What is Value Stream Mapping and Why do you need a Value Stream Map?
What is a Value Stream Map?
A value stream map, commonly abbreviated VSM is one of the many lean enterprise tools available. What a Value Stream Map does is, it illustrates the current or future state unit cost for a given process.
It takes a look and analyses the various steps within the flow of the given process and it determine how good or service is transformed into something the customer is willing pay for. What the customer is willing to pay for is defined as value and the value stream value will also document for us the value added and non value added activities with the objective that all the waste, all that non-value added activities are removed from a given process.
Principles of Value Stream Mapping
Value Stream Mapping is a diagnostic tool which reveals the symptoms of larger problems in your process.
It helps to identify and priortiize oppurtunities for improvement in your process and come out with an implementation plan which will help you do so.
Its a macro level visual representation of the information flow as well as people and material flow in a process. Each Process block in VSM represents a break in the timeline.
How to Apply a Value Stream Map?
To get started with value stream mapping, the first thing we need to do is define our stream. The stream is going to be the range between your start and finish points. If you’re in manufacturing, this typically is from a supplier or customer where suppliers are going to be providing materials that are transformed into a good that the customers will ultimately want so the starting would be that the suppliers providing the materials and the end would be the customer receiving the final product.
In a Service based organisation, these streams usually look from customer to customer as there is no physical good being produced rather our start point will be where the customers engage as an organisation and the end would be the customer receives the service they were expecting and although there is no mandatory start and finish to a given stream.
Once the customer demand is defined, map the basic production process. The mapping should begin with the customer demand and should be mapped by conducting a walkthrough to obtain high level process information. It’s always good to start the early the process as you can – all the way to the end of the process you can. The reason why is because the unit cost value wont be as accurate if you’re missing steps along the way. After the stream is defined, the next step is collecting data and this data is going to be focused on specific metrics.
These data that is being collected include
- Cycle time (time taken to make one product)
- Change over time (from last good piece to next)
- Up-time (on-demand machine utilization)
- Number of operators
- Shifts worked
- Net available working time
- Scrap rate
- Pack size/pallet sizes
- Batch Size
Identifying wastes and Metrics
lean focus methodology looks at a series of wastes. Although we are not going to be going through all those waste types here, at the higher level some of them are looking at transportation. This could be the physical transportation of good from one location to another or it could transportation of mail or it could be transportation of raw materials. It could also be transportation of materials that are in the process of being transformed.
That’s just one of the waste types we could look at but let’s look at the other metrics in value stream maps. The resources refers to your human capital, it also refers to operators with in your value stream map. This is the number of resources that are assigned to a given process. We also have transport time, which is the amount of time spent transforming that good or service into something the customers are willing to pay for. Delay time is a metric which could be also called by few other names such as inventory time also refers to non-value added activities where there is a weight between one step to another and quality is another metric we look at as part of value stream map.
Based on these metrics, wastes are identified and also improvement opportunities. We typically do this using a shape called Kaizen Burst.