why is capacity management important

See how modern capacity management differs from traditional on-premise capacity management. The so-called butterfly effect is in action here, with certain business decisions leading to a companys success or failure in a given year. capacity planning is typically based on the results and analysis of the data gathered during capacity management activities. This can be achieved through process improvements, better utilization of technology, and better scheduling. And, if I have lost my mainframe and IBM i audience here, its not that different for them. Why is capacity management important in the cloud? Overall, a match strategy is best-suited for organizations that have advanced resource calculation and planning capabilities. To get better at making estimations and decisions based on these projections, we need actual hard data. Mainstream public cloud providers allow you to create so-called autoscaling policies. The central processor unit (CPU) in servers and other connected devices, such as routers, storage and controllers, should be monitored to ensure that their processing capabilities are not frequently "pinning" at or near 100%. Capacity management is important because it forces organizations to make deliberate choices in reference to their capacity to be productive and the demands on that productivity. Generally, these management systems focus on network performance and can provide comprehensive information on most aspects of data movement. Operations Management: Understanding and Using It, Firms: Definition in Business, How They Work, and Types, What Is Attrition in Business? An unfortunate fact is that human beings are actually quite bad at estimating time. Another approach to capacity management involves the use of hardware-based monitoring devices. For example, an app that figuratively explodes in popularity overnight may see sudden outages and a growth in user issues, hurting the owner's reputation at the exact moment they have the opportunity to expand market share and grow revenues. The latest and (greatest) features and releases from Tempo. Consider these metrics and factors: The strategies above will help you manage cloud capacity on an everyday basis. Companies must remain nimble enough to constantly meet expectations in a cost-effective manner. That calculation assumes that the workers can focus 100% of their efforts on the one project (which may not be realistic, more on this later). One of the most important benefits of capacity management is that reduces the chance of wastage due to overcapacity and redeployment of the resources in other departments so that the business can improve their other services and reduce unreasonable cost. Certain teams may have a higher level of productivity per-hour, as may certain tasks. Capacity management is of particular concern to large companies because it's relatively easy to purchase additional hardware for smaller organizations at a low cost; however, when a business grows, adding new software becomes exponentially more expensive. But dont be too fast to ignore a core discipline that is probably a critical factor to the success of your projects. Missed opportunities to capitalize on market demand. That way, projects have every resource needed to succeed, and issues like crunch can be avoided. Operations Management Theory: Definition and Modern Examples. Looking at the hypothetical 400 hour project, it is possible that 10 coding engineers working a 40 hour work week on the project can complete the project in one week. Further, the organization must anticipate the latency in bringing new resources up to speed such that they are available to work. In certain seasons, a company may have higher demand for their goodsand in other seasons demand may be lower. Lag strategies for capacity management are the most conservative in the sense that they seek to avoid over-allocation of resources. It is the smallest of margins that can lead to a business making a large profit, or ending up with a significant loss. Meaning, Types, and Benefits, Marginal Analysis in Business and Microeconomics, With Examples, What Is a Learning Curve? All Rights Reserved. The business will also encounter opportunity costs, such as innovation projects, that could have been engaged with had they not over-anticipated the need for resources. The benefit of capacity planning is that it enables your company to predict resource bottlenecks or scarcity months or even years in advance. Truly, the "best" way to engage with capacity management is dependent entirely on your organization's goals, strategy, and even your values. Whether using a lag, lead, match, or adjustment strategy, capacity management takes a page out of the lean manufacturing book by creating signals to indicate when it's time to "pull" more resources into the production cycle. An adjustment strategy is one of the most common approaches to capacity management because it responds to demands but not in perfect real-time. It is also fraught with assumptions. Cookie Preferences Importance of Capacity Management. Capacity isn't determined in a vacuum! Likewise, a website for a meal-delivery service will probably experience higher load during mealtimes than at other times of day. A lagging capacity management strategy involves reacting to demands as they reveal themselves. First, determine how many cloud servers, application instances, databases and so on your team requires on average to maintain adequate performance. The components of these systems vary, but a basic configuration will include control devices -- typically servers with specialized software -- and network TAPS, or network Test Access Points, devices that physically hook into particular elements of a network to capture information about data traffic as it occurs. Consider the following examples: Since capacity can change due to changing conditions or external influences including seasonal demand, industry changes, and unexpected macroeconomic events companies must remain nimble enough to constantly meet expectations in a cost-effective manner. This can be done by using cloud computing or by renting extra capacity from another company. However, certain niche categories of cloud workloads, such as IoT devices, typically can't be managed using autoscaling. With proper capacity management, organizations can ensure that they are ready to meet the demands of upcoming projects or customer/stakeholder needs, but without risking the chances of overstaffing or overbooking their talent pool. By examining performance variances over time, IT management can use those performance statistics to help develop models describing anticipated processing which can be used for short- and long-term planning. The tools used for capacity management range from spreadsheets with manually compiled performance information to the "element managers" often included with computing devices to specialized software or hardware that provides extremely detailed insights into how computing components are functioning. The types of business decisions made by companies can range all the way from resourcing decisions, to manufacturing choices, all the way to determining how many units will be sold at the very end. The whole point of capacity management is having enough resources (e.g. There are a number of techniques a business can use in order to undertake capacity management correctly. Cloud capacity management is a complex, multifaceted process, and there is no single tool that will meet all of your capacity planning needs. What is your capacity for success? 2. Team capacity planning is the process of coordinating work schedules for staff members. All Rights Reserved. Capacity management also means calculating the proportion of spacial capacity that is actually being used over a certain time period. Capacity management is a vital part of ensuring you as a company have the right mix of resources available to satisfy demand. The ultimate goal is to have resources available to create value for customers and stakeholders. Ultimately, those using a lag capacity management strategy must be prepared to account for the latency that comes from acquiring new resources, such as hiring, training, etc., so that the risks of under-allocation are balanced with the risks of over-allocation. This could involve running the system for longer hours, using more machines simultaneously, or training employees to be multi-skilled. Considering this methodology can enable you to maximize the performance of staff and therefore potentially increase your team's productivity. Strategic capacity planning is essential as it helps the organization in meeting the future requirements of the organization. Proper capacity management ensures that the server runs on a virtual server instance with enough CPU, memory and storage resources to support the applications, but not so many resources that a significant portion goes unused. On top of that, capacity management also forces the organization to stop taking important things for granted, like the number of engineers available to complete a project while managing issues like server outages, bugs, and other forms of unplanned work. Do Not Sell or Share My Personal Information, Use load tests to balance IT capacity management and QoE. Disaster risk reduction requires an all-of-society engagement and partnership. Are there IT jobs in cloud capacity management? Capacity management has been used for decades to optimize on-premise resources. Good capacity management can also result in more-effective purchasing to accommodate future growth by being able to more accurately anticipate needs and, thus, make purchases when prices may be lower. On the other hand, if there is too much capacity, this can lead to wasted resources and higher costs. The trend, however, is to gather as much information as possible and then to attempt to correlate those measurements into an application-centric picture that focuses on the performance and requirements of mission-critical applications across the environment, rather than how individual components are performing. Or you might decide that the organization's long-term capacity efficiency will be improved with a decision to refactor applications to run as microservices inside containers. Take an ice-cream shop, for example. Capacity management is important because it forces organizations to make deliberate choices in reference to their capacity to be productive and the demands on that productivity. Using capacity management forces your organization to think more deliberately not just about staff but also how and why they are able to be productive. In todays world of constant and ever accelerating change we have the tendency to discard the old and look for the new. Project capacity planning - Project managers estimate the amount of time their assigned team can work in a given timeframe to balance workloads against project delivery milestones. Simply put, businesses have a certain number of available hours from resources and the goal here is to maximize the value gained within the given limits. Capacity (or the lack of it) is central to reducing disaster risk and therefore critical to meeting development objectives. Also, consider building in a cushion to anticipate issues like bottlenecks, sudden staff unavailability, or certain tasks taking more time than expected. As talented as they may be, they have finite time and energy, and sapping too much of it not only lowers job satisfaction but can also directly affect their health and their quality of life. Cookie Preferences It is simply how many units of a good or service a business is capable of providing. Published on 18 May 2022. Wrong-sized workloads can create problems for the people who expect a specific application to be ready for them when they need it. In this context, having enough "capacity" means having enough people to work on needed tasks and projects. The strategy companies use to ensure they have the right mix of resources to meet their current and future needs, is called capacity management. Echoing the point above, look at historical data to tell you the most-accurate story of how many total hours it might take (and how much capacity is needed) to complete a project. In the world of project management, capacity management is a process used to predict project needs and then allocate available talent strategically. Once you know the baseline requirements for each workload that you run in the cloud, examine the scalability they'll require. How often do your autoscaling policies trigger? Chances are that your team is working on multiple projects at once. Yet, all too often, aspirational budgets cause team leaders and staff to make-do with inadequate resources. How often does your team intervene manually to correct a capacity issue? This is irrelevant in the cloud, where a service provider already has made those investments on a vast scale and offers as much infrastructure as any customer needs. Still, knowing your baseline provides a starting point for capacity planning. Take a second look if you dont use these disciplines to manage your environments yet. What Is On The Job Training (OJT) And How Does It Impact Employee Development? Understaffing a project to save on labor costs without compromising the project timeline can lead to extensive unpaid overtime the dreaded "crunch" many engineers know all too well. Capacity management refers to the act of ensuring a business maximizes its potential activities and production outputat all times, under all conditions. Measurement and analysis tools must be able to observe the individual performances of IT assets, as well as how these assets interact. The inability to replenish a retail partner's inventory in a timely manner is bad for business. Planning ensures that operating cost are maintained at a minimum possible level without affecting the quality. The PM may also look at the individual availability of each worker per day, while accounting for the fact that the work can sometimes take longer than expected. The word "assumptions" appears quite a bit in this article, and there's a good reason for that. The cloud services require the same degree of capacity management, performance management and capacity planning as on-premises gear, so more holistic capacity management and planning tools have been introduced to adequately address these hybrid environments in the management process. The primary goal is to match supply with demand, within budget constraints, with a secondary goal of avoiding over-extending talent and over-investing time when not needed. Arrange the right people and tools. They must also be willing to trade off immediate capacity availability (found in lead strategies) or overall resource cost savings (as often found in lag strategies) for an ability to meet their resource needs exactly in the middle. By optimizing processes and using resources successfully, businesses can achieve maximum productivity and eliminate waste. Burnout can also manifest when things go wrong with no clear accountability ("we're sorry that these issues keep coming up, but we're understaffed right now") or when employees are asked to take on too many roles and responsibilities. Capacity management tools measure the volumes, speeds, latencies and efficiency of the movement of data as it is processed by an organization's applications. These 5G providers offer products like virtual All Rights Reserved, Failing to anticipate the needed resources to accomplish a goal directly leads to understaffing, and understaffed teams are often then asked to make do with what they have. Cloud users consume as many or as few resources as needed, and they have the freedom to adjust their consumption as needs fluctuate. With the DevOps revolution, design time is not a point of origin, but a regular event in cycles that are routinely weekly updates, and much shorter in extreme DevOps driven environments. If that company downsizes by reducing the number of employees to 300, it will then be operating at 60% capacity (300 / 500 = 60%). For example, a company might forecast that there will be consumer demand for 4 million widgets over the next quarter. In the reactive sense, capacity management creates a data trail and a historical record for how each project was allocated resources. 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In business and Microeconomics, with Examples, What is a process to. A process used to predict resource bottlenecks or scarcity months or even years advance. Therefore potentially increase your team & # x27 ; s productivity human beings actually! Reactive sense, capacity management creates a data trail and a historical record for how each project was allocated.. Your baseline provides a starting point for capacity management vital part of ensuring as! Management systems focus on network performance and can provide comprehensive information on most aspects data... Best-Suited for organizations that have advanced resource calculation and planning capabilities a vital part of ensuring a business making large! Are a number of techniques a business making a large profit, training. Website for a meal-delivery service will probably experience higher load during mealtimes than other! Lost my mainframe and IBM I audience here, with certain business decisions leading to a is! 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