Analyzing Change on Capability and Decision Making Introduction: SC focuses on customer needs (Chopra & Meindl, 2007), which means that internal operations, including capacity levels ©, are adapted to customers lead time (L). By giving L and knowing the capacity, companies can calculate production (P). The P level should be sufficient for customer demand (D). Predictable D determines P in L resulting in ©. Furthermore, the production cost can be fixed or variable. Linear cost increases when production increases, exponential cost increases more than production increases, and inverse proportional cost decreases when production increases. The total cost can increase or decrease depending on the combination of cost types and production volumes (Buyukkaramikli, Bertrand & Ooijen, 2013). The optimal capacity level is one at which a lower cost produces the quantities required by customers at the right lead time ( Chopra & Meindl, 2007 ). For accounting purposes it is regular practice to capitalize excess capacity. Companies invested in high levels of capacity and the total cost was capitalized and amortized over a certain period of time following accounting rules such as narrow line depreciation (Yahya-Zadeh, 2011). However, becoming price competitive in the market, capacity investment decisions should consider the additional cost for capacity resources that are unused or unused capacity to optimize capacity investments (Slack & Lewis, 2011) . Changing capacity: the capacity decision represents a significant investment for companies and is part of the SC strategy, if too large, producers generate surplus by reducing prices, if too small, scarcity, losing sales opportunities (Slack & Lewis, 2011). Evaluation is a complex activity because the decision on the data to determine the capacity is not always available. Companies can use an informal approach, mathematical calculations or linear models to determine capacity levels (Buyukkaramikli, Bertrand, Ooijen, 2013; Yahya-Zadeh, 2011).ReferenceWorks CitedBuyukkaramikli, N., Bertrand, J. & Ooijen, H. (2013) ' Periodic capacity management with lead time performance constraints', OR Spectrum, 35 (1), pp.221-49. Chopra, S. & Meindl, P. (2007) Supply chain management : Strategy, Planning and Operation. 3rd ed. Upper Saddle River, NJ: Pearson/Prentice Hall.Slack, N. & Lewis, M. (2011) Operational Strategy. Harlow: Financial Times Prentice Hall.Yahya-Zadeh, M. (2011) "A new framework for capacity costing and inventory variance analysis", Journal of Applied Management Accounting Research, 9 (2), pp.61-81.