Key Points
- Process time is used for measuring how long it takes for a step of the development stage to be completed.
- Cycle time is the total time it takes for something to be completed.
- You’ll use both measures together when developing a new process.
- The only true difference between these measurements comes down to scope and scale.
Process time vs. cycle time is a discussion that comes up often for newcomers to Six Sigma. Understanding these principles and how they apply to your time management is vital. Failing to grasp these concepts can affect your bottom line negatively.
What is Process Time?
Process time describes the interval required for a product or service to progress through a specific development stage. The exact scope of a “development stage” depends on the context. In industry or manufacturing, each stage is usually confined to a particular physical location with a workstation and equipment.
Understanding and improving process time is a core feature of Six Sigma management practices. Process times are directly related to throughput and profitability, so they are something businesses should always try to improve.
The Benefits of Process Time
Calculating and assessing process time in your operations is fundamental for sound business management. This is baseline information that leaders need to have before they can start making meaningful changes to company procedures. The main benefit of process time is the ability to divide and conquer through incremental and continuous improvement. Breaking things down into individual processes helps leaders find clarity and context.
How to Calculate Process Time
Process time is the total time between the start and end of a particular development stage. This means that the term includes both value-added (VA) and non-value-added (NVA) time. One of the first goals of lean management practices is to examine all NVA time in individual processes and find ways to reduce it.
What Is Cycle Time?
Cycle time is a big-picture concept. It describes the total time it takes for a product or service to reach completion. Typically, the timer begins the moment a customer finalizes an order. It ends when the customer accepts the final deliverable. There are several other management terms, including Takt time and lead time, that are often used in error to describe cycle time.
The Benefits of Cycle Time
Your cycle is the engine of your business. It’s the core and center of all your operations. The cycle is how you deliver value to customers and earn profit. That’s why businesses need to know their cycle time and take action to improve it whenever possible.
Improving cycle time has several benefits. The first is customer satisfaction and reputation. Satisfying customers on time or ahead of schedule means they are more likely to come back or recommend the company to others. Improving cycle time can also have substantial implications for profitability. Cutting even small amounts of waste in each cycle can be big news for your bottom line.
How to Calculate Cycle Time
There are two ways to calculate cycle time and it’s a good idea to use both if you can to ensure accurate results. The first method is to calculate the average cycle time by taking the number of units produced in a specific period and dividing that by the time required. This is a quick and easy way to assess cycle time for large quantities, which is particularly useful in mass manufacturing environments.
The second method is about tracking individual units through the process. Tagging or following specific units through every single process to completion can provide more accurate and detailed data, but is much harder to do on a larger scale.
Process Time vs. Cycle Time: What’s the Difference?
The only difference between process time and cycle time is scope. Process time is focused on specific tasks or development stages. It’s a more granular approach to operational analysis. In contrast, cycle time is all about the big picture. It’s the sum of all the process time added together plus any extra waiting or delays, like transportation or an approval process.
When Should You Use Process Time and Cycle Time?
Both of these concepts should be used simultaneously as part of any Six Sigma practice or lean management program. Companies need to know these numbers and should also have plenty of data to indicate the major factors influencing their times. Any business leader should make it a priority to get this information, learn from it, and use it to make effective decisions moving forward.
As we’ve emphasized in many articles, Six Sigma methodology is data-driven. As such, understanding how long it takes to complete something is one of the most important pieces of data you can receive. You could say much of the decision-making that springs forward in process improvement hinges on having these data points readily available.
Choosing Between Process Time and Cycle Time: Real-World Scenarios
A computer parts maker wants to cut costs across their operations by finding non-value-added (NVA) delays in their manufacturing. Due to the large diversity of its products and the sheer size of its operations, the company decided to start by examining the cycle time of each product so it could start with the ones that take the longest.
After calculating the cycle time of all their products, company leaders decide to improve operations revolving around processors and motherboards. This leads to an analysis of process time for each of these parts as the analysis team passes through each workstation where the parts go through a new development stage like cutting, assembly, testing, and packaging.
Other Great Tools for Managing Your Processes
We’ve discussed process time vs. cycle time, and how these measurements relate. However, we haven’t looked at flow time vs. cycle time. Understanding how these factor together is also equally important as the points we’ve previously discussed.
Having control of your data is also a great skill to have. As such, understanding the differences between categorical and continuous data can help supercharge your data analysis. When you adhere to a methodology driven by data, understanding how to best harness it can see net gains across the board.
Timing Is Everything
For businesses, time is money. Process and cycle time can make a difference between a healthy, agile company and a total flop. That’s why leaders need to know about these concepts and how to use them to make key decisions about their company’s future.
