Process Cycle efficiency(PCE) = VAT/(VAT+NVAT) *100

VAT + NVAT = Total Lead Time

PCE<0.01% (mostly ) but Toyota operates at 37% PCE

A B C
CT=30s CT=25s CT=25s
Raw Material 4000 WIP 2000 WIP 1500 Finished Goods-500
Lead Time -12 days Lead Time -4 Lead Time -16 Lead Time -8 days
12/4 = 3 days FG 4/2 = 2 days FG 16/2 = 8 days FG 8 days FG

PCE =[ (30+25+25)/(30+25+25+21*24*60*60)] * 100 = 0.0044%

2 RM -> 1 WIP
2WIP->1 FG
4 RM->1FG
1. Given
Yearly Demand = 12000 pieces
RM (invt.)= 5000
WIP = 3000
FG= 2000
1 RM=1 WIP=1FG

Daily demand = 12000/12*30 = 100/3

Total inventory = 10000
No. of days for which invt will last = 10000x3/100=300 days

2. 1500 pieces half yearly

RM = 100
WIP= 0
FG= 200
1 RM = 4 WIP
1WIP=4 FG

Total inventory = 16x100 +200=1800

Daily demand = 1500/30*6 =50/6
No. of days inventory will last = [1800/50] *6= 216 days
TAKT Time = Available time (in min)/Demand(in It is the time that the customer is expecting it to deliver
units or batches) [Note : The numerator and 1 piece or Avg. Permissible time
denominator to be in same time horizon]

Cycle Supply
Time
Supply
Lean chain
Takt Demand
time