Introduction
Capacity planning is a critical component for manufacturers looking to optimize production efficiency and resource utilization. In Microsoft Dynamics 365 Business Central, capacity planning enables manufacturers to manage the workload on the production floor by aligning resources, work centers, and machine centers to meet manufacturing demands effectively.
Business Central's capacity planning functionality is deeply integrated with production orders and scheduling, allowing manufacturers to gain visibility into resource availability, optimize production schedules, and reduce bottlenecks. In this blog, we will explore the fundamentals of capacity planning, including setting up work centers and machine centers, and how this structure enables efficient manufacturing processes.
What is Capacity Planning in Business Central?
Capacity planning in Business Central is the process of estimating the available production capacity and aligning it with manufacturing demands. This process helps manufacturers make informed decisions about when to add more shifts, invest in additional machinery, or optimize scheduling to meet production goals.
In Business Central, capacity planning is driven by four primary components:
- Work Centers: The central points where production activities take place.
- Machine Centers: Sub-units within work centers dedicated to specific tasks.
- Routing: Defines the sequence of operations required to manufacture a product.
- Capacity Variables: Metrics such as time (minutes, hours), efficiency rates, and load distribution.
The concept of work centers and machine centers is central to capacity planning, as it optimizes production by segmenting tasks and assigning them to specific resources. While some manufacturers heavily leverage capacity planning to avoid bottlenecks, others may only view capacity requirements without fully managing them. This largely depends on the complexity of their manufacturing operations.
Setting Up Work Centers and Machine Centers
The setup of work centers and machine centers is the foundational step in capacity planning. In Business Central, a work center represents a collection of resources such as machines or labor units that are grouped to perform a specific function. Machine centers are individual units within these work centers, each assigned to particular tasks.
The setup begins with defining the Unit of Measure—in the demonstration, it is configured as Minutes, which is critical for calculating capacity accurately.
The next step is to assign the work center to a Work Center Group. This enables consolidated capacity reporting, making it easier to track load and efficiency across multiple centers. Work Center QA is assigned to "Work Center Group 1," which allows for capacity analysis at both the group and individual machine levels.
Another critical element is setting the Capacity Per Day, which is influenced by the number of machines or labor assigned to that center. For example, if there are three machines working at 100% efficiency, the available capacity is calculated based on their combined output. This structure not only helps in optimizing resources but also provides visibility into potential bottlenecks on the production floor.
Configuring Calendars and Work Shifts
Capacity planning in Business Central also involves configuring Calendars and Work Shifts to define the operational hours of each work center. In the webinar, the Shop Calendar setup for the QA work center is configured.
The work center is scheduled to operate from noon to midnight, Monday to Saturday, simulating a 12-hour shift.
The system takes into account non-working days and holidays, automatically adjusting capacity calculations. This calendar-driven scheduling ensures that production loads are allocated accurately based on the availability of resources. Different work centers can have unique calendars, allowing for granular control over production timing. This is particularly useful for manufacturers that operate with varying shifts or complex production schedules.
Real-World Example: Custom Hardwood Flooring Manufacturer
To bring this to life, there is a real-world example of a custom hardwood flooring manufacturer in the United States. Their facility, divided into sections called "Mills," contains multiple saws—each operating at different speeds and efficiencies. In Business Central, these saws are grouped under a single work center but are tracked individually as machine centers.
This setup allows the manufacturer to:
- Optimize job assignments based on machine capabilities.
- Avoid production delays by accurately scheduling capacity.
- Analyze machine performance to identify areas for improvement.
The manufacturer can easily see how each saw contributes to overall production, enabling data-driven decisions around maintenance, investment in new machinery, or adjustments in scheduling to meet demand.
Why Capacity Planning Matters for SMBs
Many small to medium-sized manufacturers underestimate the value of structured capacity planning. Some companies only track capacity loosely, while others leverage it to avoid overloading their production floors. In Business Central, the ability to visualize workloads across work centers helps manufacturers anticipate production issues before they become critical.
For businesses running two or three shifts with high production volumes, capacity planning becomes even more crucial. It enables real-time adjustments and better resource allocation, ensuring that production schedules are met without compromising on quality or lead times.
Watch the Full Webinar
If you want to see this in action, watch our full webinar:
Microsoft Dynamics 365 Business Central Manufacturing Series Part V: Capacity Planning
Contact Us to Learn More
Ready to optimize your manufacturing operations with Business Central? Contact WebSan Solutions to learn how we can help you implement capacity planning and streamline your production processes.