I have seen different definitions for lead time and cycle time in the Agile and Kanban communities (for SW development).
From Lean manufacturing:
lead time is the time between the initiation and delivery of a work item.
cycle time is the time between two successive deliveries
In my opinion, this translates directly to Agile SW development like depicted in the photos below.
For a typical Agile development team the workflow is something like:
Backlog -> Ready for Dev -> In Dev -> Ready for Validation -> Validating -> To Be Deployed -> Deployed
Next is a sequence of photos from a card wall depicting these concepts. Please have in mind that I am only showing two stories for illustrative purpose.
lead time is the time between the initiation and delivery of a User Story; in our case it is the time a Story enters the Deployed stage minus the time the story has entered the Backlog stage. Story 34 has entered the Backlog in day 4, and enters the Deployed stage on day 11; lead time equals 7 days (day 11- day 4).
cycle time is the time between two successive deliveries; in our case it is the the time between two stories entering the last stage– Deployed stage in this case. 34 enters the Deployed stage on day 11, then two days after, the next story– Story 37–enters the Deployed stage; cycle time equals 2 days (day 13 – day 11).
These metrics should be collected for the set of Stories the team has delivered,. This way you can get the average lead time and average cycle time, two powerful process improvement metrics.
Varying the WIP limits on the workflow stages (assume the same set of Stories, and the same team members) will affect the average lead time and the average cycle time.
This is what the workshop I have been running is all about!
My hypothesis is that after people participate on the workshop they will have experienced the Little’s Law.
Little’s Law: Lead Time = Cycle Time x WIP
