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Managing Capacity Management: It's Not as Hard as It Sounds

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If you Google the definition of capacity management chances are you're going to find dozens of definitions, not one of which is written in plain English for the ordinary manager to understand.

Is it hopeless?

Are you going to have to get a doctorate degree in mathematics or engineering to make this process work at your company?


It's not a difficult concept at all, and those who make it seem so are probably just trying to intimidate you with their vast knowledge. Here's the layperson's explanation.

What Is Capacity Management?

Capacity management, as the name indicates, is the company's ability to manage its resources. The resources we're talking about are computers, printers, scanners, phone systems, servers, and other necessary elements of today's work environment. Capacity management involves monitoring each of these components, creating reports on their effectiveness and efficiency, fine tuning them for speed and efficiency, and capacity planning for future system needs.

There are three levels of capacity management, which we'll get to in a moment. But the overall goal of all companies should be maximizing the efficiency, cost effectiveness, and usability of all the components in the business so they're working in concert to make the jobs of the workers as easy and efficient as possible. See? Not scary stuff at all.

What Level of Capacity Management Is My Company At?

In order to know where you ought to be headed, you must know where you are. There are three levels of capacity management to discuss, and your goal as a manager is to work toward the highest level. The levels are:

  1. Managing capacity on a resource level
  2. Managing capacity on a service level
  3. Managing capacity on a business level

Resource Capacity Management

A company managing on the resource level is managing individual components of the system individually. For example, they're only looking at the effectiveness and efficiency of a single component at a time, such as how the server is handling loads, how the phone lines are handling call capacity, or how computers are handling the workload. The focus here is on specific components of the system, not the system as it functions as a whole.

In this level, each component is doing its own thing, with no regard for how each component is affecting the others. An upgrade to one component might lead to an overload of another. For example, a new bank of computers might overload an outdated server. This level of management leads to poor performance at best, and a system overload leading to a complete crash at worst. You can look at this level as "everybody doing his or her own thing."

Service Capacity Management

The second level moves from "everybody doing his or her own thing" to "everybody doing IT's thing." Here, the individual components of the business systems are pooled under IT's jurisdiction. Things such as emails, printing, phone calls, and online processing of transactions are put under IT's umbrella, and IT is responsible for managing them as a system.

At this level, upgrading one component of the system doesn't lead to an overload of another part. Though the system is now running more efficiently, everyone has to speak tech-ese, and a lot of miscommunication between the tech savvy IT staff and other workers is common. It's better than management on the resource level, but also has disadvantages which can be resolved by moving to the next level of capacity management: the business level.

Business Capacity Management

So, how do we move from "everybody doing IT's thing" to "everybody doing the business' thing?" The highest level of capacity management involves creating a system that operates by the standards of the business, not the IT department. Every process done by each component is automated, and each person is doing the function of the business, not just a tiny part, such as sales or IT.

This level is the most effective and efficient, and allows the company to provide superior customer service at a lower cost. The IT department is speaking the language of the business, not the language of the techies, so there aren't any miscommunications among the upper management, IT staff, and other workers. Work gets done seamlessly, problems are identified and addressed quickly, and all is right with the work world.

How Do I Get to a Higher Level of Capacity Management?

Now you can see that the concept of capacity management isn't difficult or scary at all. But you may be wondering how to move from level one or two toward the ultimate goal of level three: business capacity management. Relax, this part is mostly about educating others on the need for progress and nurturing relationships so everyone's on board with the process.

First, gather a thorough understanding of each process of the company. Know how each part of the process relates to the others. Next, find a way to automate these processes for the easiest, most cost-effective methods of operation. Then, focus on assuring senior management of the importance of moving in this direction. Lastly, step up as the ambassador to the company, explaining to workers how the new system is going to make their jobs easier and improve the company as a whole.

When moving towards business capacity management, it's important to choose a system that will be easy to implement. Carefully plan each step, deciding how the implementation process will affect workers in each department. While the focus is always on the actual work of the business, don't leave out the needs of any department.

Make sure customer service, accounting, and other departments that operate outside the production process are also involved in decision making. You'll need to know their concerns, just like you need to understand how the rest of the workers get their jobs done each day.

At the end of this process, you're rewarded with a fully functioning IT department, capable of communicating with and meeting the needs of all the workers across the company. If you've approached it the right way, managing your capacity management isn't difficult at all.

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John Leger has been married for 25+ years and has six children.  He is a self-taught web developer who spends a lot of time learning new technologies and sharpening his skills.  His ability to learn new things quickly has enabled him to skillfully play the guitar, keyboard, flute and bass.  In his off time, he loves to hunt and ski.  He’s also the lead instructor at a Taekwondo Academy in his home town where he teaches classic Chung Do Kwon.
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