How Can You Reduce Your Production Lead Time?

Production lead time and inventory levels behave in direct proportion to one another. Although it is difficult to shorten net production time, a large part of lead time consists of non-value-added time, i.e. stagnation, which can be positively influenced by the performance of Gemba management, production planning, changeover time, production lot size, flexibility of the production facilities, employee skills, ….

In the following I focus on 5 central issues:

No matter how many Lean activities you implement, without first optimizing the production order sequencing for each resource, lead time will not get any shorter. The goal is to optimally coordinate the sequencing with the timing for each process (neither too early nor too late). Because the quality of the sequencing directly affects the quality of process synchronization, realizing these two important goals minimizes stagnation time and helps achieve the shortest possible production lead time. Therefore, creating the best possible sequence plan should be considered one of the most important tasks in production planning.

The more complex a product, the more components and parts, and the greater the number of parallel, merging and branching processes required in their manufacturing. In such processes we usually find the most stagnation times. It is not possible to manually calculate an optimally coordinated sequence for the production of all the individual components. A powerful APS is essential, one that can automatically determine optimal sequencing, and thereby reduce stagnation times and the overall lead time.

Often planning tools are used in selected process areas. However, I observe time and again that optimization in micro-areas has little impact on reducing total lead time. These are two entirely different concepts. Optimizing total lead time, and thereby increasing efficiency, can only succeed when there is a central “conductor” that overlooks the value chain from a bird’s eye perspective and, with the use of optimal sequence planning, sets the takt for all processes and resources. To achieve this you need a high-performance, standout planning system, one designed especially for orchestrated, end-to-end planning.

Making lot size decisions depends on machine setup times and the flexibility of machines being used. Top Lean companies like Toyota don’t just use one-piece-flow, mixed-model production in the assembly but also in the production of high-grade products such as: cylinder blocks, gear housings, crankshafts, camshafts, electrics components, etc. The production takt is coordinated with the takt for pre- and final assembly, i.e. the finished components are sequenced to arrive at the right assembly line, at the right time (just-in-time).
One-piece flow production is only possible when systems are designed in such a way that the setup time is shorter than the respective production cycle time.
In the 1970s, Toyota introduced the SMED (Single Minute Exchange of Die) system, i.e. all changeover processes must be completed in under 10 minutes, even those for large pressing machines. In the 1990s the goal was raised to “Cycle Time Setup” which meant changeover time is shorter than the production cycle time, which enables one-piece-flow production.
Although implementing a one-piece-flow production in small and medium-sized production companies may not be easy, I think achieving SMED is a reachable goal for all manufacturers.

To conclude, here are my 4 recommendations for lead time reduction:

• Implement a high-performance APS which has the ability to automatically optimize sequence planning.

• Do everything you can to reduce system changeover times and lot sizes.

• Initiate or deepen the practice of Kaizen philosophy, especially at the management level, which means to question existing standards / methods and continuously improve.

• Kaizen / Gemba may not be the easiest way to go, but ultimately, it’s the only way to achieve long-term success.