Problems of managing lead time

1. Stock outs- It‘s impossible to build equipment or run production plant when you are missing the necessary parts. This is especially problematic if the parts are not commonly available as the lead time can be weeks or months.
2. Lead time variability- Sometimes lead time varies from vendor to vendor which may create inventory surplus and sometimes stock outs. Ordering excess inventory strains your cashflow and one effective strategy to eliminate variability is to consolidate a company‘s suppliers thus everything arrives at the same time.
3. Shipping delays- It is the most unpredictable issue that arises hence affecting lead time, shipment can be affected by raw material shortage or force majeure
4. Too many processes-When factory workers have to build every component of a finished assembly, it will take longer to complete a project.
5. Disorganized inventory-Inventory lacking proper records and poorly stored can be hard to administrate, this makes it hard to make effective decision on planning for lead time

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