Cycle-time reduction

FICCI

CE

Scenario

All organizations, whatever their products, face the

same daily practical problem - that customers want
products to be available in a shorter time than it
takes to make them. This means that some level of
planning is required."
To meet customer demands it is highly important to
meet customer demand at right time in right quantity
at right price i.e, reduce lead time days.

FICCI

CE

Cycle-time reduction

Long cycle-times not only prevent prompt delivery of product/

service to your customers, but also increase costs. One of
the best ways to cut down on your cycle-time is to conduct
activities in parallel and eliminate unnecessary waste times.

FICCI

CE

Lead Time : Time between the initiation and

delivery of a work item (this includes the
Cycle Time)
Cycle Time: Time between two successive
deliveries of work items in the process(this
includes the Process Time)

FICCI

CE

Lets take an example of Security Check-In at the Airport:

(a) Suppose you arrive at the check point and have stood in
a queue at 1100 hrs (assuming there couple of passengers
ahead of you) and you are through with the security check
with your hand baggage and boarding card duly stamped at
1125 hrs. The LEAD TIME is 25 min.
(b) Now say, the passenger just ahead of you completes
security check 1117 hrs and later you are through with the
security check at 1125 hrs. The CYCLE TIME is 8 mins.

FICCI

CE

cycle time is compared with task time.

Lead time y compared with commitment of

delivery

FICCI

CE

In a complete JOB , Process or any start to

end the different stages are refer to a cycle
Lead time = completion of a job e.g making a
car its order asembling paint ,tyre ckd fitng is
cycles and a customer get it after one month it
is the lead time

FICCI

Lead time is typically used to specify how long the

delivery of a piece of equipment will take from
purchase order to delivery.
Lead Time is linear, how long it takes to get from
one place to another or to do something.
Cycle Time is circular, the time between doing
something once then doing it again later.

CE

FICCI

CE

Lead time= cycle time Xwip

FICCI

CE

Cycle-time reduction

Broadly speaking, an organization competes on the basis of quality, cost,

flexibility and time. Today's discriminating customer demands worldclass quality at a competitive price. When all the leading companies in
an industry have achieved a high level of quality, a focus on quality alone
cannot keep a company competitive.

FICCI

CE

Cycle-time reduction

Quality then becomes a common expected factor, which must be

complemented by a faster response time and flexibility.
Increasingly, cost and quality are viewed as residuals or outcomes
of competing on the basis of time and flexibility.

FICCI

CE

Cycle-time reduction

In business, time is not infinite and limitless. Competing on the

basis of time is defined to include the following:
using time as a strategic weapon
identifying market opportunities
responding to those opportunities before competitors do and
eliminating non-value-added activities.

FICCI

CE

Cycle-time reduction

Fast-cycle capability contributes to better performance across the

board.
Costs drop because production materials and overhead do not
accumulate as work-in-process inventory.
Customer service improves because the lead-time from receipt
of order to shipment diminishes.
Quality is higher because the production cycle overall cannot
speed up unless everything is done right the first time.

FICCI

CE

Cycle-time reduction

Time advantage is also an organizational capability - a level of

performance that management shapes and builds into the company.
The basic idea is to build on organizational operating systems that
perform without the bottlenecks, delays, errors and inventories most
companies live with.
The faster that information, decisions and materials can flow through
a large organization, the faster the growth and development.

FICCI

CE

Cycle-time reduction

In summary, time-advantaged companies enjoy one or more of the

following benefits, relative to their peers: increased productivity;
pricing flexibility; reduced risks; reduced costs and increased
response capability.

1. Activities Performed in serial

2. Activities performed in parallel