What is Takt Time?
Takt time represents the rhythm or beat at which a product must be completed to meet customer demand within the available production time. It is calculated as:
Takt Time = Net Available Production Time ÷ Customer Demand
To dive deeper into what takt time is, read our blog post: What is Takt Time.
Understanding Available Production Time
The numerator of the formula - Net Available Production Time - considers the total time available for production, excluding planned and unplanned downtime. Here’s how to break it down:
1. All Time
This refers to the total operational time, including downtime. While it might seem counterintuitive to include downtime, this ensures the formula reflects real-world production constraints. Why is downtime included? Downtime, such as equipment maintenance or employee breaks, directly impacts the time available to produce goods. Including it provides a realistic calculation.
2. Planned Stop Time
This includes scheduled downtime for tasks such as:
• Maintenance
• Changeovers
• Machine setups
These periods are excluded from available production time since they’re not dedicated to producing output.
3. Non-Operational Time
This refers to non-scheduled stops, such as breaks, shift handovers, or meetings. These activities, while essential, don’t contribute to production and must be accounted for when calculating net production time.
Understanding Customer Demand
The denominator - Customer Demand - represents the number of units your customers need within a specific time frame. However, this can vary depending on your production strategy. Let’s explore the options:
1. Producing Below Average Demand
Pros:
• Avoids overproduction and minimizes storage costs.
• Reduces the risk of surplus inventory during low-demand periods.
Cons:
• Limits revenue potential.
• May fail to meet sudden spikes in demand.
Best Conditions:
• Economic downturns with reduced market activity.
• Industries with predictable, low fluctuations in demand.
2. Producing to Meet Average Demand
Pros:
• Balances production with market demand, reducing waste.
• Ensures steady resource utilization.
Cons:
• May not adapt quickly to significant demand changes.
Best Conditions:
• Stable markets with consistent customer needs.
• Industries with moderate competition.
3. Producing Above Average Demand
Pros:
• Provides a buffer for unexpected demand spikes.
• Strengthens market competitiveness.
Cons:
• Increases inventory and storage costs.
• Risk of overproduction during low-demand periods.
Best Conditions:
• High-growth markets with fluctuating customer needs.
• Industries where competitive advantage depends on availability.
What is the Takt Time Formula?
The takt time formula has been traditionally used in manufacturing to align production capacity with customer demand, minimizing waste in the process. By determining the optimal pace of production, businesses can streamline workflows, improve efficiency, and enhance customer satisfaction.
Example
If your factory operates for 450 minutes per day and your daily customer demand is 50 units:
Takt Time = 450 minutes ÷ 50 units = 9 minutes per unit.
This means each unit must be completed in 9 minutes to meet customer expectations without overproducing or overburdening resources.
Conclusion Key Takeaways:
• Definition: Takt time ensures production aligns with customer demand.
• Formula: Calculate takt time as Net Available Production Time ÷ Customer Demand.
• Production Strategies: Tailor your approach to meet, exceed, or stay below average demand based on market conditions.
• Practical Use: Use takt time to streamline processes, reduce waste, and improve efficiency.
Ready to take the next step? Explore our Tactplan tools to optimize your production scheduling and improve your bottom line. Please reach out to our team
Frequently Asked Questions
Q: Can takt time be used outside of manufacturing?
A: Yes, industries like healthcare and construction use takt time principles to synchronize workflows with demand.
Q: How do I adjust takt time for seasonal demand fluctuations?
A: Recalculate takt time regularly based on updated production times and customer demands.
Q: What’s the difference between takt time and cycle time?
A: Takt time focuses on meeting demand, while cycle time measures how long it takes to complete one production unit.
