how to reduce lead time
though an entire manufacturing and distribution process may be complex with many stages companies can take steps to reduce lead time and shorten the number of days for each process consider the following ways to reduce lead time types of lead timethere are three primary types of lead time each must be considered in conjunction with each other to set overall expectations of a manufacturing process therefore these three primary types often flow into a fourth type of aggregated lead time the customer lead time is the amount of time between when a customer places an order and when the customer receives the product this includes the time between when a customer places an online order and the company receives the order confirmation then it includes the entire manufacturing process shipping process and delivery process the material lead time is the amount of time between when a company becomes aware of a need for raw materials and when the materials are physically obtained companies are often alerted by inventory management systems when orders are processed this lead time may be influenced by information systems that notify management when current inventory levels are low it may also be impacted by ordering shipping delivery and fulfillment by suppliers once materials have been received the production lead time kicks off this is the amount of time between when a company has all necessary resources on hand to manufacture a product and when it completes the manufacturing process unlike other lead times this entire lead time should be internally manageable and depends on internal factors such as waste labor equipment efficiency ppe availability and machinery downtime lead times above may be aggregated to create a fourth lead time and companies may track different cumulative lead times for example a company may be interested in the internal lead time i e when raw materials are sourced to when the final product is manufactured though it may seem bureaucratic breaking lead time into the categories above helps a company identify the strong and weak points along the sale process factors that affect lead timeanalyzing the lead time formula for a manufacturing company the factors that affect lead time can be broken into three categories the procurement factors the manufacturing factors and the shipping factors procurement lead time factors all relate to the sourcing of raw materials for production well established companies with strong relationships with suppliers may be less impacted by these factors still when relying to external companies there is always the risk that lead time falters due to an external failure to deliver procurement lead time factors that increase lead time include manufacturing lead time factors are relatively all controllable for a company this internal only stage of the sale process means a company may change processes personnel or equipment to improve or worsen lead time as opposed to the other two lead time factors a company should have almost full discretion over the manufacturing lead time factors these factors that result in longer lead times include 