How do you apply takt time to a service industry?
As you know, takt time is the available time divided by customer demand. You never know the exact customer demand until the day is over; therefore, the takt time value is always an estimate that you would like to satisfy. History can help you get a fairly good handle on your customer demand estimate or you can use other sophisticated forecasting means to come up with a good estimate. For example, based on history you can estimate that on the Fourth of July you will need more attendants at fueling stations since more people would be on the road. Then based on the estimate of customer demand and your known lead-time to satisfy a customer, you can figure out how many attendants will be needed.
Talking about cycle times and lead-times, you are right in using the lead-times for satisfying a customer rather than the cycle time for applying the concept of takt time for services.
Sometimes, the way times are defined can cause confusion. The cycle time of a process can be the lead-time for the process, especially in services. This is because we define cycle time as the time needed for one iteration of the process to be completed and the lead-time as the time from the point of customer need generation to satisfying the need. One is based on the process, the other is based on the customer.
Unless these are the same or close to the same for services, you can have upset customers. This is because customers usually wait in front of the provider for their service, so if the cycle time for the performance of the process is not the same as the lead-time for the process, the customer will be upset viewing the wasted time. For example, if a plumber is fixing a broken pipe, the cycle time he or she needs to complete the process for the customer better be the lead-time that the customer is ready to wait for from the point the plumber arrives in the house to the moment the job is done.
Merwan Mehta, Ph.D.