Throughput time is not a widely used word in Lean Six Sigma world.
‘Throughput’ is the number of items produced by a process in a given period of time. And ‘Cycle time’ is the average time required to produced one item by a process.
So if for Process A, cycle time is 10 mins per item.
Throughput of the process will be 6 items per hour.
Lead time is the time required to deliver final product to the client, i.e. time lag between initiation and completion of the request.
Assume, for A Process A, a request was raised on 20-Mar and product delivered to client on 22-Mar, the lead time is 2 days while the cycle time is only 10 mins, which means for rest of the time the request Is actually waiting in the queue for some reason/s. This gives you an opportunity for process improvement.
Another concept worth understanding is Takt time.
Takt time is the rate at which process should run in order to meet customer demand.
For example, on a particular day for Process A, the demand is 100 items.
Assuming 2 people working for 8 hours per day:
Total available time = 2*8 = 16 hours = 960 mins
Takt time = [Time available] / [ Number of units to be processed] = 16 hours / 100 items
= 9.6 mins per item
So with the current cycle time of 10 mins, you won’t be able to achieve demand. Hence the cycle time should always be less than takt time. Now, you can run another project to reduce process cycle time to 9.6 mins per item.
What is throughput time? Is it the same as lead time?