Polish company Netwise S.A. joins the collana Group
Home / Polish company Netwise S.A. joins the collana Group The
Paul M.
13 August 2026
Companies in the production and manufacturing sectors know that there are more factors contributing to success than just quality. Time, for example, also has an impact on efficiency, competitiveness, costs, logistics, customer satisfaction and other aspects.
A key performance indicator in this context is therefore lead time. What exactly does this time period refer to? Why does this indicator play a crucial role in both manufacturing and logistics, and why should you not neglect to measure it? In this article, you will find an overview of the topic and answers to these questions.
Throughput time is a key performance indicator in production processes and in warehousing. According to the original definition, throughput time refers to the time taken to complete a product from start to finish. In other words, throughput time measures the production process of the manufacturing order.
It has its origins in manufacturing. However, other sectors are now also making use of it for process optimisation (e.g. in the service sector or in warehouse processes).
However, this is not simply a single period of production. Instead, various stages of the process play a role here: from receipt and preparation, through to execution and completion.
production planning
Let’s take a closer look at which components count towards lead time within the context of an order:
Companies should never lose sight of lead times. Long lead times, for example, tie up a large amount of capital, can reduce customer satisfaction, increase storage costs and even lead to bottlenecks.
A short lead time, on the other hand, offers many advantages. It can reduce a company’s costs (e.g. lower capital tie-up costs), increase customer satisfaction, speed up the supply chain and improve competitiveness. Further benefits include increased productivity and flexibility, enabling companies to respond more quickly to new market conditions.
To calculate the lead time, you can use one of the following formulas:
|
Lead time = order delivery date – order receipt date |
|
Lead time = set-up time + processing time + dwell time + transport time + storage time + additional time |
A real-life example illustrates the lead time involved in manufacturing a shelf:
|
Step in the process |
Time component |
Time required |
|
Adjusting the machine to a specific sawing width and fitting the saw blades. |
Preparation time |
10 minutes |
|
Cutting the individual wooden planks to size |
Processing time |
30 minutes |
|
Onward transport to the next machine |
Transit time |
5 minutes |
|
Grinding and drilling the holes for the screws |
Processing time |
15 minutes |
|
Onward transport to the next machine |
Transit time |
5 minutes |
|
Painting the boards |
Processing time |
10 minutes |
|
Drying the boards |
Dwell time |
12 hours |
|
Screwing the boards together to form a shelf |
Processing time |
30 minutes |
|
Quality control |
Extra time |
5 minutes |
|
Storage until dispatch |
Shelf life |
2 days
|
|
|
Total lead time |
2 days, 13 hours, 50 minutes |
Optimising or reducing lead times brings companies a host of benefits. However, to improve them, you should not only be familiar with the figures, but also focus on the right measures.
This includes taking a close look at your production control processes. This will enable you to identify weaknesses and compare the processing times for individual items. An ERP system provides all the necessary data for this and also enables real-time monitoring, so that you can react quickly.
To optimise production, you can also use more efficient and high-performance machines. These can carry out work processes more quickly, automate manual processes or perform several steps simultaneously. In practical terms, this means you can reduce both processing time and transport time.
You should not neglect your staff’s professional development either. Training can help them improve individual work processes, achieve greater productivity and identify opportunities for process improvement. It also helps to prevent errors and disruptions that can increase lead times.
Would you like to improve your lead times? diva now can help you do just that! The ERP system can provide you with real-time data on various time points, statuses, components and items. Gain complete transparency, identify areas for process improvement and benefit from reports and analyses.
By implementing an ERP system such as collana diva now However, there are even more benefits: reduce your costs and gain a competitive edge. Bottlenecks are a thing of the past, and customer satisfaction can only go one way: up! By integrating with other systems, you can also optimise your stock management.
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