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Chapter 5: Charting the Course: Using Value Stream Maps
While conducting the analysis of the current state, mark up a copy of the
Current-State VSM. If you’re using the low-tech, pencil-and-paper method, use
a different color to indicate where in the value stream the opportunities for
improvement exist.
Putting your ear to the street
When analyzing the Current-State VSM, start with the customer — always
start with the customer. What are your customers saying about you? Listen
closely and carefully — and objectively — to what your customers say. As
you hear the feedback, examine the issues and identify where they occur in
the value stream. For example, are your customers complaining about not
getting your product when they want it? Look at the critical path to delivery.
Are they complaining about not getting the right mix of product? Examine the
material flow and information flow. Are they concerned about the quality of
your product? Study the design and manufacturing processes. If you’re lucky
and your customers are all singing your praises, you may need to make room
for new business.
An effective tool for analyzing potential causes of customer issues is the
Ishikawa Diagram, also know as the Cause-and-Effect or Fishbone Diagram.
With this tool, you can identify where in the value stream the issues origi-
nate. Figure 5-1 shows an example of an Ishikawa Diagram illustrating a case
in which the customers complain that the product is late.
Examine the many possible causes for the delays. Use your supporting infor-
mation to help you identify the most likely root causes of the delays, and to
quantify how late “late” really is. Is the complaint a recent development or
has there been a chronic problem? Look in the value stream to find the opera-
tions that are sources for the major issues. Ask these types of questions to
identify issues in the value stream that are directly affecting the customers:
" Are the operations running slower than takt time?
" Are there deviations to the work standards?
" Is the product not available for shipment?
" Have there been material supply issues?
" Are the drivers leaving late from the facility?
" Have there been any personnel changes?
Focus on fixing the process, not assigning blame to people. Lean is all about
respecting people. Most of the time, you will find a process problem (like a
lack of defined standards) preventing people from performing at their best.
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Chapter 5
Charting the Course: Using
Value Stream Maps
In This Chapter
! Analyzing the Current-State Value Stream Map
! Creating a vision of the future
! Planning your Lean implementation within the organization
T
o make a change, you need a catalyst. In Lean, the catalyst for change is
the recognition that the current state is not where you want to be. Lean is
applicable whether you need to fix something that’s broken or prepare for
new opportunities to come. This perspective comes from the Current-State
Value Stream Map (VSM), combined with supporting information like quality
data, customer complaints, or financial reports. So like that “fat picture” that
sends you to the gym and juice bar to get healthy, the Current-State VSM and
supporting information provides that objective reflection that nudges an
organization to modify its processes and practices and make the business
healthy and vital.
When you decide to make a change, not only do you plan where you’re going
to go, but you also consider where you could go. You ask what’s possible. For
example, when you decide to get healthy, does healthy just mean weighing
less? It may also mean better cardio performance, improved flexibility, lower
cholesterol, or a smaller clothing size. In a perfect world, what would a per-
fectly healthy you look like? The thought process is the same when you
decide to make changes in your business. In Lean, the Ideal VSM is used to
define that perfect world — what your business would look like if anything
were possible. You then use the Future-State VSM to paint the picture of where
you want to go next.
In this chapter, we show you how to analyze your Current-State VSM to get a
real picture of the process. You discover how to develop the Ideal-State and
Future-State Value Stream Maps. Along the way, we answer common questions
and respond to common objections about Value Stream Mapping. Finally, you
determine how your future plans fit with other organizational initiatives.
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Environment Machine Man " Are standardized work instructions available, being followed, and visible? Supply
" How can the workload be leveled? Most processes have inventory — either by accident or by design. Inventory
can collect at the beginning, somewhere in middle, or at the end of the process.
" Where can operations be combined to improve flow?
Inventory acts like a dam to the flow of the value stream. Where there is inven-
T raining " What exists in the value stream preventing the implementation of Lean tory, there is no flow. Likewise, where there are outages, there is no flow.
Heat spoiled Machine at this time? How can it be addressed? Balance comes in orchestrating the flow of material supply and processing
product down time precisely to customer demand — in other words, matching the cycle time to
New driver the takt time.
Quality
Late The quality practitioners — whether they’re from a formal quality function,
Figure 5-1: customer Strategically design the location of the inventory, the size of the inventory,
An Ishikawa delivery or, trained Six Sigma experts — examine value-added from the perspective of and the information flow throughout the value stream. Examine the Current-
correctness: Does the transformation happen correctly? Is it done right the
Diagram, Delivery route State VSM for how well it consumes supply and moves material through the
like the one under construction first time? Is the process capable of producing defect-free results regularly? process. You can do so by asking the following questions:
shown here, Inventory outage
is a tool you Assembly standards Think of debris dumped into a river and what it does to the flow of the cur- " What is the inventory turn level?
rent. When quality losses occur in the value stream, it is like debris dumped
can use to not followed
into stream — impeding its flow. The quality practitioners evaluate the " What is the size of the storage?
analyze Order not Defective
customer sent material process to identify where it isn’t capable of creating good product or service, " Where is the storage? In a warehouse? In process?
complaints. Obsolete and where suppliers or downstream contributors create poor quality for the
consumer. Analyzing the value stream from a quality perspective will lead " How low can it go? Can you maintain an inventory of one?
material Material Method and systems
you to ask the following types of questions:
" How is the inventory managed?
" Where is poor quality reaching the customer? What are the defects? " Do you practice first in first out (FIFO)?
If you answer “yes” to these types of questions, you have the opportunity to
use what’s called the 5 Whys. The aim of the 5 Whys is to find the root cause " How are quality issues reported from the customer, transmitted into the " What signals the withdrawals from the inventory?
of a problem. When using 5-Why questioning, you ask “Why?” until you’ve organization, and resolved?
exhausted answers and found the root cause of the problem. Practicing 5 " What are the reorder signals in the process?
" What is the fall-off rate at each step?
Whys is like becoming a curious three-year-old again, when the question " Where is material pushed through the system?
“But why?” was the first thing out of your mouth. Here’s what this technique " Where are the losses the greatest?
looks like in action: " Where is the material pulled through the system? Where else can pull
" What is the most common cause of scrap? signals be used in the process?
Are the drivers leaving late from the facility? " What is the root cause of the scrap (design, equipment, training, " How are the raw material quantities balanced with the shipping
Yes. But why? and so on)? quantities?
Because the product isn’t ready. Why? " How are suspect items handled? " How far does material travel in the value stream?
Because the production line was behind. Why? " How are reworked items returned to the normal flow? " How are the incoming material shipments coordinated?
Because the supplier was behind. Why? " How can the process, design, or equipment be designed to prevent " How is first in first out managed?
errors? " When a quality issue arises, how is the inventory handled/quarantined?
Because the order was issued late. Why?
" What is the capability of each step? " What is the dollar value of the inventory?
You get the idea. In this example, these whys would lead you to look at the " Which suppliers are the providers of the poorest quality?
ordering process. " What is the cost of floor space to handle the inventory?
" How frequently have quality spills occurred and in what location?
Start your Current-State VSM analysis by finding the sources of your cus- " What steps have been taken to quarantine defective product? Engineering
tomers’ irritations. After you’ve identified those sources, the next step is to Evaluate the Current-State Value Stream from the perspective of the engi-
look for muda (see the following section). neering disciplines: design, production, and maintenance. The engineering
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Investigating the Value Stream for Clues Searching for muda
You’ve seen your business through the eyes of your customer and examined
Anytime you use re– in front of a word, it is a candidate for waste elimination,
because, by its very definition, it means you aren’t doing it right the first time.
the direct causes of customer dissatisfaction. Now you must look within, and
In Chapter 4, we show you how to create a Value Stream Map (VSM) for the Get a physical layout of the work areas, and create a two-dimensional flow
find causes of waste occurring inside your business. During the first pass
current state of the business. After this initial Current-State VSM is complete, diagram that reflects the physical movement of material or people through
through the Current-State VSM, you initially designate process steps as value-
your next mission is to dive into it and understand where the waste is occur- the process. This technique is especially useful in manufacturing processes,
added (VA) or non-value-added (NVA). Now it’s time to examine these desig-
ring. You first start looking for waste when you qualify the value of the steps lab processes, restaurant kitchens, and other places where physical material
nations more closely.
in the stream (see Chapter 4). At this point in the process, you look for where moves through processes and places. These layouts are commonly known as
the flow is less than ideal. Spaghetti Diagrams (see Chapter 7), because after all the movements are
Refer to Chapter 2 for the precise definitions of value-added and waste.
drawn out, it tends to look like a plate of spaghetti!
If the process is in a state of ideal flow, you make one as the consumer takes
Lean strives to eliminate all wasteful forms. To find waste, ask the following
one (no matter what that “one” product or service is). The process is in per-
types of questions:
fect balance. All steps take the same amount of time. There is no inventory in
process. The process contains only value-added activities. All process steps
" Is excess inventory or work in process accumulating along the value
Analyzing from different perspectives
produce perfectly. You have the exact capacity needed for the consumption
stream? Different players in the value stream bring a different set of eyes and informa-
rate, with the exactly correct staff.
" Does the step create value? If not, why does the step exist in the process tion to the evaluation of the Current-State VSM. Whether you’re improving an
unhealthy business practice or enabling the pursuit of a new opportunity,
The Current-State VSM, combined with the use of the supporting data, pro- and can it be eliminated?
vide the clues telling you where to start looking for improvement opportuni- take the time to examine the value stream through different perspectives. As
" Does the step create scrap or rejects? If so, it’s a candidate for improve- you strive to find the muda, these different views can be invaluable sources
ties. In Lean, you strive for the entire value stream flowing unencumbered at
ment and, at the very least, further study. of insight.
a rate equal to the customer’s demand in the most effective manner (that is,
with the highest quality, the shortest lead time, and the lowest cost). You can " Is the step capable? If not, the step should be improved using statistical
quantify this customer demand by looking at the demand rate, or takt time. tools, like those found in the Six Sigma methodology. (For more informa- The VSM team will involve people working in the process who have a daily
By using this metric, you can start to analyze the current state to evaluate tion on Six Sigma, see Six Sigma For Dummies, by Craig Gygi, Neil DeCarlo, operational perspective. This will include process owners, including the
where blockages to the flow are occurring. The blockages can be traced and Bruce Williams [published by Wiley]) value-stream owner, and perhaps even the business owner. In addition to
directly to muda. You improve performance by resolving and removing the these participants, others have a keenly valuable perspective.
" Does the step perform as designed?
root cause of these blockages.
" Is the equipment needed to perform the step functioning? Lean principles: The Lean sensei’s view
The Lean process is one of seeking understanding. You seek to understand
" Are the materials required available, at the right quality level, and in the The Lean sensei is the master and teacher of the Lean principles and knowl-
the customer and the consumer. You seek to understand the nature of your
right quantity? edge. (For more information about the Lean sensei see Chapter 12.) The Lean
processes and the origins of waste and loss. The most fundamental Lean tool sensei guides and teaches the organization to learn, implement, and embody the
you use in your search is the question. You ask questions — many questions — " What is the capacity of the process step? How does it compare to the Lean philosophy. The lens through which the sensei evaluates the Current-
to discover truth and understanding. Because this process of investigation is takt time? State VSM highlights the short-term and long-term opportunities to institution-
one of asking questions, the analysis is framed by questions.
" Is the step flexible? alize Lean in the organization. The Lean view poses these types of questions:
" When changing from one product or service to the next, how long is the " How closely is the process producing to takt time?
process step not producing? (This question is aimed at understanding
Rounding up the usual suspects changeover time.) " How can the process be more visual?
As you begin your analysis of the Current-State VSM, start by considering the " Does the process step flow or is the step a bottleneck in the process? " How can workers be more empowered to stop the line when quality
most common causes. What does your customer say about you? The answer issues arise?
" How does the process time of the step compare to the customer
to this question will provide immediate insight. Even if the customer voices demand? " How is the material flowing through the process?
issues that aren’t at the root of the problem, the customer may give you clues
as to what the issue truly is. If you aren’t getting any indications from the cus- " Where best can continuous flow be implemented?
After designating each process step, the team can calculate the value-added
tomer, start looking for evidence of the three Ms: muda, mura, and muri. portion of the process and compare it to the non-value-added portion. " Where do supermarkets need to be implemented?
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Chapter 5: Charting the Course: Using Value Stream Maps
perspective will also help you examine the interfaces of the people, equip-
ment, and processes.
Think about the Army Corps of Engineers. They engineer the flow of the U.S.
waterways. They examine the current state and look for where modifications
need to be made. They dredge to create movement. They dam to manage
downstream flows. They design how and if flow happens. In a Lean organiza-
tion, the designers engineer how flow happens inside the value stream.
At this juncture, you’re evaluating the current state of production processes
and practices. Be aware that the designers are meanwhile developing future
designs of new products and services. Because the majority of cost is estab-
lished during the design phase, you want to involve the design engineers
during the Current-State VSM analysis. You also want to include the produc-
tion engineers to ensure continuity.
Analyzing the value stream from a production-manufacturing engineering per-
spective, will lead you to ask the following types of questions:
" Is the process designed for flow?
" Can processes be combined? Can alternative processes be used?
" How can operations be laid out to maximize the effectiveness of operators?
" How far away is the material or inventory being stored? How far does it
travel between operations?
" How is material presented into the process?
" How are the raw material quantities balanced with the shipping quantities?
" How can changeovers occur more quickly? How can concepts like the
“Indy pit crew” be applied during changeovers?
" What modifications can be done to equipment to prevent errors, facili-
tate the operation, eliminate workload from operators, combine opera-
tions, or facilitate flow?
" Is standardized work being followed? How can it be modified to improve
quality and eliminate unnecessary processing or movement?
" How can cycle times be balanced with takt time?
Analyzing the value stream from a design engineering perspective, will lead
you to ask the following types of questions:
" What type of product defects occur during the process? Where do they
occur?
" How can features be built into the design so it cannot be made incorrectly?
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101 102 Part II: Understanding Flow and the Value Stream
" What issues in the current design might be in the future designs?
" Can the design be simplified to facilitate production without compromis-
ing customer requirements?
" Are certain design specifications unnecessary for the customer require-
ments? Where can specifications be eliminated or changed without
impacting customer requirements?
" Are the design tolerances properly specified to ensure the product can
be made right the first time, every time?
Analyzing the value stream from a maintenance/equipment engineering per-
spective, will lead you to ask the following types of questions:
" What is the uptime of the equipment?
" What is the current maintenance schedule? Is it reactive or planned? If
planned, is it preventive or predictive?
" What modifications can be made to the equipment to prevent defects
from being produced?
" What pieces of equipment have the greatest maintenance issues?
" Are there different brands of equipment performing the same
function/operation? Is there a difference in performance level?
" What modifications can be made to the equipment, tooling, and process
to facilitate quick changeovers? (See Chapter 8.)
" What is the process to notify maintenance? How can it be improved?
" When there is an issue, what is the response time for maintenance to
respond? What is the time to resolve the issue?
" What simple maintenance activities can be transferred to the operators
to perform?
" What modifications, features, or controls can be added to the equipment
to enable operators to run multiple pieces of equipment?
" What controls can be added to the equipment to automatically stop
when defects are produced or equipment problems arise?
Although the questions in this section relate to the production of a product,
they also apply to a service environment. In a transactional environment, like
the hospital admissions process, the quality perspective is customer service
and data integrity related. The material perspective is patient flow and data
related. The process engineering perspective may be from a software engi-
neering perspective. The wording of the questions may be slightly altered,
but the nature of the questions or analysis is similar to the example ques-
tions in this section.