What is Capacity Planning?
Capacity planning is the strategic process of determining how much work your team can realistically handle within a specific time frame. It answers the key question: Can we deliver? Unlike resource planning, which is more tactical and focuses on assigning tasks to specific people, capacity planning looks at the bigger picture of team availability, skill sets, and workload distribution.
To do capacity planning effectively, project managers analyze:
- Headcount – How many people are available?
- Skills – Do team members have the expertise needed for upcoming projects?
- Current workload – How much of their capacity is already allocated?
- Tools and systems – Are processes and equipment in place to support delivery?
For example, if a design agency is approached by new clients, they must assess whether their current staff has both the skills and the time to take on the additional work without overloading the team. If the analysis shows a gap, the agency might bring in contractors or consider hiring new staff.
When done well, capacity planning prevents overcommitment, reduces burnout, and ensures smoother project delivery. It also supports long-term growth by helping businesses forecast when to scale up their workforce.
