A company’s total business cycle time is measured from the time a customer’s need is identified to
receipt of payment from the customer for the finished product or service.
Most manufacturing companies focus on the time required to produce the product when they should be looking to simplify their internal support processes to eliminate waste and nonessential activities. The reality is that as much as 75% to 90% of existing activities in the support functions are non-value-added and can be eliminated. As an example, from one manufacturing client company demonstrates. The average customer delivery time was 32 days. However, when the time it took the average sales order to make its way through order entry was measured, it was found to be a whopping 10 days when the actual touch (processing) time was only 20 minutes.
Cycle time management extends beyond manufacturing into your support processes and yields benefits in other areas like marketing, human resources and finance. Once your people learn that up to 90% of their activities in their work area are non-value-added and expendable, they become open to a new operating philosophy—cycle time reduction. The benefit of focusing on internal support processes is that the change is relatively inexpensive and the operating savings relatively large.
Because cycle time management focuses on reducing time it helps you produce products or services of better quality at lower cost and with faster delivery. These results are essential if your organization is to remain competitive in the global marketplace.
Willie L. Carter is the president of Quantum Associates, Inc, a process improvement consultancy. He helps managers unlock the full promise, speed, and energy of their processes. Carter certifications include, Lean Sensei, ISO 9000 Lead Assessor, Manager of Quality/Organizational Excellence. He is an experienced facilitator, coach, and author of the book “Process Improvement for Administrative Departments, The Key to Achieving Internal Customer Satisfaction.” His company helps executives optimize their business processes to minimize their costs, accelerate their cycle time while simultaneously enabling them to do more with less. He can be reached at email@example.com