Throughput Time in Manufacturing Efficiency

Manufacturers that decrease throughput time increase efficiency in three areas:

·???????? Opportunity cost

·???????? Just-in-time delivery

·???????? Continuous improvement

Knowing the opportunity cost of a process helps managers understand potential opportunities to optimize their operations and increase output (Lemay, 2022). Knowing the value of this cost can answer the question: Can the resources needed in the process create better outputs if used elsewhere? The longer a task’s throughput time, the larger its opportunity cost. By decreasing throughput time, opportunity cost is made more transparent for managers. Understanding each process requires vast knowledge, so transparency is crucial to understanding the complexity of opportunity costs. So, sequentially, opportunity costs are improved after the throughput time is decreased.

??????????? Just-in-time delivery efficiency is directly correlated with throughput time. By adequately coordinating raw materials to be delivered as close to the time they are needed as possible, the complexity of logistics is reduced. If a product’s journey is begun in this manner, the throughput time will significantly decrease, which can create positive feedback loops. Positive feedback loops are beneficial in manufacturing because of the many steps required in the many processes. If the interactions between raw materials and the products they are made into are exhaustive and complicated, this pattern will continue and negatively affect every other sequential step. This is why correlating the delivery of raw materials is crucial in manufacturers’ endeavors to improve the output time. ?

A low throughput time creates a more simplistic system of continuous improvement. This allows managers to quickly see bottlenecks and understand the causes of inefficiencies, enabling a more efficient continuous improvement system over time (Lemay, 2022). A bottleneck must be central to a manager’s perspective of a problem because if they solve any problem that isn’t the most severe bottleneck first, the real bottleneck will worsen exponentially. Continuous improvement is a central focus of all manufacturing companies, and the correlation between their respective throughput time and improvement is almost always symbiotic.

In any manufacturing process, the throughput time is a measurement of efficiency. Decreasing it helps managers use opportunity costs to make better decisions, see better effects of just-in-time delivery, and develop a superior continuous improvement system.

References

Lemay, P. (2022). How To Reduce Throughput Time in Manufacturing. Retrieved from Tulip: https://tulip.co/blog/how-to-reduce-throughput-time-in-manufacturing/

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