Lead Time vs Cycle Time

Lead time clock starts when the request is made and ends at delivery. Cycle time clock starts when work begins on the request and ends when the item is ready for delivery. Cycle time is a more mechanical measure of process capability. Lead time is what the customer sees.

Lead time depends on cycle time, but also depends on your willingness to keep a backlog, the customer’s patience, and the customer’s readiness for delivery.

Another way to think about it is: cycle time measures the completion rate, lead time measures the arrival rate. A producer has limited strategies to influence lead time. One is pricing (managing the arrival rate), another is managing cycle time (completing work faster/slower than the arrival rate).

Corey Ladas

If you want to learn more about where our fixation on Lead Times and Cycle Times comes from, then take a look at my new free book entitled Theories of Work: How We Design and Manage Work or go to the specific chapter in the book here.