed and led the global F-35 aircraft programme variation management strategy which resulted in greater than 40 per cent increase in capable key characteristics (CpK >1.33) and demonstrated overall F-35 programme process capability achievement with the U.S. Government Accountability Office (GAO) and F-35 customers. Chris holds an MSc in management, MSc in mechanical engineering and BSc in mechanical engineering, all from Southern Methodist University (SMU). Chris is also a Certified Manager of Quality and Organizational Excellence from the American Society of Quality and serves as the Chairman of the SMU Mechanical Engineering Industrial Advisory Board, and also as Chairman of the University of Texas at El Paso Industrial, Manufacturing, and Systems Engineering (IMSE) Advisory Board.
Jerry Hamilton is a Lockheed Martin Procurement Engineer and a Certified American Society for Quality (ASQ) Six Sigma Master Black Belt. Jerry works with a team of engineers to employ the use of statistical tools/methods to production processes within the supply chain. He has presented at 14 industry conferences and published articles on the topics of Lean, Six Sigma and Design for Six Sigma and has worked in the semiconductor, transportation and aerospace industries. Jerry holds an MSc in industrial engineering from the University of Houston and a BSc in mechanical engineering from New Mexico State University.
Citation
Colaw, Christopher L. and Hamilton, Jerry (2025, February 26). Foundations of capacity analysis and supply chain design. In the Journal of Supply Chain Management, Logistics and Procurement, Volume 7, Issue 3. https://doi.org/10.69554/HMKH5075.
© Henry Stewart
Publications LLP
Publications LLP