Value Stream Mapping

Management is Essential

The lean transformation should

provide:

Growth with improved margins

Growth with minimal capital
Growth without more employees

What are our main stumbling blocks?

Years of bad habits

Financial focus with limited cost
understanding
A lack of system thinking and incentives
Metrics supporting a legacy model
Limited customer focus
Absence of effective operating strategies

How have these stumbling blocks been

addressed?

Programs of the month (band aids)

Meetings, meetings, meetings, meetings

If we could just start over..with

Activities aligned with our business strategy

Efforts focused on NET improvements for the
company
Metrics supportive of fundamental change
Simple, constant communication of our plans
and achievements as an enterprise

Why not take the value stream

perspective?

Whenever there is a product (or

service) for a customer, there is a value
stream. The challenge lies in seeing it.

3 enterprise value streams:

Raw Materials to Customer Manufacturing

Concept to Launch Engineerin
Order to Cash - Administrative Functions

A Value Stream is the set of all actions (both

value added and non value added) required to
bring a specific product or service from raw
material through to the customer.

Value Stream Improvement vs.

Process Improvement
Value Stream

Process

Process

Process
Customer

Stamping

Raw
Material

Welding

Assembly
Cell

Finished
Product

Value Stream Mapping

Follow a product or service from

beginning to end, and draw a visual
representation of every process in the material
& information flow

Then, draw (using icons) a future state map

of how value should flow

Levels of a Value Stream

process level
Start Here

single plant
(door to door)

multiple plants
across companies

Value Stream Managers

Process 1

Process 2

Process 3
Customer

Kaizen

The Value
Stream Manager

Using the Value Stream Mapping Tool

Product/Service
Family

current state
drawing

Understanding how things

currently operate. Our Baseline!

future state
drawing

Designing a lean flow. Our vision!

plan and
implementation

The Goal of Mapping

Current State Mapping

Completed in a day
Performed by a cross functional team of
middle managers responsible for
implementing new ideas
Resulting in a picture (and team observations)
of what we see when following the product

Future State Mapping

Completed in a day with the same team

Focused on:
Creating a flexible, reactive system that
quickly adapts to changing customer needs
Eliminating waste
Creating flow
Producing on demand

Current State Value Stream Map

Future State Value Stream Map

Planning and Implementing

Dont Wait!
You need a plan!

Tie it to your business objectives

Make a VS Plan: What to do by when
Establish an appropriate review frequency
Conduct VS Reviews walking the flow

Remember the other two value streams?

Administrative activities are often a major

percentage of the total throughput time
Goal: 400% improvement in productivity over
10 years
Modest opportunities on the plant floor;
Untapped opportunities off the plant floor

Enterprise Perspective

Engineer to Order
Configure to Order
Capital equipment manufacturers
Small companies (<500 employees)
Service Firms

We might begin in

Processes directly impacting the part

production

Engineering
Quoting

Or, in value streams with direct customer

contact

Order entry
Invoicing

Value Stream Mapping

Helps you visualize more than the single

process level
Links the material and information flows
Provides a common language
Provides a blueprint for implementation
More useful than quantitative tools
Ties together lean concepts and techniques

Value Stream Management

The map is just a picture of ideas!

The fundamental change is in how we choose
to manage the value stream as an integrated
system of decisions and tasks

Value Stream Management

Use your strategic plan as a guide

Find the gaps in necessary performance
Improve value streams to meet the performance
Create new metrics to support new ways of thinking
and acting
Understand true product family costs
Manage operations by the value stream data
Always have a future state

Critical Success Factors

Management must understand, embrace, and

lead the organization into lean thinking
Value stream managers must be empowered
and enabled to manage implementations
Improvements must be planned in detail with
the cross functional Kaizen teams
Successes must be translated to the bottom
line and/or market share

Putting it to Work!

Continuously improving fundamentally flawed

processes will yield limited results.
Simply automating existing manual processes can
also yield limited results.
Seriously challenging old practices will provide
the dramatic results desired.