Product and Service Design

Product and Service Design

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Product and Service Design

It is vital for any organization to undertake a self-evaluation of its core competencies. This helps the organization understand its strengths in addition to helping it identify the areas that need improvement. Therefore, most successful organizations have robust operations planning strategies, which they use to make major decisions. They use various strategies to index the level of customer demand. This is also referred to as capacity planning. Coca-Cola is one of the companies that uses capacity planning to ensure it meets customer demand.

A company can use three major strategies in capacity planning. These include lead strategy, lag strategy, and match strategy. Lead strategy involves an increase in the production capacity in anticipation of the increase in demand. On the other hand, lag strategy involves responses to actual increase in demand by increasing production capacity. Finally, match strategy lies between the lead strategy and lag strategy. It involves small incremental modifications in the capacity in response to the changing market conditions (Stevenson, 2018).

The company should use the match strategy as its recommended capacity planning strategy. The use of this strategy would enable it match its actual capacity to its customer demand. The use of this capacity planning strategy would also help in reducing overcapacity, which increases the operational costs of the company. It would also help in reducing resource misallocation. This ensures resources are deployed productively to cater to customer needs.

In conclusion, overcapacity and capacity bottlenecks reduce the efficiency of the operation of an organization, which increase its costs. Match strategy would ensure Coca-Cola only increases or reduced its capacity in response to the changes in customer demand. Therefore, it would not be faced with overcapacity or production bottlenecks. This would improve the efficiency of the operations of the company.

ReferenceStevenson, W. (2018). Operations management (13th ed.). New York, NY: McGraw-Hill Irwin