Manufacturing throughput time definition
/What is Manufacturing Throughput Time?
Manufacturing throughput time is the amount of time required for a product to pass through a manufacturing process, thereby being converted from raw materials into finished goods. The concept also applies to the processing of raw materials into a component or sub-assembly. The time required for something to pass through a manufacturing process covers the entire period from when it first enters manufacturing until it exits manufacturing - which includes the following time intervals:
Processing time. This is the time spent transforming raw materials into finished goods.
Inspection time. This is the time spent inspecting raw materials, work-in-process, and finished goods, possibly at multiple stages of the production process.
Move time. This is the time required to move items into and out of the manufacturing area, as well as between workstations within the production area.
Queue time. This is the time spent waiting prior to the processing, inspection, and move activities.
The concept of manufacturing throughput time is primarily oriented toward the reduction of time required by the manufacturing process, so that you can increase the amount of throughput flowing through your system and thereby increase profitability. Throughput is net sales minus totally variable expenses. The bulk of the time spent in manufacturing tends not to be in processing, but rather in the inspection, move, and queue times noted above. Thus, it is easiest to reduce manufacturing throughput time by eliminating as much inspection, move, and queue time as possible.
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How to Use Manufacturing Throughput Time
The focus of a manufacturing throughput time analysis should be on the bottleneck activity in your production process. Compressing the throughput time in this one area allows you to increase the number of units being processed through it. The resulting benefit is that the throughput being generated by the bottleneck area goes up, resulting in more profits for your business.
Example of Manufacturing Throughput Time
The production manager of ABC International wants to calculate the manufacturing throughput time for its blue one-armed widget. He learns that processing time is three hours, inspection time is a half-hour, move time is one hour, and queue time is 12 hours. Thus, the total manufacturing throughput time for the blue one-armed widget product is 16.5 hours. Further, the production manager has a golden opportunity to reduce the throughput time, since the amount of queue time is nearly three-quarters of the total throughput time, and can probably be reduced without too much trouble.
Problems with Manufacturing Throughput Time
Here are some problems with the manufacturing throughput time concept:
Ignores bottlenecks. Throughput time does not identify or address bottlenecks in the production process, which can significantly limit overall efficiency. Focusing solely on total time might overlook critical delays at specific stages.
Does not reflect value-added time. Throughput time includes non-value-added activities, such as wait and move times, without distinguishing them from value-added processes like actual manufacturing. This can obscure areas for improvement.
Overemphasis on speed. Reducing throughput time might lead to rushed production, sacrificing quality for speed. This focus can result in increased defects and rework, ultimately harming efficiency.
Inventory build-up risk. Minimizing throughput time without synchronizing other parts of the supply chain can lead to excess work-in-progress (WIP) inventory, increasing storage costs and waste.
Ignores external factors. Throughput time typically considers only internal manufacturing processes and may overlook delays due to supplier issues, transportation, or demand fluctuations.
Complexity in measurement. Accurately tracking all components of throughput time—processing, inspection, move, and wait times—can be complex and resource-intensive, leading to potential inaccuracies.
Limited insight for strategic decisions. Focusing narrowly on throughput time might not provide sufficient information for broader decisions like capacity expansion, equipment investment, or product mix optimization.
By recognizing these limitations, manufacturers can adopt a more holistic approach, integrating throughput time analysis with other performance metrics for better decision-making.
Terms Similar to Manufacturing Throughput Time
Manufacturing throughput time is also known as production throughput time or throughput time.