Reducing the Business Cycle (Manufacturing Lead Time) as a Competitive Strategy

Lean Production
Knowledge Center

 

Next Topic

Lean Production > Forum > Reducing the Business Cycle (Manufacturing Lead Time) as a Competitive Strategy

Reducing the Business Cycle (Manufacturing Lead Time) as a Competitive Strategy
Javier Elenes, Business Consultant, Mexico, Member
You can reduce the business cycle / Manufacturing Lead Time (MLT) as a competitive strategy doing what "In this Industry can't be done".
For example, you can give a 100% service (Yes 100% First Filling Rate).
As Managing Director of a bearings manufactures company where the service was 60% with a business cycle (MLT) of 120 days we developed a MFR (Manufacturing Fast Response) technology to reduce the cycle into 12 days better than the 45 - 25 days of similar US - Japan plants so our customer response time improved and the service level increased to become 99-100% - better than the best possible international level of 80%.
PS: The Plant Manager from the US (Our Technologist) said that was impossible.
 

 
Manufacturing Fast Response as a Competitive Strategy
Manven, Analyst, India, Member
I agree manufacturing fast response is a most effective tool to improve competitive edge. Benchmarking for such projects is a difficult task, as from the shop floor managers to the machine suppliers to the consultants - all keep some buffer to safeguard their success.
But if an organization wants to excel in service level, it has to surpass the previous benchmarks.
 

 
Reducing Manufacturing Lead Time in a Smart Way
ERNEST MILLER, CxO / Board, United States, Member
Reducing manufacturing lead time can be effective, especially if you can get it significantly inside the time of your competitors, but it must be done smartly so that costs are not increased dramatically.
You may be able to get a premium for superior delivery, but you have to choose: do you want to gain market share at current pricing using faster lead-time or do you want to increase margin and profitability by charging premiums for the improved service.
 

 
The Bigger Aim is Competitive Advantage
Jaap de Jonge, Editor, Netherlands
@ERNEST MILLER: Excellent point. Thanks for reminding us that we need to compare the benefits / gains from having a superior MLT with the cost and any further disadvantages of achieving such superior business cycle. Our aim is to achieve a (sustainable) competitive advantage. Reducing MLT can be a very good approach for that. For certain companies in certain markets in certain competitive situations.
 

     
Special Interest Group Leader

Interested? Sign up for free.


Lean Production
Summary
Forum
Best Practices


Lean Production
Knowledge Center

 

Next Topic



About 12manage | Advertising | Link to us / Cite us | Privacy | Suggestions | Terms of Service
2019 12manage - The Executive Fast Track. V15.1 - Last updated: 18-8-2019. All names of their owners.