Lead Time (sometimes also referred to as Order Lead Time) is the total elapsed time from order entry to customer delivery. It can be measured by imaginary riding the order from start to finish.

Practitioner’s Tip: Lead Time is what the customer experiences. Short Lead Times can be the result of fast production processes of having on stack what the customer has ordered. Often, when customers are not happy with the delivered performance (Lead Time), inventories are built up as a buffer. As you remember from the different Types of Waste, this is of course not in the spirit of a Lean process. Making processes Lean means shortening Lead Times without increasing inventory levels.

Measurement

Lead Time = Time from order to delivery

Learn more about this topic in our Lean Metrics Online Course.

Synonyms:
Order Lead Time