What is Value Added Time?

Value added time is the time spent that improves the outcome of a process. This is typically just the processing time associated with production. All of the other intervals associated with a process, such as wait time and queue time, contribute nothing to the outcome and so are considered non-value added time. This concept is used to identify non-value added activities and eliminate them from a process, so that the total time required to complete the process is reduced. When the duration of the production process has been shrunken in this manner, it can be a competitive advantage, since a business can respond more quickly to customer demands.

It may be possible to compress the amount of value added time in a process. However, it is usually easier to first eliminate or reduce non-value added time, since it comprises such a large part of the total processing time.

Example of Value Added Time

Here are several examples of value added time, in different business environments:

Field support value added time. In a field support business, value added time would be the time spent at a customer location, repairing a person’s appliance. Repair work directly resulting in the appliance being returned to a workable condition would be value added. Conversely, any time spent having the customer fill out a survey form is not value added, since it wastes the customer’s time and does not contribute to the repair of the appliance.
Production value added time. In a production line, value added time would be the time spent assembling products as they move along a conveyor belt. Conversely, any time spent by production workers filling out production reports, taking breaks, or attending training classes is not value added, since it does nothing to create more products.