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Among the various KPIs to be monitored, the measurement of the production lead time is used to minimize any inefficiencies and costs incurred by the company. In this TechStory we will talk about how it is calculated, how it is optimized and the resulting benefits.
In manufacturing, the term production lead time (also called lead time) indicates the time required to produce a particular product. A time frame that measures how long it takes for a product to be shipped to the customer, from the moment the production request arrives.
The different times that form the production lead time
To calculate the lead time, the different moments that make up the entire production process must be added together.
In fact, the production process does not begin or end with the simple creation of the product. However, there are different moments that make it up. We can identify three macro-moments which, within them, contain temporal KPIs to be measured individually.
These 3 moments are:
– Procurement time of raw materials or semi-finished products then used in the production process. The pandemic before and now the current energy crisis and the conflict in Eastern Europe are creating various difficulties in this phase of the production process, increasing delivery times and the difficulty of finding some raw materials or semi-finished products quickly. The consequence is that time-to-market is lengthening and it is increasingly complex to guarantee agile and efficient responses to new market demands.
– Cycle time or production time which is the time necessary for the products to go through the entire production process. It includes the analysis of scheduled and unscheduled downtime, queue and waiting times. KPIs that are important for calculating OEE and consequently production efficiency, but which alone are not enough to have an overview of the entire shop floor.
– Logistics management time to move the finished product to the warehouse, including all the handling and final shipment of the product to the customer.
Why optimize production lead time
An optimized production lead time has several benefits, some of which are also identified as important in the 7 MUDAs of lean manufacturing.
For example, costs are lowered thanks to a reduction in inventories and the optimization of production scheduling. In an increasingly competitive market, with an accelerated time to market and the request for customized products, it is the solution for reacting quickly and easily to changes in demand. Changes that are increasingly influenced by the consumer and the macro-environment surrounding the sector in which they operate and to which manufacturing companies must know how to respond.
How to calculate production lead time and improve
To facilitate the calculation of production lead times, manufacturing companies can implement data collection solutions, such as MES software, which automatically collect all this information and process it.
Starting from the analysis of the individual moments that make up the production lead time, the company can identify areas of inefficiency and waste. Thanks to the data collected, it is also possible to identify improvement actions and thus optimize the entire process, with the advantages described above.
The TechMass solution, thanks to the various modules it is made up of, is able to guarantee real-time control over the entire production process. The simplicity of our dashboards allows you to immediately analyze some KPIs, such as production stops, by generating reports with the data collected in real time.
Systems such as the Andons are another valid support on the production side for monitoring the progress of the various lines in real time and any critical issues that need to be addressed.
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