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Posted by Javeria Rahim
In manufacturing, there are three key metrics – takt time, cycle time, and lead time that play a crucial role in optimizing production flow and helping manufacturers meet customer demands. However, these terms can sometimes be misinterpreted or confused with each other. This article provides a comprehensive analysis of each metric, it will delve into their definitions, calculations, relationships, and highlight the key differences between takt time vs cycle time vs lead time.
Takt is a German word that translates to beat or pulse. Considering the definition of takt time in manufacturing, the term is apt. Simply put, takt time is the time or the rhythm at which your manufacturing plant should produce to meet customers’ demand.
To calculate takt time, you need to know the production time and customer’s order. The formula is:
Takt Time (T) = Available Production Time (APT) / Customer Demand (D)
Whereby:
Available production time represents the total time available for production within a specific period, excluding planned breaks, maintenance downtime, or other non-productive activities. It’s typically calculated by subtracting planned non-production time from total operating time.
Customer Demand refers to the average number of units a customer expects to receive within a chosen time frame. It can be daily, weekly, or any relevant timeframe based on your production cycle.
Let’s talk about a fan manufacturer that has 8 hours of production time and a customer has just placed an order for 50 fans for the day. Here’s how the manufacturer can calculate takt time:
Takt time: 480 minutes / 50 fans
Takt time: 9.6 minutes per unit
The fan manufacturer will need to make a fan every 9.6 minutes to complete the 50-fan order for the day.
When you produce as per takt time, you avoid the risk of overproduction or underproduction, and you make sure that the delivery of final products is also on time. Here are some benefits of working with Takt time as your north star:
Cycle time is the actual time that it takes to produce a single unit of a product. Cycle time involves all the time taken to complete tasks in producing one product, including idle time and other wasted time.
Cycle time calculation requires two things: production time and units produced in the said production time. To calculate, divide the production time by the units produced.
Cycle Time (CT) = Total Process Time (TPT) / Number of Units Completed (NUC)
As an example, consider a bicycle manufacturing plant that produces 100 units every 480 minutes. Here’s how you can find out the cycle time for making a bicycle:
Cycle time: 480 minutes / 100
Cycle time: 4.8 minutes per unit
It is important that you know how much time it takes for you to complete one product. Here is what cycle time helps you with:
Lead time is the time it takes from the placement of a customer’s order to the final delivery of the product. It reflects the customer’s experience and includes all internal production processes, procurement, order processing, and delivery logistics. Lead time is intricately linked to takt time and cycle time. Takt time helps you reduce lead time; the lesser the takt time and cycle time, the faster you can fulfill customer orders.
Lead time is merely the time between placing and fulfilling an order. To calculate the lead time all you need to know is when the order was placed and when it was delivered.
Lead time: Planning phase (pre-process) + Assembling phase (procuring raw materials and assembling them) + Delivery phase
Lead time is critical to streamline the manufacturing process. Here is how you can use lead time to your advantage:
Enhanced Customer Satisfaction: Lead time directly impacts customer experience. By understanding the total time it takes to fulfill an order, you can set realistic delivery expectations and ensure customers receive their products promptly.
Improved Inventory Management: Knowing the time it takes to acquire raw materials and complete production allows for more informed decisions about stock levels, so you can avoid stockouts that can disrupt production. It also helps minimize the holding costs associated with excessive inventory.
Optimized Production Planning: Lead time data plays a crucial role in production planning. Understanding the total time required from order placement to delivery allows for more accurate scheduling of production runs and resource allocation.
Understanding the relationship between these three metrics is crucial for optimizing production flow. Here’s a breakdown:
Takt Time | Cycle Time | Lead Time |
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While these metrics provide valuable insights, several factors require consideration for a more nuanced understanding:
Formula: Batch Takt Time (BT) = Available Production Time (APT) / Daily Batch Demand (DBD)
Daily Batch Demand (DBD) refers to the number of batches required to meet customer demand per day. It can be calculated by dividing the total daily customer demand by the batch size.
Formula: Unit Takt Time (UT) = Batch Takt Time (BT) / Batch Size (BS)
These key performance metrics can help improve the production output of manufacturing plants. You can easily meet the delivery time requirements of your customers without facing the risk of any additional costs or delays. The key to getting the right information is committing to proper time and motion studies. Once you have calculated the cycle time, it is easy to balance the line to takt time and reduce lead times.
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