Executive Briefings

To Better Meet Increased Demand, You Must Have Cycle-Time Reduction Program

In order to prepare for increased customer-driven demand, many small and mid-sized manufacturers are planning to increase capital spending and hiring in the coming year. But to maximize the benefits of staffing and investment growth decisions - and to ensure that operations can support spikes in demand as quickly as possible - CFOs and other financial executives should first consider implementing a comprehensive cycle-time reduction program.

Cycle-time reduction "” the process of compressing the time to perform manufacturing tasks "” can be a powerful tool to help manufacturers better align capacity with demand, reduce waste, improve order-to-cash cycle time, and improve customer satisfaction.

The first task for any cycle-time reduction program is to evaluate existing manufacturing processes and identify opportunities to remove non-value-added activities or improve productivity. Potential improvements can include a wide range of actions, such as changes in manufacturing techniques, adjustments to nominal staffing levels, or even the outsourcing of certain activities. Some of these options will undoubtedly require capital investment or product-design changes that can significantly affect an organization's liquidity, inventory balances, and borrowing costs.

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Keywords: supply chain, supply chain management, value chain, manufacturing processes, non-value-added activities in manufacturing

Cycle-time reduction "” the process of compressing the time to perform manufacturing tasks "” can be a powerful tool to help manufacturers better align capacity with demand, reduce waste, improve order-to-cash cycle time, and improve customer satisfaction.

The first task for any cycle-time reduction program is to evaluate existing manufacturing processes and identify opportunities to remove non-value-added activities or improve productivity. Potential improvements can include a wide range of actions, such as changes in manufacturing techniques, adjustments to nominal staffing levels, or even the outsourcing of certain activities. Some of these options will undoubtedly require capital investment or product-design changes that can significantly affect an organization's liquidity, inventory balances, and borrowing costs.

Read Full Article


Keywords: supply chain, supply chain management, value chain, manufacturing processes, non-value-added activities in manufacturing