The main objective of lean system is to augment effectiveness and efficiency of various processes in the organization by reducing waste in operations like long lead times, defects and bottlenecks in material and information flows. One tool that can be used is through ‘Value Stream Mapping’. Value stream mapping provides a visual representation of the flow of materials and information throughout the organization. It helps to identify, demonstrate, reduce waste and finally create effective flow through all the processes in the manufacturing organization.
Value stream mapping constitutes all the value added as well as non- added values required to make the product. It consists of the process flows starting from the raw materials to make the product finally available in the hands of the customers.
What Does Value Stream Mapping Do?
Value stream mapping is used to:
- Graphically illustrate the flows of materials and information in a process. It displays the interaction between multiple organizational functions- both manufacturing as well as ancillary functions.
- Pinpoint the problem areas, inefficiencies, defects, bottlenecks more efficiently as it integrates and maps the information flows, material flows along with the sequence of tasks. It even shows the cycle- times and lag- times between different tasks.
- Involves all the stakeholders in each stage of the process and hence, it becomes easy to develop and implement countermeasures to facilitate cultural change in the organization. It provides a proper presentation of all the limiting factors.
- Continuous improvement is facilitated since the direction can be focused on lean transformation teams, front line supervision and upper management.
How to Make and Use a Value Stream Map
Step- 1: Understanding the current state
The very first step is to select the product or product family, decide on the goal of improvement and train the team for value stream mapping. A cross- functional team should be selected and include all the stakeholders involved in the process. Once the team is selected, the physical path of the material flow should be walked through. It is necessary that all the primary as well as secondary materials flow required for the manufacturing process should be mapped. While walking through all the material flow paths, observe and document all the communication points carefully. This will help to prepare the current state value stream map.
Identify the start and endpoints of your process.
In the end your process owner or project sponsor is the final rule on when a process begins and ends but in a value stream analysis this is typically from the moment a customer makes a request to the moment when they receive the product. Arguments could be made for capturing the whole process by including things like transaction settlement (funds clear an account, restocking or retooling takes place, all “technical debt” is completed, etc.)
Draw the process flow.
Map your process including sub steps. It’s helpful to trace the flow of one unit (product or service) going through the process.
Note areas that require inputs or outputs. Does that alter your diagram? Did you miss a step. Be sure to include those interactions with external teams.
Include metrics for each process step.
What measures you take depend on what kind of project you are doing. What you can afford to measure? Some processes are trickier or more expensive to measure than others. Even with unlimited resources the spread and center of your process distribution might affect the measures you need – perhaps an average is OK in a normal distribution case but in another you might want to measure the median.
Before measuring you may want to validate your measuring systems first / auditors to ensure their accuracy with a repeatability and reproducibility study. Gathering this data can be time-consuming; best to get it right to the level of precision required the first time. No matter what you measure you might want to test your measurement tools
What are the bounds of the case? The lower bound, or fastest time might be the ‘happy path.’ The upper bound, or slowest time, might be the worst-case scenario.
- What is the average time – or most likely time?
- What is the median time?
- Is there any changeover or prep time required?
- What’s the uptime?
- What resources are used in this step?
- Manpower – how many people, how many shifts.
- What are the machine capabilities?
- What is the throughput of this step? How much is delivered?
- How much inventory stacks up?
Step-2: Analyze and reflect
In this step, analyze the current state value stream map with all the stakeholders in order to gain consensus on the current performance of the process. Next, the limiting factors, deficiencies, defects and bottlenecks should be identified in the current process. The performance and cost of each limiting factor should be quantified. It is also important to identify the root causes and not the symptoms of the limitations of the current state value stream map. Based on the root causes of the limitations, cost effective solutions should be developed. Finally, the current state value stream map should be amended to reflect the proposed solutions and changes in eliminating the limitations of the process. The amended value stream map is now called as the ‘future state value stream map’.
Look at value being delivered and waste incurred.
- Note any of the wastes including, but not limited to, wait time, rework time, retooling, and down time.
- Note any process steps that are unnecessary or not valuable.
How to tell if a step is valuable or not?
- Call out the value-added activities.
- Is it done right the first time, every time?
- Is the customer is willing to pay for it?
- Has the process object has physically changed?
Calculate Touch Time / Cycle Time
The time a product (physical or completed service) takes to complete the entire process to churn out one piece of the product.
The total time physically spent on a process. This is different than the overall time it takes to complete a process step or task in a stream from start to finish because the waste is not built in.
This is heavily dependent upon defining your starting point and your end points. A SIPOC can help you identify these. In the end, the process owner (or the project sponsor) are the final rule on when a process begins and ends.
Cycle Time Examples:
Sales: An example cycle time could be from when a prospect first makes contact with your company and ending when they complete a purchase.
Hospital: An example could be from when the patient enters the ER to when they are discharged.
Step- 3: Improve
How can we cut out, remove, or avoid those wastes we identified? What are the bottlenecks in our process? What step in the process stream has the slowest throughput or cycle time? Is there a way to make that more efficient?
Before implementing the future state value stream map, socialize and gain consensus from all the stakeholders involved. Then, the changes need to be implemented and in that process, the affected procedures, bills of materials and training materials should be modified. Training should be imparted to the staff based on the new procedures and requirements. Finally, the implementation of the changes should be facilitated on a descending priority basis.
Optimize the Whole.
The point isn’t to achieve a high score for any individual process step but to rather get a service complete or produce a product for a customer quicker utilizing less resources while maintaining excellent quality.
Step- 4: Sustain
The implemented changes should be verified and validated through establishing and measuring performance and cost related parameters using effective key performance indicators. The new standard procedures should be monitored and reinforced on a continuous basis.
Value Stream Videos
This video is put out from Minitab software. It’s a great tool, but even if you don’t have it, you can get a sense of what a value stream is and the insight it gives you by watching this video. Skip to 0:50 to avoid the marketing.
A great introduction from Gemba Academy
A great practical example from Gemba Academy
ASQ Six Sigma Green Belt Value Stream Questions
Question: In order for value flow analysis to be effective, a team must take which of the following steps first?
(A) Define the value stream
(B) Eliminate backlogs in the value stream
(C) Identify overlapping functions in the value stream
(D) Identify specific work practices within the value stream
Answer: (A) Define the value stream. This includes a starting point and an ending point of the process. You cannot do any of the other answers until you have mapped the value stream.