Cycle Time
Reduction
Gulay Litchfield
For CQI-TECH PLC
Introduction
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Many companies waste thousands of pounds on
unnecessary procedures and processes that add
no value to operations and slow response times.
Customers are five times more likely to switch to
another supplier because of poor service than
because of poor quality or lower price.
Cycle Time Reduction, a technique to reengineer
business and production processes for speed
and maximum company performance, is critical
maximising profit.
Cycle Time Reduction provides specific, proven
techniques that are absolutely guaranteed to cut
costs and dramatically improve the overall
company efficiency.
Some Important Facts
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Statistics consistently show at least a 40 to 1
return on every pound invested in cycle time
reduction
Cycle time reduction can reduce overhead by as
much as 50%
As many as 75% of the steps in each business
process are non-value added
New product development can be reduced from
over two years to under one year (and
sometimes much less) with significantly fewer
resource
Response to special customer requests can be
reduced from 3 months turn-around to a mere 3
weeks or less
Outlines
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Definition of ‘Cycle Time’
Definition and Methodology of ‘Cycle
Time Reduction’ as a Management Tool
Advantages
Critical Success Factors
Key Stages
Success Stories
Conclusion
References
Definition of Cycle Time
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Cycle time is defined as the total
time for a unit to go from raw
materials to finished goods and is
a key performance measure in an
industry with short product lives
and rapid price erosion.
Definition of Cycle Time
Reduction
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Cycle Time Reduction is a management
tool used for fundamentally redesigning
the way work processes are carried out
to ensure they meet the needs of clients
in the most efficient and effective manner
possible
Methodology
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Fundamentally redesign the
Process
Effectively meet client’s needs
Efficiently meet client’s needs
Review key activities in value chain
crossovers
Reduce conception to delivery lead
times
Main Application Areas
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New Product Development
Use of cross-sectional teams to shrink the time
required taking a product from conception to
market
Operations
Cycle Time Reduction minimises complexity,
streamlines processes and decreases run
lengths.
Delivery and Logistics
Eliminating unnecessary work and speeding up
decision-making can decrease the time required
to fill the orders.
Advantages of Cycle
Time Reduction
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Increase productivity and employee effectiveness
Increase profit margins by lowering production
costs
Eliminate bottlenecks,identify and protect the
CCR, and reduce inventory.
Effectively meet changing customer needs
through shortened product development cycles
Supports more product changes over a shorter
period of time
What This Means
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Cycle Time Reduction will
give a company a major
competitive advantage in
terms of improved costs,
quality, service and
customer satisfaction
Critical Requirements
for Success
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General recognition and acceptance of
the ‘NEED’ by management and staff
Senior Management’s commitment to
change
Empowerment of team participants
Commitment to implementation
Appropriate representation of key staff in
team
Consultation at all stages
Key Stages 1
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Preparation
Identification of the CCR (Capacity Constraint
Resource)
Obtaining the support of senior management
Quality office co-ordination and assistance
Identification of appropriate team members
Briefing participants, supplying documentation,
setting venue
Identifying ‘ how we do things now’
Identifying the way the process currently
operates
Identifying current problems and concerns,
consultation!
Key Stages 1
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Preparation continued…
Identifying ‘how we should be doing things’
Identifying the possibilities for fundamentally
changing the process
Creating a new process
Identifying the actions required for implementing
the new process
Assigning the responsibility
Assigning a Team Leader for the next phase
(Implementation and Evaluation)
Key Stages 2
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Implementation and
Evaluation
Regular assessment of action plan
progress
Reassessment of priorities when
necessary
Reporting tangible improvements
Evaluating the redesigned process
A few success stories
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Using cycle time reduction techniques, IBM Brazil
eliminated 50 unnecessary procedures, 450 different
forms and 2.5 million documents a year
A major computer chip company estimated a 30%
increase in productivity with a savings of over $60
million.
A major aerospace firm provided the same volume of
product in 1992 as in 1991, while at the same time
accelerating throughput and improving on-time delivery
with one less shift, no increase in standard hours, and
$800,000 less overtime.
An expense report process at a major U.S.
manufacturing plant went from 3 weeks to I day and
required 5 fewer people.
Conclusion
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Cycle Time Reduction isn't just the
latest management technique. It's
a proven strategy to reengineer
your core business processes
through SPEED, eliminating waste
and maintaining maximum
efficiency (productivity) and
effectiveness (quality).
References
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Achievement Dynamics
Curtin University of Technology
Brunel University
The Goal (Goldratt 1992)
Domaschkle, Brown, Robinson and Leibl
Bain & Company Management Tools
John Stark.com
I Holland Ltd - Implementing The Goal