What is the impact of lead time variability?

• A. Shorter production cycles.
• B. Lower safety stock requirements.
• C. Increased safety stock and uncertainty.
• D. Faster order fulfillment.

Answer: (C)

Lead time variability creates uncertainty about when inventory will arrive. To maintain a desired service level despite that uncertainty, planners raise the safety stock—the extra inventory kept as a buffer. The more variable the lead time, the larger the range of possible arrival times and the greater the need to cover potential demand during those varying periods. This combination leads to increased safety stock and overall uncertainty in planning. Shorter production cycles would reduce lead time, not result from variability; lower safety stock would be inconsistent with needing a larger buffer; and faster order fulfillment isn’t guaranteed—in fact, variability often makes timeliness harder to achieve.