Shorter Lead Time

Lead Time is directly correlated to Work In Process (WIP) Inventory. At the same output rate, a fifty percent reduction in WIP will cut Lead Time by 50%. A boot manufacturer, for example, can cut WIP 50% to cut the Lead Time of his special orders in half. Conversely, a jet engine repair facility may be able to cut lead time to free up an engine for use in generating cash flow.

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