What is the difference between design capacity and effective capacity in facility planning?

• A. Design capacity is theoretical maximum; effective capacity accounts for downtime, breaks, maintenance, and constraints
• B. Effective capacity is higher than design
• C. Design capacity equals actual output
• D. Effective capacity disregards maintenance

Answer: (A)

Design capacity is the theoretical maximum output a facility could achieve under perfect, ideal conditions based on its equipment and layout. Effective capacity reflects what the operation can realistically produce, taking into account real-world losses like downtime for maintenance, cleaning, setup, breaks, and other constraints. Because these losses reduce performance, effective capacity is typically lower than design capacity.

That’s why the option stating effective capacity is higher than design isn’t right, and the idea that design capacity equals actual output isn’t true since actual output is reduced by downtime and other losses. Also, effective capacity wouldn’t disregard maintenance; maintenance and downtime are exactly the factors that reduce it.