Lead time planning

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K.Chitra 11TM03

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A '''lead time''' is the interval that elapses between the recognition that an order should be placed and the delivery of that order.

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COMPONENTS OF LEAD TIME

The

amount of time that is needed for recognition of the fact that it is time to reorder. interval for doing whatever clerical work is needed to prepare the order. This includes determining how much to order and from whom to order. or telephone intervals for communicating with the supplier and placing the order. 5/14/12

The

Mail

 How

long will it take for the suppliers organization to react to the placement of an order. time includes lading, transit and unloading times. of delivered items by the receiving department and determining storage locations.
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Delivery

Processing

 Inspection Record

to be sure that items match specifications is generally required keeping computer time is needed to enter items in the warehouse stock records. of these lead time components add together to form the total lead time.

All

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Lead time for production:

A typical product development cycle of a garment industry consists of the following steps: Designing Marketing Purchasing/production. One has to compare lead-time of garment, taking into consideration the abovementioned procedure in both Unit C and Unit M. The observed time required for each stage of procedure, details of the 5/14/12

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EXPEDITING TO CONTROL LEAD TIME

Expediting is the process of keeping track of the state of an order. It includes reminding and following up with any one who could be delaying order processing. Expediting can be considered managements attention to decrease delays. Expeditors are accountable for making certain that due dates are met. Often , there are many dates and places to be tracked. Expeditors also are trained to prevent and remedy problem. Delays are addressed as to causes and corrections. Using information systems to track and evaluate situations , the expeditors know how to take action and when to use special capabilities to speed things up.
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Quick response manufacturing

QRM emphasizes the beneficial effect of reducing internal and external lead times. Shorter lead times improve quality, reduce cost eliminate non-value-added waste within the organization while simultaneously increasing the organizations competitiveness and market share by serving customers better and faster.
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 Time-based

competition is a broadbased competitive strategy emphasizing time as the major factor for achieving and maintaining a sustainable competitive advantage. seeks to compress the time required to propose, develop, manufacture, market and deliver products
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It

 QRM

advocates a companywide focus on short lead times that include quick response to demand for existing products as well as new product and design changes. combination has led to the implementation of QRM in many highmix, low-volume companies
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This

PLANNING LEAD TIME

From

the time-based perspective of QRM, the high degree of labour specialization and hierarchical department structures at purely costbased organizations have negative effects on lead times:

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 Products

and product orders require long routes through numerous departments communication structures involving various management levels require a significant amount of time to resolve even routine issues on efficiency and resource utilization encourages workers and managers to build backlogs, slowing the 5/14/12

Hierarchical

Focus

 Trying

to minimize costly machine setups, managers and workers resort to running large batch sizes. Large batch sizes result in long run times, leaving other jobs waiting and increasing lead times large product quantities to stock leads to high inventory, often prone to inventory obsolescence when stored products have to be discarded because
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Making

 All

these factors contribute to long lead times, ultimately resulting in waste throughout the enterprise such as excessive forecasting, planning, scheduling, expediting, work in progress (WIP), finished goods costs and obsolescence. These increase the overall costs and lower the organizations competitiveness
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 QRM

suggests that an enterprisewide focus on reducing lead times will result in improvements in both quality and cost. the time-consuming and often self-reinforcing practices described above can lead to large cost savings while improving product quality and customer responsiveness.
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Eliminating

 Hence,

on a management level, QRM advocates a mindset change from costbased to time-based thinking, making short lead times the yardstick for organizational success.

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 REFERENCE: PRODUCTION

AND OPERATIONS MANAGEMENT Martin K. Starr, PhD

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THANKYOU

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