Cornerstone 15-2
Calculating Manufacturing Cycle Efficiency (MCE), page 762
The time that it takes to manufacture a product is influenced by many factors. Some of
the factors are meaningful and productive, while others are non-productive and result in
wasting valuable time. The Manufacturing Cycle Efficiency (MCE) measures how
productive the company is being in its manufacturing process.
If a manufacturing operation is experiencing the following activities:
Units produced per hour:
Move time:
Inspection time:
Rework time:
100 units (actual velocity)
20 minutes
15 minutes
10 minutes
We can calculate the MCE by first determining the actual production time for the output
of 100 units. The is calculated by taking the time of each of the activities away from the
60 minutes in each hour. In this case, the actual production time is 15 minutes,
calculated as 60 − 20 − 15 − 10 = 15.
The production time (15 minutes) divided by the sum of the time it takes to produce
the goods (15 + 20 + 15 + 10) or 15/60 is the MCE. In this case it is 0.25. This means
that only 25% of the time spent on the manufacturing process is actually productive
time, 75% is waste.
By changing the activities that are non-productive, we can substantially improve the
Manufacturing Cycle Efficiency. This is often the focus of consultants who are hired to
re-engineer a company’s internal processes.
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