Capacity planning: why it's time to ditch excel

Capacity planning: why it’s time to ditch the excel sheets

Capacity planning is an essential process for any manufacturer. It enables organisations to get ahead of potential problems, minimise waste and maximise communication.

But to drive the most value out of your process, you need to be using the right tools. So how do you manage capacity planning within your organisation?

If you use manual processes such as a capacity planning template in Excel, then you’re not alone. I speak with manufacturers every week who run their entire planning process in excel.

Unfortunately, popularity does not equate to effectiveness. The truth is, capacity planning with Excel is an outdated and inefficient way to manage your resources.

In this article, I’ve rounded up some of the top reasons why it’s time to ditch the excel sheets and embrace capacity planning using AI.

The problem with excel

There’s little wonder why Excel has been the go-to tool for capacity planning for years. After all, it’s both accessible and low cost. However, when it comes to maximising value and optimising production plans, it begins to fall short. But why?

Five cons of using Excel for capacity planning

1. Static, non-collaborative data islands

Data in Excel is often static and disconnected from other spreadsheets and systems. Being isolated on a data island implies any updates or changes need to be done manually. This means there’s a lack of timely data, not to mention one single version of data. This prevents planners from collaborating with each other and making fully-informed critical decisions.

2. Manual effort

The process of capacity planning with Excel is almost entirely manual, from data entry to analysis. Without access to anything more than the simplest of algorithms, this is time-consuming and labour-intensive. This takes planners away from more strategic tasks such as actually planning for the future, identifying and mitigating threats to the plan.

3. Inaccurate forecasts and plans

The aforementioned static data islands and manual effort together result in bad data inputs. Combined with basic algorithms, they result in less-than-optimal forecasts and plans at best, and at worst those plans could be inaccurate.

4. Difficulty scaling

As businesses grow, so do their capacity planning needs. But Excel is not built to scale, meaning it quickly becomes ineffective as organisations try to manage more data. Phasing in and out products, resources, sites, customers and any other entity that can change over time becomes a manual, time-consuming and error-prone process. Again, the result is inaccurate or less-than-optimal plans.

5. Data security concerns

Multiple, disconnected spreadsheets containing sensitive and confidential company information scattered across servers and laptops is every IT department’s favourite security nightmare. Not only can confidential data exit the company easily, Excel spreadsheets and macros may also inadvertently invite unwanted malware into the company.

A combination of these problems results in a slower process that is much slower and riskier than it needs to be.

Luckily, there’s a solution: capacity planning using AI.

Ten benefits of capacity planning with AI

1. It’s data-driven

AI capacity planning tools use data from your existing ERP and other planning systems, and combine it with intelligent algorithms to drive automated decision making, meaning you can be sure that your process is informed by accurate, up-to-date information.

2. Mid-term planning

AI capacity planning looks at the medium-term, rather than just the short-term, making it easier to improve operational efficiency by planning ahead.

3. It’s scalable

As your business grows, AI capacity planning will be able to handle increasing amounts of data without any loss in accuracy or efficiency, so you can scale as your business develops.

4. No need for key person dependencies

AI capacity planning tools don’t rely on any one individual, so there’s no risk of capacity planning decisions being made in silos, minimising the occurrence of risk, inefficiency and inaccuracy.

5. It’s simpler

The process of capacity planning with AI is much simpler than with Excel, as it automates many of the tasks that would previously have been done manually. This reduces training costs and gives your team the freedom to focus on other tasks that require human input.

6. It’s automated

With AI capacity planning tools, you can automate many of the tasks involved in capacity planning, from data entry to analysis. This means you can spend less time on admin and more time on strategic tasks.

7. It’s integrated

Automated capacity planning tools can be easily integrated into existing systems, meaning you don’t need to set up a whole new capacity planning process from scratch.

8. It minimises uncertainty

By providing in-depth, real-time analysis, AI enables you to minimise the volatility, uncertainty, complexity and ambiguity (VUCA) of capacity planning decisions.

9. Scenario testing

With AI capacity planning, you can test different scenarios to see how they would play out in real life. This helps you to make more informed decisions and avoid any potential capacity planning disasters.

10. Increased production throughput

AI capacity planning can help to increase production throughput and effective capacity, so you can get more products or services out of your existing resources.

What solution should you opt for?

If you’re wondering where to turn to for a better solution, there are many different approaches. Here at Replan, our intelligent production planning optimising solution uses AI to take the hassle out of tasks like capacity planning. It enables users to: