ABSTRACT
When demand begins to exceed capacity, many companies move too quickly to outsource their excess demand or purchase new equipment. Often, these companies fail to consider the potential risks that these solutions bring with them. For example, when demand goes above a piece of equipment’s current capacity, it usually increases only in small increments. But a new piece of equipment may double capacity and leave you with excess capacity and excess costs. Moreover, if outsourcing in your industry is quick and without significant start-up costs or delays, it may seem a logical solution, but be aware that it does not always produce expected and desired results. Before being swayed by the potential benefits of a new machine or outsourcing, review and implement the recommendations presented in this chapter. Keep in mind that most of the techniques in this chapter involve changing a working method, which means that, initially (while the operator is learning the new method), production will experience a temporarily negative effect. The learning curve is usually quick, however, and the long-term improvements can be very rewarding. Also keep in mind that most of these techniques should first be applied to your bottleneck processes.
