Lead time is the total time from an order or item starting in the process until it is finished and delivered — including all waiting and inventory time. It differs from process time, which is only the time actively worked on the item.
The ratio between process time and lead time (flow efficiency) is often shocking: minutes or hours of work take weeks to get through the system, because the item waits in queues and buffers 95% of the time.
Little’s law gives the relationship: lead time = work in progress (WIP) ÷ throughput. To halve lead time without increasing capacity, you must halve WIP.