Purpose - This paper aims to uncover the significance of capacity, capacity utilization (CU) and its role in the quality and productivity improvement in an industrial environment. Besides, the current study is also aiming to explore the various ways to estimate CU and its status across the world.Design/methodology/approach - In the present study, a comprehensive literature review on capacity and CU is carried out to expose the research direction in the field of CU. This work is primarily focused on capacity, CU and their estimation methods based on the research in various industries of different countries and current status in present scenario across the world.Findings - The literature reveals that CU estimation is carried out by some government/central agencies at the national or sector level rather than the industry level in most of the productive nations. As far as industrial growth is concerned, capacity management should be carried out at a particular industry level so that engineering managers can be able to find out loopholes for huge capacity waste within the plant. It is observed that CU in the industrial sectors mainly computed by time series method, survey method, economic approach and engineering approach worldwide.Research limitations/implications - This paper tries to cover almost all research work in the field of CU in various industrial sectors. However, the organizations which are producing the product with limited demand may get benefit inadequately.Practical implications - This paper provides a vision to management toward productivity improvement through optimal utilization of available resources. As in most organizations, CU issues are much neglected areas.Originality/value - This paper provides valuable insights on capacity and CU in the industrial sector across the world. Besides, it focused on comprehensive literature of capacity and various methods to estimate CU in industrial sectors.
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