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Cycle time and setup time: formulas and example

Cycle time is the actual processing time of a unit/operation; setup time runs from the last good unit of the previous batch to the first good unit of the new one. Reducing both lowers Lead Time and WIP and increases Throughput and OEE.

What the Metric Measures

Cycle Time reflects the speed of an operation/process, while setup time reflects non-productive losses between batches. Together they determine flexibility and the ability to work in smaller batches.

Calculation

  • Cycle Time = Net processing time / Number of good units
  • Cycle Time (flow) ≈ WIP / Throughput (Little's Law)
  • Takt Time = Available time / Demand; goal: Cycle ≤ Takt
  • Setup time = "Last good unit" → "First good unit" of the new batch
  • Setup loss/unit = Setup time / Batch size

Agree on start/finish points, the reference cycle, the first-N-parts policy, and the separation of internal/external steps (SMED).

Calculation example

A shift is 480 min, including 3 changeovers of 40 min each — 120 min, a quarter of the shift. In the remaining 360 min of net running time the line produced 900 items: cycle time = 360 / 900 = 0.4 min per item (24 seconds). Cutting changeovers to 20 min adds 60 min of running time — 150 more items per shift.

Data Sources

MES/SCADA/PLC, ERP/1C (standards/routings), quality systems (FPY), CMMS (downtime), video time studies/timing, IoT sensors, shift timesheets.

Interpretation

  • Cycle Time↑ — non-standard modes, tooling, minor stoppages, manual operations
  • Setup time↑ — many internal steps, no quick-change tooling, searching for materials
  • Use SMED, standard work, 5S, pre-kitting, and first-article inspection

Useful Breakdowns

  • Line / unit; shift / crew; operator
  • SKU / recipe / tool; changeover type
  • Internal vs external setup steps; P50/P90 Cycle Time
  • First X parts after start-up (stabilization)

Dashboard Visualizations

  • Trend of Cycle Time and Setup time by shift/line
  • Boxplots/Histograms of Cycle Time
  • Waterfall of changeover steps (before/after SMED)
  • Gantt of changeovers and start-ups
  • Scatter: Cycle Time vs start-up defects
  • Takt vs Cycle panel with breach alerts

How to Set Goals

Align Takt and Cycle targets with a buffer; for Setup, set "X min to the first good unit" and ≥Y% external steps. Plan SMED stages (−30/−50/−70%), start-up standards, and an SLA for preparing materials/tooling.

Common Mistakes

  • Confusing Cycle Time with Lead Time
  • Counting setup up to "start" instead of to the "first good unit"
  • Ignoring minor stoppages and the first defective parts
  • Comparing different SKUs without normalization
  • Unsynchronized calendars/time zones

Questions for Discussion

  • Which setup steps can be moved to external in the near term?
  • What is the effect of −30% setup on batch size, WIP, and Lead Time?
  • Where is the Cycle Time bottleneck, and what is the reference mode?
  • Does your Cycle match your Takt during peak periods?

Questions and answers

What is cycle time?

The average time between two consecutive units leaving a line or operation; calculated as net running time / number of units produced.

What is setup time?

The time to change equipment over from one product or batch to another — from the last good part of the old batch to the first good part of the new one.

How do you reduce setup time?

Apply SMED: prepare tools and materials before stopping, move some tasks to while the machine runs, and standardise fixtures and settings.