Typically, the lead time is significantly longer than the actual time to produce the product or service, often times 10-20X longer than the cycle time (only 5-10% of the lead time is spent working on the order, the rest of the time it sits or gets moved around the facility). For example, if your process is 5 steps, and each step takes one hour to complete, it is not surprising that it can take 50 hours or longer to process an order through the system (5 hours of cycle time x 10 = 50 hours).
One of the first improvements you can make to your process is to reduce the time spent BETWEEN the process steps, in order to reduce the amount of delays and excess transportation in the process.
This can be measured by using a distance measuring wheel to follow the flow of products or people through the process, or measured by AutoCAD or tape measure. The total distance traveled can be calculated before and after the improvements to determine time savings.
According to the book Making Materials Flow, each step of walking is equivalent to 2.5 feet. Each step (2.5 ft) is equivalent to 0.6 secs. If you use the metric system, one step equates to 0.762 meters. Said another way, for every 4.166 feet traveled (1.27 meters), one second of time is wasted.
Therefore, if your process distance traveled is 10,000 feet per day, let’s look at the calculations:
Next, you can multiply your labor rate x the number of hours of travel. For example, if the labor rate is $30 per hour (including all benefits), then $30 x 0.67 hours = $20 of wasted time per day. If you work 20 days per month, then the cost is $400 per month wasted due to travel.
Any other calculations you’ve used to capture walking distance savings?