Driven by our strong economy, many of our manufacturing clients have plans to increase production capacity. I sometimes share with them this strategy that Richard Schonberger describes in World Class Manufacturing:

Increase capacity in increments. If your sales forecast calls for increasing capacity by 100 widgets, start by adding a line that can handle 25. Then add separate lines as needed to handle growth.

This approach:

• Lowers the risk of hiring too many people and over investing in capital equipment if the sales forecast is wrong.
• Creates several parallel lines instead of one line. This improves flexibility, reduces the impact of a line going down, and simplifies new product introductions.