Headway starts its product-mix sensitivity analysis by
putting into its model all the production equipment that it
plans to have in place one year in the future. This
equipment is optimum for the company’s forecast product
mix, but Headway needs to see what tools it would require
to accommodate other possible product mixes.
Headway runs the capacity model with all products that
might be in production one year from now. Since few if any
of today’s products can be expected to be in production at
that time in their present forms, accommodation is made, as
follows: (1) today’s products that are expected to be the
most enduring are put in the model as-is as a best
representation of what each product will be like one year in
the future; (2) variants of today’s products are put in the
model, each containing experimental design features that