The Value Stream Map is a critical tool within the Lean methodology. It serves as the basis for documenting the “As Is” state of the process and is the platform for designing the “To Be” state of the new and improved process flow. A Value Stream Map (VSM) is a sequential order of process steps.
What’s In a Value Stream Map?
The map begins with the first step in the process, typically the step that triggers the process such as the customer giving an order or the receipt of the order or request from the customer. The process ends with the completion of the activity usually manifest in delivery of the customer order or delivery of the unit to the downstream process.
A Value Stream Map can incorporate an enterprise from receipt of a customer order to delivery of the product to the customer or comprise sub-processes within this larger, big picture context. For example, a continuous improvement process might be commissioned to examine the Underwriting process within insurance company. The beginning of the Value Stream Map might commence at receipt of the request for a policy by the underwriting group and end at the decision to issue or deny the policy. Ideally, every enterprise/company would want a Value Stream Map from end-to-end capturing the customer order to the final delivery of the product or service to the customer.
The “As Is” State
The initial Value Stream Map captures the current process as it exists. This is known as the “As Is.” It is the actual process flow and should be created through observation of the current flow and with participation of those who are in the process. Do not make the mistake of pulling a process map from the procedural manual (SOP). The best technique for mapping is to be the unit (the “thing”) coming through the process. For example, in the insurance industry it might be the policy. In the auto industry, it may be the car. In each instance, the Value Stream Map begins with the request for the unit i.e. insurance policy or car.
Let’s take the example of an outbound shipment of product from receipt of the request for the shipment to the delivery of that shipment to its intended location. This is a transaction business process controlled by the Transportation Group within the company. In this example, it just so happens the enterprise is a manufacturer. The Transportation Group begins the process of scheduling a truck for a shipment when it receives the ‘planned’ shipment from the Logistics Planning group. The process ends with the delivery of the shipment to the field distribution site.
There are a couple of things to take note of. First, identify the source of the process trigger. In this case, it’s the Distribution Planning group that plans the shipment which triggers the request for a truck. Next, follow the natural flow of the process and identify the process steps in sequential order as they occur. Process steps are (verb + noun) construction. For example, the first step in the process is “TMS receives the request”. (TMS is the Transportation Management System).
Value Adding and Non-Value Adding Steps
After identifying the process steps, note the amount of time each step takes. Cycle time (CT) is comprised of value added time and non-value added time. Value added work time is the actual work on the unit coming through the process that furthers the unit to its completion. Value added steps meet 3 criteria:
- The customer wants it done.
- The process step furthers the unit to its completion (hint: some type of transformation either physically or in conditionally such as the step to fund a mortgage request.)
- The step is done correctly the first time (rework is not value added).
Everything else is non-value added including the transportation and movement of the unit and the queuing of the unit between process steps. The data box beneath the cycle time analysis allows more process information such as yields of each step. You can amend the data box to capture whatever process information is meaningful. For example, for some process steps, it may be useful to capture changeover times.
After the process has been mapped and the cycle times and yields noted you can summarize the data in Total cycle time, total value added and non-value added time and overall yield. In this case, total cycle time is 55 hours or almost 3 days. The company may have an objective to achieve a next day delivery which would bring the total cycle time to 24 hours. The process efficiency is the value added time as a percent of the total cycle time, or 5%. If the process information is not known then the project team can dedicate some time to collect the needed information. Data collection is the topic of another article.
As the map is being created, opportunities and ideas for improvement will surface. It is important to share this activity with those involved in the process to capture all the possible opportunities.
Another important component of the map is the control of the process. The process and data control in this example is primarily system generated. Manual controls such as management generated labor schedules or manual interventions should be noted too.
Learn Where the Process Can Be Improved
As the map is being created, opportunities and ideas for improvement will surface. It is important to share this activity with those involved in the process to capture all the possible opportunities. Note the star like bursts of text information identifying where in the process the opportunity exits. Sharing the output of the mapping exercise and involving the organization in its creation builds a level of trust and ownership that is critical to continuous improvement efforts. Additionally, the visualization of the process in the mapping technique and its inherent data creates the impetuous for change.