CPIM Practice Exam

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Prepare for the CPIM Exam. Study with flashcards and multiple choice questions, each question has hints and explanations. Get ready for your exam!

Practice this question and more.

Which term describes the time needed to complete an order?

Lead time
Cycle time
Turnaround time
Processing time

The correct answer is: Lead time

The term that describes the time needed to complete an order is lead time. Lead time encompasses the entire duration from when an order is placed until it is delivered to the customer. This includes not only the processing and manufacturing stages, but also additional factors like order review, release for production, handling, and transportation. Understanding lead time is crucial in supply chain management because it directly affects customer satisfaction, inventory management, and overall supply chain efficiency. Shortening lead time can lead to increased competitiveness and better responsiveness to market demands. Cycle time, while related, refers to the total time it takes to produce a product from start to finish but does not specifically encompass the order completion process from a customer perspective. Turnaround time is often used in the context of service delivery or turnaround in operations, and processing time specifically refers to the time taken to complete the tasks involved in processing a single order, which is just one component of the overall lead time.