Manufacturing lead times

Manufacturing lead times are very important to all production and inventory control systems. This is the time for order to start to order completion inside the factory. They influenced nearly every aspect of the planning and execution activities that take place within production and inventory control the system.

It could be asserted that lead times are one of the most important measures of manufacturing performance, since many costs can be related directly to them.

Manufacturing lead times can be defined as the time that elapses between the release of the order to the shop floor and the completion of all operations on the order and its receipt into stock.

Traditionally, manufacturing lead time is comprised of five components or activities:
*Queue: Time waiting for work to begin
*Setup: Time required to set up equipment
*Run: Time required to work on the part
*Wait: Time waiting for the part to be moved to the next operation
*Move: Time taken to move the part to the next operation

Reducing the cumulative lead time or the sum of lead times for purchasing materials, manufacturing operations and product assembly allows a company to reduce the planning horizon for production.

Reducing the planning horizon allows a company to increase the accuracy of its demand predictions.
Manufacturing lead time