Manufacturing lead time is the elapsed time from an agreed production trigger until goods complete the defined manufacturing stage. The start and finish events must be specified because suppliers may quote from deposit, material receipt, purchase-order confirmation or approved sample.
Which stages can be included?
- Order confirmation and engineering review
- Material procurement
- Tooling and setup
- Production and assembly
- In-process testing
- Final inspection and packing
How is total lead time built?
If material preparation takes 12 days, production 18 days, testing 4 days and packing 3 days, sequential manufacturing lead time is 12 + 18 + 4 + 3 = 37 calendar days, before freight.
Illustrative manufacturing lead-time plan
| Stage | Duration | Cumulative time |
|---|---|---|
| Material preparation | 12 days | 12 days |
| Production | 18 days | 30 days |
| Testing | 4 days | 34 days |
| Packing | 3 days | 37 days |
Parallel tasks, weekends, holidays, approval delays and capacity constraints can change the actual elapsed time.
Lead time vs. production cycle time
Cycle time measures the time to produce a unit or batch once the process is running. Lead time includes waiting and preparatory stages from the agreed trigger to completion.
What should a purchase order state?
Define the trigger, working or calendar days, approved sample dependency, quantity, capacity assumption, completion milestone, inspection window and consequence of buyer-caused delay.
