The Role of Capacity Management in Manufacturing Strategy: Experiences from the Australian Wine Industry

Abstract

There has been little research focused on identifying the position and role of capacity management in strategic manufacturing decision making. This research presents the findings of a major investigation into strategic capacity management in the Australian wine industry. The research found that advanced processing technology is being used as part of a strategy for increasing capacity in this industry. It was also found that supply dependability and product cost/price were the most important competitive priorities for wine production, after product quality. All three of these were found to be directly influenced by the level of capacity management. The importance of capacity management varied, depending on the category of wine producer (32 different categories were identified). It was also determined that the strategic position of capacity management in the manufacturing decision making process is linked to production planning and control, quality control and assurance and plant and equipment.