Value Stream Mapping – Gaining Traction, Getting Results

Paul Bolesta, Project Manager VPMEP - Richmond 804-323-2226 x231

Agenda

1 – Obstacle to Traction - WASTE 2 – Benefits of Value Stream Mapping 3 – What is Value Stream Mapping? 4 – A Road Map for Improvement

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4 .What is WASTE? Any Activity that DOES NOT increase the Market Form or Function of the Product or Service based on the Critical Customer Requirements. These are things the customer is NOT willing to pay for.

) 5 .Definition of Value Added Value Added Any activity that increases the market form or function of the product or service. (These are things the customer is willing to pay for. or integrated. reduced. (These activities should be eliminated.) Non-Value Added Any activity that does not add market form or function or is not necessary. simplified.

Lean = Eliminating the Wastes Value Added Non-Value Added • Defects • Overproduction • Waiting • Not Utilizing Employees • Transportation • Inventory • Motion • Excess Processing Typically 95% of all lead time is non-value added 6 .

• Not Utilizing Employees – old guard thinking. poor flow • Inventory – large batches. complexity to complete task • Motion – poor organization. politics. approvals process can work on them. customer requirements are not clearly understood All processes have waste. slow system response. no standard work • Excess Processing – excess communication. unbalanced work loads • Waiting – unbalanced work loads.Where is the Waste? • Defects – incomplete or incorrect information • Overproduction – releasing work before next incomplete information. 7 . low investment in training • Transportation – poor layout. lack of communication. high turnover. unnecessary approvals.

” Albert Einstein 8 .Without Change There Can Be No Improvement “The definition of insanity is doing the same thing over and over and expecting different results.

The Lean Process Identify waste Current state Measure & Adjust Continuous Incremental Improvement Future state Implement 9 .

Benefit of Value Stream Mapping •Understanding the Process •Information and Material Flow •Data Driven Decision Process 94% if Failures are due to Poor Systems 6% are caused by Worker Mistakes Deming 10 .

there is a value stream.Look for Value Streams “Whenever there is a product or service for a customer.Engineering Order to Cash – Services including Support Processes 11 . The challenge lies in seeing it.” Examples: Raw Materials to Customer .Manufacturing Concept to Launch .

Value Stream Mapping is a Key Process Diagnostic Tool Kaizen Continuous Improvement Pull/Kanban Quality at Source Standardized Work 5S System POUS Cellular/Flow TPM Quick Changeover Teams Value Stream Mapping 12 Batch Reduction Visual Layout .

• Draw the Future State map.Value Stream Mapping Steps Product / Service family • Select product / service family • Draw Current State map. • Identify opportunities for elimination of waste and areas of improvement to meet customer’s needs. Current state drawing Future state drawing Plan and Implementation 13 . Design a lean flow using lean techniques. Understanding how the process currently operates. • Develop action plan and implement it.

25 days 5 min 1 day Total Lead Time = 2.65 days Total Processing Time= 24. 2007 Semi-Weekly Ship Schedule MRP MRP Production Schedule Information Check Credit IN Receive Order IN Review & Enter Order Reconcile Order IN IN Confirm Order IN Finalize Order IN Fax P/T = ½ min Batch = 4 hours FIN P/T = 1 min % Accept = 90% Batch = 4 hours MRP P/T = 10 min % C&A = 60% Batch = 1.6 hours MRP P/T = 1 min %C&A = 75% Batch = 1.5 days 10 min .Incoming Orders Weekly Fax Order Entry Process Current State .2 days 7 min .2 days 1 min .6 hours Phone P/T =7 min %C&A = 85% Batch = 2 hours MRP P/T = 5 min Batch = 1day Material .5 min First Pass Yield = 34.5 days ½ min 1 min .4% 14 .Sept.

Is there an opportunity to balance the work load and/or different activities? 7. What does the customer really need? 2. How often will we check our performance to customer needs? 3. What process improvements will be necessary? 15 . Which steps create value and which are waste? 4.Future State Questions 1. How do we control work between interruptions? How will work be prioritized? 6. How can we flow work with fewer interruptions? 5.

5 min First Pass Yield = 34.Sept.5 days ½ min 1 min .65 days Total Processing Time= 24.2 days 7 min . 2007 Semi-Weekly Ship Schedule MRP MRP Production Schedule Receive Order IN All orders will be processed within one hour Review & Checkof receipt (6 Enter Order processed each hour).6 hours P/T = 5 min Batch = 1day Batch = 2 hours .5 days Each hour.Incoming Orders Weekly Fax What does the customer really need? Order Entry Process Current State .25 days 5 min 1 day Takt Time = 460 minutes 46 Orders = 10 minutes/order Total Lead Time = 2. 10 min 1 min .4% 16 . Credit Reconcile Order Confirm Order orders IN IN IN IN Finalize Order IN Fax FIN MRP MRP Phone MRP P/T = ½ min Batch = 4 hours How often will we check our P/T = 1 min P/T = performance min customer needs? min 1 min P/T = 10 to P/T =7 %C&A = 75% % Accept = 90% % C&A = 60% %C&A = 85% Batch = 4 hours Batch = 1.2 days .6 hours Batch = 1.

5 days ½ min 1 min .2 days 7 min % C&A = 60% Batch = 1.6 hours %C&A = 85% Batch = 2 hours P/T = 5 min Batch = 1day .5 min First Pass Yield = 34.25 days 5 min 1 day Takt Time = 460 minutes 46 Orders = 10 minutes/order Total Lead Time = 2.2 days 10 min 1 min .4% 17 . 2007 Semi-Weekly Ship Schedule MRP MRP Production Schedule Receive Order Fax Stop walking to Check Credit the FAX IN that’s FIN waste!!! P/T = 1 min % Accept = 90% Batch = 4 hours Rework Review & Enter Order IN IN Over Processing Confirm Order IN IN Reconcile Order Finalize Order Waste MRP Waste MRP IN MRP Phone P/T = ½ min Batch = 4 hours Which = 10 min create min steps value?P/T =7 min P/T = 1 P/T Which are waste? .65 days Total Processing Time= 24.Incoming Orders Phone Or WEB Weekly Fax Order Entry Process Current State .Sept.5 days .6 hours %C&A = 75% Batch = 1.

25 days Total Processing Time= 11.5 min First Pass Yield = 90% 18 .2 days 10 min 1 min . 2007 Semi-Weekly Ship Schedule MRP MRP Production Schedule How can we flow work with fewer interruptions? Check Credit Review & Enter Order IN IN Receive Order IN Reconcile Order IN Confirm Order IN Finalize Order IN Fax FIN MRP MRP Phone MRP Finance Cross Train .5 days 1 min P/T = 10 min % C&A = 60% Batch = 1.2 days 7 min .5 days ½ min P/T = ½ min Batch = 4 hours P/T = 1 min % Accept = 90% Batch = 4 hours Link Finance / MRP .6 hours P/T =7 min %C&A = 85% Batch = 2 hours Auto Confirm P/T = 5 min Batch = 1day .25 days 5 min 1 day Takt Time = 460 minutes 46 Orders NEW = 10 minutes/order METRICS! Total Lead Time = 1.6 hours P/T = 1 min %C&A = 75% Batch = 1.Sept.Incoming Orders On-Line Order Entry Weekly Fax Order Entry Process Current State .

MRP/FIN P/T < 10 min % accept = 90% Batch = 1 How can we control work between interruptions? 19 . Link Production to Customer Demand.Incoming Orders Order Entry Process Future State . Optimize (level) and Control Inventory.Sept. 2007 Semi-Weekly Ship Schedules Phone / Web Receive / Credit Check / Reconcile Confirm MRP Schedule MRP Production Production via FG Kanban Schedule Implement Kanban Kanban will: Schedule Production to real time demand.

T.Incoming Orders Order Entry Process Future State .Sept. Link to Order Entry Direct Schedule Shipping Shipping Training If FG Kanban is implemented what improvements can be made to Shipping? 20 . 2007 Semi-Weekly Ship Schedules Phone / Web Receive / Credit Check / Reconcile Confirm MRP Schedule Production via FG Kanban MRP/FIN P/T < 10 min % accept = 90% Batch = 1 I.

2007 Phone / Web Receive / Credit Check / Reconcile Confirm MRP Schedule Production via FG Kanban Shipping MRP/FIN P/T < 10 min % accept = 90% Batch = 1 Total Lead Time < 10 Minutes Future State Metrics! Total Processing Time < 10 Minutes First Pass Yield > 90% 21 .Incoming Orders Order Entry Process Future State .Sept.

With Employees .With Customers .e. Lean Six Sigma) • Determine Priorities and Resources Necessary .Structured Process Improvement • Track Impact through Metrics • Celebrate Wins .Use Robust Set of Tools (i.With Suppliers 22 .Implementation Road Map • Clarify Business Drivers and Key Customer Metrics • Assess and Map Current Capabilities (Baseline) • Identify Opportunities for Improvement including the elimination of WASTE • Create a Vision for the Future Based on Voice of the Customer and Voice of the Business • Analyze Gaps and Create Action Plan to Succeed .

Improvement requires change. Process Excellence will not be achieved without involving people at all levels of the organization. It is about Getting Things Done! 23 . To change a process you have to understand the process.Summary: ALL processes have WASTE that cost you MONEY. It is Not about Starting.

Questions? 24 .

Deming 25 .Parting Thought Learning is not compulsory … neither is survival. Dr.

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