Notes:

Capacity flexibility means having the ability to rapidly increase or decrease production levels, or to shift production capacity quickly from one product or service to another. Such flexibility is achieved through flexible plants, processes, and workers as well as through strategies that use the capacity of other organizations.

Flexible Plants Perhaps the ultimate in plant flexibility is the zero-changeover--time plant. Using movable equipment, knockdown walls, and easily accessible and reroutable utilities, such a plant can adapt to change in real time. An analogy to a familiar service business captures the flavor quite well—a plant with equipment "that is easy to install and easy to tear down and move—like the Ringling Bros.-Barnum and Bailey Circus in the old tent-circus days."

Flexible Processes Flexible processes are epitomized by flexible manufacturing systems on the one hand and simple, easily setup equipment on the other. (See box "Capacity Flexibility at Aladan Corp.") Both of these technological approaches permit rapid low-cost switching from one product line to another, enabling what is sometimes referred to as economies of scope. (By definition, economies of scope exist when multiple products can be produced at a lower cost in combination than they can separately.)

Flexible Workers Flexible workers have multiple skills and the ability to switch easily from one kind of task to another. They require broader training than specialized workers and need managers and staff support to facilitate quick changes in their work assignments.