Spare Capacity – Eliminate or Monetise

Spare Capacity is when you are paying (or have paid ) for something that is underutilised.

It is not generating the value or income that it should be.

Spare capacity is everywhere and could manifest itself as underutilised people or assets.

Underused buildings or equipment – space or time.

Sometimes it is hiding in plain sight – sometimes you can’t see it until you think about it differently.

There are two basic approaches.

You either make that spare capacity work for you – somehow you extract the value or sell it – one way or another you monetise it (sell it).

Alternatively you reduce or eliminate it.

Of course many people will defend spare capacity as necessary “just in case”.

In some situations this may be defendable  – but you really need to vigorously test this assumption.

Spare capacity is often used as a “buffer” for poor processes.

Many of the new business models exist to provide “capacity” just in time, just for me.

If I can access what I need, when I want it I am less likely to need to own it.

A few examples of Business Models addressing spare capacity – note that some (e.g. Uber-X)  service both sides at once.