The mechanism
Growth increases pressure on a capacity that takes time to expand. Poor service can then suppress demand. If that reduced demand is read as evidence that investment is unnecessary, the system can perpetuate its own bottleneck.
An everyday version
Imagine a popular workshop whose booking system has long waits. People stop attempting to book. Management sees fewer completed bookings and concludes that interest has faded, while the waiting experience itself may be driving people away.
What to look for
Track unmet demand, cancellations and service quality alongside completed transactions. Distinguish the time needed to add capacity from the time customers will tolerate a shortage. Test whether demand would recover if the service improved.
Where could you intervene?
Use evidence of unmet demand and capacity lead times when planning. Keep service standards visible, and compare staged investment with the risk of overbuilding.
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