Controlling Input: The Real Key to Shorter Lead Times.

Despite the failure of the U.S. to reap benefits associated with reduced lead times, manufacturers in the Far East, principally Japan, have enjoyed tremendous success at lead time reduction. Manufacturing lead time (MLT) is defined as the difference between when an order is released to the shop and when the order is available to the customer. It is apparent to manufacturing managers that shorter lead times are a must if a successful manufacturing position is to be maintained. A myriad of benefits, such as better due date performance with lower inventories, can be realized by shortening lead times. If the U.S. and European manufacturers wish to close the gap and regain their competitive levels, some form of controls over manufacturing lead times must be implemented. In any system, a necessary prerequisite to controlling lead times is that the rate of input to the shop must be equal to or less than the rate of output from the shop. Without an equal level of shop input and shop output, inventories necessarily increase and with it, MLT.