Final answer:
Order fulfillment cycle time begins when a customer places an order and ends upon delivery. It measures the efficiency of a company's fulfillment process. By reducing this time, companies can improve customer satisfaction and inventory management.
Step-by-step explanation:
The student is asking about the order fulfillment cycle time, which is a key performance indicator in supply chain management and business operations. This metric is also known by several terms such as APICS definition, lead time (LT), or customer order cycle time. It begins when a customer places an order and ends when the order is fully delivered to the customer.
The order fulfillment cycle time approximates the total time taken for a company to complete an order. It's an important measure of efficiency, affecting customer satisfaction and the company's ability to handle inventory and production planning.
Using Richard's Furniture Company as an example, if deliveries occur between 10 a.m. and 2 p.m., the company is interested in understanding the duration past 10 a.m. that customers wait for their deliveries. This is to help optimize their delivery operations and reduce the total order fulfillment cycle time.