Learn difference between Cycle Time calculation and Lead Time calculation. How to identify non value added activities and step by step approach to reduce cycle time and non value added activities.

What is Cycle Time

Cycle time is defined as the amount of time needed to complete a single task and to move it forward in the process. The cycle time may differ by task, but to make the line flow, all operations must be completed under the given Takt time.

Cycle time is also known as turnaround time for any given task, in many industries people are familiar with this term and use it rather than cycle time. An example of cycle time from service industry could be installation of internet connection at home. If the provider does it in 24 hrs, then the cycle time here would be 24 hrs.

Let us take another example(refer to image below), customer places and order of a particular product. The manufacturing process involves 3 tasks.

Task 1 took 4 days to complete and Task 2 took 5 days to complete. So, 4 days and 5 days are the cycle time for Task 1 and Task 2 respectively. Similarly the final Task took another 5 days to complete.

So, we can have different cycle times for different activities while they are part of a single process. However the total cycle time of the process would be 10 Days in our example.

What is the difference between Takt Time and Cycle Time?

Takt time is calculated based on customer demand or requirement, it is not based on actual time that it takes to complete the task. While Cycle time is calculated basis actual time to complete the task.

We always work on adjusting Cycle time keeping Takt time in mind. We work on Cycle time reduction not Takt time reduction.

Reducing Cycle time benefits in terms of improving productivity and reducing costs.

Why Cycle Time Reduction

As you can see cycle time and Lead Time calculation is independent of customer requirement, while takt time calculation is based on customer requirement.

In our business processes, we always try to reduce cycle time because it is directly linked to cost reduction and customer satisfaction. We take up projects to reduce cycle time for following reasons:

To please a customer: If we can deliver product or service before the customer expectation then obviously customer would be happy in most of the scenarios. It will set us apart from the competition.

If we can deliver product or service before the customer expectation then obviously customer would be happy in most of the scenarios. It will set us apart from the competition. To reduce waste: When we work on to reduce Non Value Adds (NVA), we can reengineer and redesign the process. It helps us to understand the process constraints better. As we start measuring NVAs, we can track and try to reduce it through different measures. It can be a process change or better training of staff. As we reduce NVA, cycle time reduces and benefits all stakeholders.

When we work on to reduce Non Value Adds (NVA), we can reengineer and redesign the process. It helps us to understand the process constraints better. As we start measuring NVAs, we can track and try to reduce it through different measures. It can be a process change or better training of staff. As we reduce NVA, cycle time reduces and benefits all stakeholders. To increase capacity and productivity: As we reduce cycle time, we can produce more with less resources being used. It decreases overall cost of operations.

As we reduce cycle time, we can produce more with less resources being used. It decreases overall cost of operations. To simplify the operations: When we study the process, we try to automate activities which can be automated and eliminate steps which are not required. This can be done as a Kaizen event or can be part of Value Stream Mapping.

When we study the process, we try to automate activities which can be automated and eliminate steps which are not required. This can be done as a Kaizen event or can be part of Value Stream Mapping. To remain competitive: To keep the costs low and customer happy, we have to keep the cycle time at the lowest and very competitive. Firms conduct benchmarking studies to compare their cycle times with competitors. Many top consulting firms provide these kind of benchmarking studies.

Cycle Time Reduction

Let us reconsider the below example again, it is a line of 5 stations and observed cycle time for each station.