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Reducing Cycle Time Pays HUGE Dividends

People always dispute the various improvement methodologies, and what one they should deploy in their organization. Rather than sticking to one methodology I tend to focus on what outcome(s) I am seeking and select the right tool(s) to achieve the desired end result. Regardless if it’s Lean, Six Sigma, TQM, MBO, Theory of Constraints, it all comes down to continually improving your business each and every day.

Take one of my favorite Key Performance Indicators (KPI’s), Cycle Time. Focusing on this key metric can have a HUGE impact on many others throughout the value stream of your product or service. You’re going to see labor hours come down, less work-in-process, and improved quality and customer satisfaction. Why? Because you can’t reduce cycle time without fixing issues like rework, material and engineering issues, inadequate flow, and variability in the process.

Is there always a direct correlation? No, but often times there is. If you focus on driving down your cycle time, you’ll see positive improvements in your bottom-line.

Just as a benchmark you should target a 30-50% reduction. I have found that this isn’t as hard as one would first think. I have proven this to be possible in various industries, throughout the entire value stream.

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