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What is the manufacturing cycle time? Formula and Calculation

Nguyễn Viết Lộc
EFEX

Manufacturing businesses now compete in a dynamic and highly competitive business environment. The supply chain undergoes changes, and depending on environmental variables, customer demand can fluctuate or even spike. A business must measure KPIs inside a production facility to ensure that it is accomplishing its goals and is adaptable enough to effectively satisfy customer demand. 

One of the most important KPIs in a production facility is manufacturing cycle time since it shows exactly how much time and money are being used to make each item.

What does Manufacturing Cycle Time mean?

Production companies use manufacturing cycle time as a significant performance metric. So, what is cycle time in manufacturing? The amount of time required to transform raw materials into completed items is known as the manufacturing cycle time, or throughput time 

The duration required to turn a customer order into a final product can be significantly reduced with a thorough investigation of this time period, which can provide a substantial competitive advantage. The four different categories of elapsed time that make up manufacturing cycle time are as follows: 

👉 Read More: What Is The Procurement Cycle? Process And Example 

Process Duration

This is the amount of time needed to work on turning raw resources into final items. Process time can be reduced by redesigning products.

Moving Time

This is the period needed to transfer orders from one workstation to another.  By placing workstations close together and using conveyors to move things continually, the moving time can be thus reduced.

Inspection Time

Inspection time is the amount of time needed to inspect a product to make sure it is free of flaws. There is no need for a separate inspection activity because inspections may be incorporated into the process of production.

Queue Time

Queue time is the amount of time a job must wait before being processed in front of a workstation. By reducing the overall volume of goods in work-in-process, it can be decreased. Calculating and monitoring the production cycle time can have significant commercial repercussions. A business can increase efficiency, focus on capacity consolidation, manage loss and logistical problems, and more by lowering manufacturing cycle time. 

Understanding the cycle time will significantly boost lean manufacturing by giving staff a useful benchmark for determining the completion of a final product. Business benefits from production cycles that move more quickly, provided the quality of the product is not sacrificed.

How to Calculate Manufacturing Cycle Time

There are several ways to compute the cycle time in manufacturing and it can be used for a variety of processes inside a production facility. 

For instance, equipment cycle time describes the amount of time required to process a product without taking any support procedures. The complete production process, involves the loading and unloading period, application changeovers per item, as well as processing time. This is referred to as the "effective cycle time." 

Every measurement matters and a manufacturing company may monitor the time it takes to complete a cycle from start to finish. In terms of formula, the production cycle time formula can be determined by combining productive hours and non-productive hours.

In theory

Manufacturing Cycle Time = Process Time + Move Time + Inspection Time + Queue Time

Manufacturing-cycle-time-formula
Manufacturing cycle time formula

 Where:

  • Productive hours = Inspection time + Process time
  • Non-productive hours = Queue time + Move time

In Reality

Accurately tracking all constituents at once is impossible. In order to determine cycle time, the quantity of products is multiplied by the run time needed to manufacture them.

Total Parts Manufactured/ Run Time = Cycle Time

How to Cut Down on Manufacturing Cycle Time

While reducing the production cycle time, setting priorities is crucial. It will be less bothersome to start with non-productive (or non-value-adding) operations initially, such as waiting and moving materials. Value-adding operations should be only improved after actions in non-value-adding operations have been exhausted since they have a tendency to carry an influence on continuity or quality.

How-to-Cut-Down-on-Manufacturing-Cycle-Time
How to Cut Down on Manufacturing Cycle Time

 Cutting the manufacturing cycle time is essential for improving customer experience and boosting an organization's income.

Reduce Waiting and Idle Time

Among the first aspects to be affected when cycle time is optimized is the accessibility of materials and resources to decrease idle time. Resource availability may be ensured by efficient MRP (or material requirements planning) connected with ERP & supply chain. Besides, the digitalization in MRP can instantly make needed data available and accessible, allowing quicker decisions.

Eliminate material movement

Reduced material transportation can be achieved by methodical planning and improved route cards. Reduced movement can influence cycle time by reducing the time required for such movement.

Cut down on inspection time

Inspections at the beginning and conclusion of a production line are essential for assuring product quality and minimizing waste. They take time, though, and don't really improve the result. Automation can assist or eliminate human intervention, which can be slowed down and worn out. Inspection time can be sped up via guided inspection using visual cues to make decision-making easier. Having the appropriate gauges and tools on hand may also drastically cut down on inspection time.

Reviewing the order profile

Customer satisfaction is strongly affected by cycle time efficiency. This is particularly relevant when producing items with substantial variances or nonstandard specifications. The key to minimizing cycle time is comprehending the essential elements of the scheduling and ordering tasks in series or in parallel while guaranteeing minimal material movement.

Cycle time Improvement using predictive analytics

Planning the ideal production cycle time may be accomplished by creating situations with predictive analytics. In order to make wise judgments about cycle time optimization projects, advanced analytics may also assist in identifying the effects of streamlining on outlier commodities and components

Manufacturing Cycle Time: Example

The duration spent on different tasks throughout ABC Company's operations was noted. The following details were taken from its files.

  • Wait time 2 days
  • Process time 15 days
  • Inspection time 1 day
  • Queue time 3 days
  • Move time 1 day

Manufacturing cycle time = 15 days + 1 days + 1 days + 3 days = 20 days 

The 20-day production cycle time. It indicates that, on average, 20 days pass between the commencement of production and the delivery of the finished product. The wait time is included in the delivery cycle time. 

The delivery cycle time in the given case is 22 days. From the time the firm receives a client order until the goods are sent, it typically takes 22 days. 

Making strategic choices requires careful consideration of the manufacturing and delivery cycle times. The stronger the firm is, the faster the manufacturing and delivery. The items' quality shouldn't, though, decline. Businesses do this by cutting back on or removing non-value-adding operations and redesigning their workflows to be more productive.

👉 Read More: What Is Activity-Based Costing? Example And Formula 

👉 Read More: What Is Tracking Signal? Calculation And Example 

👉 Read More: What Is Rough-Cut Capacity Planning And Example?

Conclusion

Have you already got the definition and calculation of manufacturing cycle time? We hope you find this post useful for your business to reduce manufacturing cycle time. Do not forget to follow our Fanpage and website to get many interesting articles!