How to Measure Cycle Time: A Comprehensive Guide

A project’s success is dependent on the ability to practice effective time management. When you calculate cycle time, you can gauge productivity on a task-by-task basis to save time, money, and resources.   

In this guide, we’ll explore: 

• The basics of cycle time
• The cycle time formula and related metrics like Takt and lead time
• Best practices for using cycle times

Table of contents

• What is cycle time
  • Formula
  • Example
• Related terms
  • Takt time
  • Lead time
• Cycle time best practices
• Frequently asked questions

What is cycle time

Cycle time is a critical metric in the manufacturing process that, when optimized through process improvements, can significantly enhance productivity and efficiency.

Cycle time is the time it takes to complete a task from start to finish. It’s crucial to explore this metric to optimize project management, supply chain best practices, and more.

While simple in theory, this metric is a crucial indicator of your team’s productivity and overall performance. This is more than just a measure of output and raw materials. Finding your actual cycle time can be a game changer and help you track time spent on tasks and labor costs. Let’s take a look at the formula.   

Formula

Cycle time = Net production time ÷ Number of Units Produced.

Example

If a graphic design agency takes 40 hours a week to produce 50 designs, its production rate is one design per 0.8 hours. That converts to one design per 48 minutes. Therefore, the cycle time for designs at that agency is 48 minutes.

Related terms

While many project managers use cycle time, lead time, and takt time interchangeably, there are important distinctions between them. These three terms measure output and predict productivity, but it’s important to understand the key differences. 

Takt time 

Managers use Takt time (or simply Takt) to identify the rate at which they need to complete deliverables to meet customer demand.

Formula 

Takt time = Production time ÷ Number of products required (demand)

Example

If a factory operates 8 hours (480 minutes) daily and the customer demand is 240 units daily, the factory’s takt time is two minutes. 

Lead time

Lead time refers to the total time between a customer’s order and the time it takes to fill. Ideally, the goal is to limit the delay time between order placement and fulfillment. 

Formula 

Lead time = Products complete ÷ order received.

Example

If it takes a candle shop three days to fill an order and two days to ship a product, their lead time would be five days.

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Cycle time best practices

Once you’ve calculated your cycle time, it is vital to maintain or decrease it to keep your production rate steady. Here are some ideas for improving productivity and reducing CT.

• Break projects into smaller, more manageable segments and track those segments to determine where bottlenecks frequently occur. 
• Reduce downtime with more deliberate project assignments and scheduling.
• Reduce your total CT by optimizing your team’s functionality and tracking the average time it takes to complete tasks.
• Use your CT calculation to incentivize high performers and set goals for your team. 

Adopt an Agile methodology and use an Agile project management tool to increase efficiency.

Frequently Asked Questions

What is the difference between cycle time, lead time, and takt time?

• Cycle time tracks the time a team needs to make a product. 
• Lead time calculates the time between when customers order a product and when they fill the order. 
• Takt time determines how frequently a business has to complete deliverables in order to meet customer or client demand.

How can I track cycle time? 

You can use a time tracking platform or project management solution to track your cycle time and help with calculating cycle time. 

Combining time tracking, in-depth reports, and project management functions like Kanban boards and scheduling ensures more accurate cycle tracking.   

Why does cycle time tracking matter? 

Whether you work in software development, supply chain management, or a creative field, you can improve your entire process by tracking and reducing your cycle time.

Short intervals help you increase efficiency, show continuous improvement in your bottom line, and build better rapport with your customers. With this guide, we hope you’ll have the tools to succeed across the board.

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