Also called throughput time and flow time. Lead time is the total time for a product to move through a series of process steps. Lead times typically used are order-to-delivery, order-to-invoice, or door-to-door (i.e. goods in, to goods out). For a transactional process (e.g. software development) then lead time might be order-to-delivery of completed work. For a lead time, the specific start and stop points must be defined. Lead time consists of value-added time, non-value-added business essential time, and non-value-added time (pure waste). Lead time is proportional to inventory (Little’s Law). Compare Cycle Time which is different.
« Back to Glossary Index
« Back to Glossary Index