Understanding Lead Time
Determining lead time is an essential part of any manufacturing or scheduling process. For any product that you purchase or manufacture, you encounter a time lag between when you order or start it and when you receive or finish it. To account for the lag, you must estimate the extra time (lead time) and account for it in planning.
For JD Edwards EnterpriseOne DFM, the system calculates lead time based on the operations flagged as critical in the Critical Path field. If you do not use JD Edwards EnterpriseOne DFM and enter a routing in base manufacturing, a value of 1 is set in the Critical Path field for each operation.
Cumulative lead time is the total amount of time that is required to produce a product. JD Edwards EnterpriseOne Shop Floor Management uses the requested date of the order and calculates the appropriate order start date, based on the methods used to define the level lead time or lead time per unit for the product.
Many factors can influence the company's lead time policy, including:
Manufacturing environment (assemble-to-order, make-to-order).
Fixed or variable quantities.
Serial or overlap operations.
Fixed or variable time.
Number of shifts and operators.
Factoring by efficiency.
Protection.
Whether the company uses fixed or variable lead time depends on whether you have consistent work order quantities for a manufactured item. If the work order quantities vary significantly, you use variable lead time. A significant variation is any amount that requires more or less lead time. Items with short lead times can have larger fluctuations than items with long lead times. You specify fixed or variable lead time on the Additional System Information forms in the Item Master program (P4101) and the Item Branch/Plant program (P41026). The system calculates lead times for parent and component items based on this information combined with the work center information and routing instructions that are set up in JD Edwards EnterpriseOne Product Data Management. At any point in the planning and scheduling process, you can change lead time values manually.
The system subtracts fixed lead times directly from the requested date on the work request to calculate the start date of production. Fixed lead time remains the same, regardless of the quantity produced. However, variable lead time adjusts according to the quantity produced.
For any manufactured product, the system calculates four types of lead time:
Lead Time Type |
Description |
|---|---|
Level lead time |
The number of workdays required to complete the product after all items are available. |
Manufacturing lead time |
The total number of workdays required to complete a product, from its lowest-level components to the final item, assuming that all purchased items are in-house. |
Cumulative lead time |
The number of workdays required to acquire items and complete a product, from its lowest-level components to the final item. Cumulative lead time is the level lead time for a product plus the longest cumulative lead time of any of its components. |
Per unit lead time |
The sum of the run times, as defined by the prime load codes for the work centers, factored by the routing time basis and converted to the lead time per unit. You use this lead time calculation when the Fixed/Variable option in the Item Master and the Item Branch/Plant programs is set to variable lead time. |
The JD Edwards EnterpriseOne Shop Floor Management system uses specific information to calculate lead times:
Serial or overlap operations.
Fixed or variable lead time indicator.
Routing labor, setup, queue, move, and machine run hours.
Work center prime load code.
Number of employees or machines per work center.
Hours per work day.