Takt time, cycle time, lead time – what’s the difference, and where do you begin?

Takt time, cycle time, lead time – what’s the difference, and where do you begin?

‘Takt’ is the German word for ‘pulse’. And, if you add the German word for ‘time’ after it (‘zeit’), it translates literally as ‘clock time. Takt time is about staying on track, but it’s more than that: It’s about moving things forward. It’s the beat of a business and it prevents issues like waste, overstock, and disappointed customers.

The concept takes its bearings from 1930s Germany, where it was used in the airplane manufacturing industry. Two decades later, it propelled Toyota — then a small Japanese carmaker — into the giant it is today.

What is takt time?

Takt time is the speed at which you need to make a product to meet customer demand. Understanding and managing your takt time (your sell rate and your capacity) means optimizing production in the best possible way.

When it comes to producing things—whether that’s car parts or sandwiches, you need to get the numbers right. Make too many, and you’ll have waste. Don’t make enough, and you’ll have unhappy customers.

Takt time “…attempts to synchronize processes so that there are no delays or build-up of excess inventories in terms of scheduling. In terms of productivity, it seeks to maximize the productivity of the employee so that no seconds are wasted during the day,” concludes Art Smalley, an author, and lean management expert.

With takt time, you can:

  • Ensure you have a continuous flow of work
  • Meet customer demand
  • Avoid waste due to overproduction and/or over storage

Takt time formula:

The formula for takt time is your available production time, divided by customer demand.

To get the most accurate result, remember to only include the time people will actually be working. So, remove lunch hours, breaks, and shift changeovers. Also, keep each time frame relatively small (days or months rather than quarters or years).

To use a real-world example: say the sandwich shop is open five days a week, for 10 hours a day, with one-hour lunch break and two 15-minute breaks. The shop sells an average of 1,000 sandwiches a week.

To work out the takt time, we need to break the working time in a day (8 hours and 30 minutes) into minutes. This gives us 510 minutes in a day, which is 2,550 minutes a week. If we divide 2,550 by 1,000, we get 2.55 — meaning, the takt time to create a sandwich is two minutes and 55 seconds required for each order. The takt time = 2.55.

Once you know your takt time, you know how to manage your team so they’ll be able to meet demand.

Cycle Time vs Lead Time vs Takt Time: what’s the difference?

There are similarities between the three, but they are distinct differences.

Lead time: This is how much time you have to complete a task or activity without it impacting the following activities. In a production scenario, it’s the time between an order being placed, and the customer receiving it.

Cycle time: This is the time it takes to complete the production of one unit, from start to finish. In a production setup, this refers to the time it takes your team to work on that order.

Takt time: this is the maximum time needed to fulfill the order to meet demand.

How does takt time fit into lean management?

Lean ways of working focus on a ‘pull’ system of working, rather than pushing tasks through. This means that jobs are accepted by those working on them when they’re ready—and only then. The benefit of this is that it means organizations are producing something only when there’s a demand for it. The result is less waste—but only if your pull system is managed correctly, with a steady flow of work. Defining your takt time can help you do this.

How to enforce takt time

Once you’ve calculated your takt time, you’ll need to make sure your team knows the expectations you have of them.

Explain what it is, and why it’s important—ideally both in writing and via a team meeting to give people the opportunity to raise questions or concerns. Change can be a tricky thing to implement in an organization, so if your proposed takt time is a drastic move away from the current state of things, you may want to design and implement a change management process to get everyone on-board and make the transition as smooth as possible.

Next, ensure you have the right tools in place to keep things moving on time. For those working in offices, project management software should be your go-to: it allows you to see every project and task at-a-glance, making it easier to keep on top of progress. With Backlog, our own project management tool, you can set up automatic notifications that alert both project managers and team members when something requires their attention—helping everyone stay on track.

Final thoughts

Takt time is a lean management essential, and a must for getting the most out of your team. It’s also a must for those who want to reduce waste, limit the number of items left in inventory—and ensure they have what they need to meet customer demands. It’s also a good way to eliminate waste through inconsistency (Mura) and achieve a continuous improvement culture in your team. Pair this with collaboration tools to help the job run more smoothly, and your organization will soon be running like clockwork.

Georgina Guthrie Georgina is a displaced Brit currently working in France as a freelance copywriter. Before moving to sunnier climates, she worked as a B2B agency writer in Bristol, England, which is also where she was born. In her spare time, she enjoys old films and cooking (badly).