Manufacturing cycle time is the time it takes to complete a product unit from conception to shipping. As long as the product quality is not compromised, a shorter manufacturing cycle time is better for business. Knowing the cycle time can help businesses move towards lean manufacturing by indicating what goal to strive for.
This article covers the crucial aspects of manufacturing cycle time, the importance of reducing cycle time in manufacturing, how to calculate manufacturing time and its associated challenges.
What Is Manufacturing Cycle Time?
Manufacturing cycle time is the total time required to convert raw materials into finished goods, including loading time, machine tools and sub-assemblies time, inspection time, material movement, idle waiting time, and all other actions performed during finished goods manufacture.
Manufacturing cycle time is an essential metric for determining the success of a manufacturing process. Production companies utilize the manufacturing cycle system to estimate the time taken to finish the product with the available raw materials, and capital.
Here are the key factors to note about manufacturing cycle time:
- You can divide the net production time by the total number of items in the production, giving you a different perspective on the cycle time and performance.
- It is the period of time that is consumed for the product to cross the start-to-finish stage, between receiving the customer's purchase order to delivery.
- It includes the time spent processing, moving, inspecting, and queuing an item and the time spent inactively moving through the manufacturing facility.
- The total number of items divided by the net production time yields the production cycle time in the manufacturing process.
- It is made up of several parts, including setup time, machine running time, material handling time, and quality control time. It can be used to identify inefficiencies and areas for improvement, as well as to calculate production costs and make pricing and production planning decisions.
- Manufacturing cycle time is important in determining a manufacturing process's overall productivity and should be monitored and managed.
Why Track Manufacturing Cycle?
Businesses can benefit tremendously by tracking manufacturing cycles. Manufacturing cycles can be used to fulfill the primary goals of productivity, efficiency, and quality in the facility.
Diverse businesses are working on a small, medium, or large scale. The manufacturing cycle time formulas allow the companies to highlight the inefficiencies and faults in the operations, gain access to daily data analysis of daily operations, and eliminate loopholes.
Here are some other undeniable benefits of tracking the manufacturing cycle time:
Increase in Profits
It helps businesses determine their major spending, reduce their time-consuming and wasteful spending, and enhance profits by working on the right sources. Companies can employ their resources better by checking the manufacturing cycle.
Consistent Production Rates
It helps organizations to discard excess waste, maintain better relations with the workers, and enhance productivity and production rates.
Gain Competitive Advantage
Cycle time assists businesses in staying ahead of the competition by providing real-time data on delivery time ranges, enabling them to reduce production time and gain a competitive advantage.
Customer Satisfaction
Finished products must be delivered on time to develop trust and retain long-term customers. Effective manufacturing cycle time estimation enables businesses to provide customers with realistic product development timelines facilitating loyalty.
Insights on Business Spending
Manufacturing cycle times ensure that manufacturers have better control over all business operations and processes. Cycle time can be tracked by business owners, manufacturers, and product managers to improve productivity and gain better insights into their business processes.
How to Calculate Manufacturing Cycle Time?
The manufacturing cycle time formula helps to calculate and analyze the production processes involved. The total production time includes load and unload time, application downtimes per piece, and process time.
The manufacturing cycle time formula is the sum of value-added and non-value-added time or non-productive hours. This is how you can find the manufacturing cycle time.
Manufacturing Cycle Time = Process Time + Material Movement Time + Time included in Inspection Time + Idle Waiting Time
Value Added Hours - Sum of Process Time and Inspection Time
Non-Value Hours- Sum of Queue Time and Movement Time
To monitor the time a manufacturing company takes to complete a cycle from beginning to end, it may consider the following four types of elapsed time:
Process Time
The time required to convert raw materials into finished goods is called process time, and products can be redesigned to reduce process time.
Move Time
Move time is the time it takes to move an order from one workstation to the next, which can be reduced by bringing workstations closer together and using conveyors to move goods continuously.
Inspection Time
The time required to inspect a product to ensure it is defect-free is called inspection time. Integrating it into the manufacturing process is possible. The need for separate or unique inspection operations is reduced by optimizing the inspection time process.
Queue Time
It refers to the time required to wait for action before accessing workspaces. Business teams can reduce the total amount of inventory in work-in-process to reduce queue time.
How to Reduce Manufacturing Cycle Time?
Cycle time is a comprehensive delivery metric that requires best practices like limiting work in progress, eliminating wait time, working on small, streamlining code review and quality assurance processes, and maintaining an efficient team composition and culture.
There are various ways to reduce the manufacturing cycle time, some of the popular ones are discussed below:
Streamlining Complete Production
Manufacturers can reduce cycle time by improving the overall system, and by identifying and eliminating bottlenecks during manufacturing. Evaluating operations is an excellent way to identify inefficiencies and cut the time needed to increase capacity. Untested shortcuts should be avoided because they lead to quality control issues and dissatisfied customers.
Improvement in Systems and Equipment
Examine the conditions of the tools and equipment utilized in the process. If the systems, and machinery are obsolete, it is the right time to update the tools and equipment employed in the system.
Use Analytics Effectively
Check the analytics, statistics, and the performance of production timely. It is crucial to dive deep into the multiple operations so there are no loopholes. Manufacturers should use analytics to identify inefficiencies in production processes, such as whether the production time is getting stretched or the quality is consistent. Create and gather data points wherever possible to identify potential inefficiencies.
Better Training of Employees
Create an environment in which employees feel comfortable making recommendations to improve operational quality, leading to a boost in their morale. A manufacturer will ultimately operate more profitably with more qualified and dedicated employees.
Work on Smaller Segments
Reduce process and product risk by making work items as small as possible. Smaller tasks ensure an effective workforce and eliminate quality issues. It encourages workers to proactively focus on the existing elements with all dedication and slowly expand the focus on more work items.
Factors Affecting Manufacturing Cycle Time
Analyzing factors affecting cycle time helps to produce the best quality output. Let's understand them in detail -
Design phase: time spent on product design and prototyping
The design of a product must be considered during the initial planning phase. The product design will undertake evaluations and modifications, and a prototype will be built to test the initial concept. Prototyping is frequently divided into alpha, beta, and pilot stages. The pilot production stage is critical in the manufacturing cycle because it allows for any modifications or upgrades to the product before it enters the manufacturing process.
Sourcing phase: the time required to source materials and suppliers
The product must be designed after the prototype has been examined and approved. This implies making adjustments and picking the right components and materials to reduce costs while improving quality. Choosing the right resources, tools, and raw materials is crucial to enhance efficiency.
Production phase: the time required to manufacture the product
The production step entails the actual execution of all operations required to convert the product to its finished state, which requires using storage, tools, manufacturing processes, and a skilled workforce. It includes assembling components, implementing finishing touches, and conducting a product test. Modern equipment, warehouse space, supplier relationships, and other resources are required for larger-scale, more complex manufacturing.
Delivery phase: the time required for transportation and logistics
Create a system for monitoring and handling shipments to ensure that products are delivered on time and in good condition, use technology for monitoring shipments in real-time, and create a system for reorganizing materials and parts to ensure that elements are available when needed.
Administrative phase: time spent on administrative tasks such as documentation, quality control, and testing
Customer service and service technicians for setup, configuration and designing, and building, maintenance, repair, and training are all important aspects of post-manufacturing. The design and manufacturing processes should be updated to improve manufacturability and reliability, while documentation, assembly, and test procedures should be followed.
Why Optimizing Manufacturing Cycle Time Is Important?
The production cycle measures a company's ability to turn assets into profits, stock into commodities, and distribution networks into revenue. Here are some of the benefits of reducing manufacturing cycle time:
- Opportunities to Experiment and Innovate: Cutting-edge research and development departments are rendered useless by inefficient business cycle times, so businesses that reduce production cycle times can provide innovative solutions and meet earlier launch dates.
- Impact on Customer Satisfaction: Companies that sell to customers should reduce cycle times to achieve higher customer satisfaction. It allows them to form a positive rapport with the customers, providing them with high-quality and efficient products.
- Impact on Cost Reduction and Profitability: Manufacturing requires examining every step, process, and input to reduce costs and increase profit margins, resulting in lower product prices and increased sales. With an optimized manufacturing cycle, labor costs are reduced, and efficiency is enhanced. Reduced production cycle times are critical for increased productivity because a smooth assembly line can produce goods faster.
Examples of successful companies that have optimized their manufacturing cycle time
In this section, let's see how these businesses succeeded by optimizing manufacturing cycle time.
Toyota
Sakichi Toyoda developed the Toyota Production System (TPS) to eliminate waste from the manufacturing process. It is now recognized as a basic lean manufacturing technique. Toyota also used the Jidoka method to reduce defective products, Kaizen to pursue continuous improvement, and the Just-in-Time (JIT) model to control inventory levels and avoid overproduction.
Nike
Nike implemented continuous improvement practices in 2011 and created the Manufacturing Index to reduce communication issues, disposal, and lack of consistency. The index includes lean elements such as "just-in-time" delivery and a continual improvement mindset. JIT production is a simple inventory system that produces only when there is a demand for it, reducing waste and saving space.
Harley-Davidson
Harley-Davidson used Total Productive Maintenance (TPM) in conjunction with the 5S system and Standard Work to keep their techniques stable. They added lean tools such as Kaizen and Six Sigma to improve operations and problem-solve issues. They also implemented just-in-time inventory management and value stream mapping to boost productivity, shorten lead times, and cut transportation costs.
Challenges to Optimizing Manufacturing Cycle Time
Cycle time is an essential metric for businesses to track, but it can be difficult to determine correctly. There are a few obstacles to optimizing or calculating the manufacturing cycle time. Some of these challenges are discussed below:
- Balancing efficiency and quality
Instances of lower-quality products may emerge or certain products may increase the overall production time to manufacture a small batch.
- Addressing skill gaps and labor shortages
If the labor or the workers are not efficient or skilled enough, it can cause a slowdown in production.
- Dealing with unexpected disruptions and delays
The lack of an efficient system may cause the manufacturer to modify and enhance the product. This can lead to increased delivery time and chances of delays.
- Lost revenue
An unoptimized manufacturing cycle time leads to employing more resources and labor to make the corrections or conduct a smooth flow of operations, leading to decreased revenue and profits.
Enhance Manufacturing Cycle Time in Production With TranZact
Manufacturing cycle time measures how long it takes to turn raw materials into completed goods. It indicates a business's success and revenue and allows organizations to overcome competition, and maximize profitability. TranZact streamlines all the stages of manufacturing from inquiry to dispatch, reducing manufacturing cycle time and improving product quality. By providing advanced features such as manual stock reconciliation, finished goods testing, accounting integration, and more, TranZact cuts down on production delays and bottlenecks to save precious business time.
FAQs on Manufacturing Cycle Time
1. What is manufacturing lead time?
Manufacturing lead time is the time taken to create, manufacture, and deliver a product to the consumer.
2. Why is cycle time important for a business?
Cycle time is an important indicator of business success, as it helps manufacturing units to innovate, tackle production bottlenecks, meet customer expectations and ultimately outrun the competition, and retain top talented workers and employees.
3. What factors affect manufacturing cycle time?
Factors such as capacity, labor, manufacturing congestion, inventory, quality of product, and schedule and management affect manufacturing cycle time.
