lead time

(noun)

The amount of time between the initiation of some process and its completion, e.g. the time required to manufacture or procure a product; the time required before something can be provided or delivered.

Related Terms

Examples of lead time in the following topics:

  • Inventory Management

    • Inventory management addresses a number of concerns, including: replenishment lead time; carrying costs of inventory; asset management; inventory forecasting; inventory valuation; inventory visibility; future inventory price forecasting; physical inventory; available physical space for inventory; quality management; replenishment; returns and defective goods; and demand forecasting.
    • Time: The time lag in the supply chain from supplier to user requires the availability of a certain amount of inventory for use during this lead time.
    • In practice, inventory is maintained for consumption during variations in lead time, and lead time itself can be addressed by ordering a specified number of days in advance.
    • Economies of scale: To deliver one unit of product at a time, and in response to the specific need and location of a given user, would be costly and logistically difficult.

  • Inventory Management

    • The firm's work in process includes those materials from the time of release to the work floor until they become complete and ready for sale to wholesale or retail customers.
    • Time: The time lags present in the supply chain, from supplier to user at every stage, requires that you maintain certain amounts of inventory to use in this lead time.
    • However, in practice, inventory is to be maintained for consumption during variations in lead time.
    • Lead time itself can be addressed by ordering that many days in advance.
    • Balancing these competing requirements leads to optimal inventory levels, which is an on-going process as the business needs to react to the wider environment.

  • Purchasing Inventory

    • The scope of inventory management also involves stock replenishment lead time, carrying costs of inventory, asset management, inventory forecasting, inventory valuation, inventory visibility, future inventory price forecasting, physical inventory, available physical space for inventory, quality management, returns and defective goods, and demand forecasting .
    • Time: The time lags present in the supply chain, from supplier to user at every stage, require that businesses maintain certain amounts of inventory to use in this lead time.
    • Consumption: Inventory is to be maintained for consumption during variations in lead time.
    • Lead time itself can be addressed by ordering a specified number of days in advance.
    • From time to time, an organization will "shop" for suppliers through the process of bidding.

  • Other factors affecting supply chain management

    • Greater distances create longer lead times and higher transportation costs.
    • Cultural differences, time zones, and exchange rates make communication and decision-making more difficult.

  • Demand-pull production system and quick setups to reduce lot sizes

    • The traditional approach to manufacturing management promotes a strong focus on machine and labor utilization.The view was that if managers make sure that workers and machines are always busy, then surely the factory will be productive and efficient.This approach is called the "push" system of manufacturing, where raw material and work-in-process is continuously pushed through the factory in the pursuit of high utilization.The problem with this approach is that it usually produces high levels of inventories, long lead times, overtime costs, high levels of potential rework, and workers who are competing with one another rather than working cooperatively.
    • In contrast to the push system, JIT espouses a "demand-pull" system that operates on the rule that work should flow to a work center only if that work center needs more work.If a work center is already occupied with work activity, the upstream work center should stop production until the downstream work center communicates a need for more material.The emphasis on maintaining high utilization is removed in a JIT environment.The focus of a JIT environment is on addressing the challenges that affect the overall effectiveness of the factory (setup time reduction, quality improvement, enhanced production techniques, waste elimination, etc. ) in meeting its strategic goals, rather than allowing excess inventory to cover up inefficiencies that reduce the factory's competitiveness.
    • These items would consequently cause high levels of inventory costs, long lead times, high potential rework, low flexibility in responding to customer needs, etc.
    • Driving down setup costs and setup times are key to dramatically improving factory competitiveness in a JIT environment.

  • Why employees fear change

    • This can lead to employees wanting excessive details and other procrastination techniques (i.e. paralysis by analysis).
    • No time to adjust.
    • It takes time for new skills to develop.
    • Rushing through the change process can lead to disruption, sabotage, foot-dragging and/or poor performance.

  • Getting the Most Out of Your Time

    • In the years leading up to World War I, German U-boats rendered transatlantic travel and commerce a death-defying proposition.
    • The stress of being rushed all the time can make them frantic, prevent them from attaining good decisions, and even lead them into physical decline.
    • In reality, we can speed up more efficiently (and, thereby, get more done in a given time interval) by spending less time in contact with each key.
    • Check your e-mail no more than 2-3 times a day, and schedule those times in advance rather than just letting the spirit (or an electronic signal) move you.
    • One cannot do both at the same time."

  • Minimizing Risk of Miscommunication

    • Lack of Trust: Competition between employees and managers leads to a lack of trust.
    • Message overload can result when a person receives too many messages at the same time.
    • In business, a miscommunication can lead to costly errors or deadly mistakes.
    • Lack of trust: Competition between employees and managers leads to a lack of trust.
    • When creating the message, read the draft several times and look for confusing statements or awkward wording.

  • Economic Indicators

    • The leading business cycle dating committee in the United States of America is the National Bureau of Economic Research (private).
    • If unemployed workers have remained out of work for a long time, we may infer that the economy has been slow.
    • If such a leading indicator rises, the economy is likely to expand in the coming year.
    • To predict where the economy is headed, we obviously must examine several leading indicators.
    • To get an idea of what leading economic indicators are telling us about the state of the economy today, go to the "Business" section of the CNN Money website (CNNMoney.com), and click first on "Economy" and then on "Leading Indicators."

  • Hidden poisons

    • Moreover, the average PC consumes ten times its weight in hazardous chemicals and fossil fuelsto complete its production (in India and China alone, about 70% of arsenic, lead, cadmium, chromium, cobalt, mercury and other heavy-metal pollutants come from electronic waste created just by computer manufacturers).