There are a variety of business processes that receive a significant amount of attention from entrepreneurs, as they can be some of the more vital aspects of running a company. Despite this, there are several that many budding business owners may overlook, regardless of how essential they can be for the company.
One of the more prominent of these is value stream mapping, which is a term that many entrepreneurs may not be familiar with. This is something that should be looked at by everyone running a business, as it can often be one of the more beneficial for a company.
There are several things that you should know about value stream mapping to ensure that you can implement it effectively.
What Is Value Stream Mapping?
A value stream map is a way to visualize the turning a customer request into a product or service. Value stream mapping (VSM) is the process of doing so and can offer a holistic view of the entire production process. This means that it can be described as the process of creating the production path from supplier through to the customer.
The Origin Of Value Stream Mapping
Value stream mapping has an extensive history, although it hasn’t always been called this. Initially, it was called “material and information flows,” and can be tied to the Toyota Motor Corporation.
This was used by the company to visualize the information and material flow within the organization so that improvements and modifications could be made. “Value stream” is a phrase that was introduced by Daniel Jones, Daniel Roos, and James Womack in the 1990s.
This was used to refer to the actions needed to bring a product through the key management tasks required to successfully release it to market. Since then, it has continued to grow in popularity among businesses.
Value Stream Mapping Symbols
There are a variety of symbols that are used in VSM, many of which may have different meanings depending on how exactly they’re used. While there are a significant number of them that have proven to be popular, this doesn’t mean that you can’t use your own. The ones that you should be aware of include:
- Dedicated process flow.
- Shared process.
- Data box.
- Push arrow.
- Material pull.
- FIFO lane.
- Safety stock.
- External shipment.
- Production control.
- Manual info.
- Electronic info.
- Production Kanban.
- Withdrawal Kanban.
- Signal Kanban.
- Kanban post.
- Sequenced pull.
- Load leveling.
- MRP/ ERP.
- Go see.
- Verbal information.
- Kaizen burst.
- Other information.
10 Steps To Complete A Value Stream Map
Creating a value stream map is something that many companies may want to do but may not know how to. While the process may seem complicated, there are several simple steps you can take to create a map that’s effective and easy to follow.
- Preparation is key to ensuring the success of everything. This means that you’ll need to put together a cross-functional team that can carry out the mapping process. Having a manager in charge of this team can make things faster and simpler.
- You should then utilize this team to take a look at your current state map or overall processes. Knowing where you currently are can be an essential aspect to planning ahead and creating your VSM.
- Next, you should decide what processes and areas you’ll want to map out while looking at which products share the same processes that can be improved upon.
- If you create several products, then you’ll need to decide which ones that you’ll want to focus on with the VSM. This is because each may be affected differently by various changes.
- You’ll then need to decide on what you’ll want to map. While many businesses will look at the whole supply chain, some will focus on part of it.
- You should then decide on your approach. Some companies will start with the end result of the production process and work backwards; others will take the opposite approach.
- This then leads to the addition of an information flow, which should look at how customers order products to how these orders are fulfilled.
- You should then begin collecting this data and start analyzing how changes are affecting the process.
- Any problems that present themselves should then be acted upon, which is also the case for any improvement opportunities that may present themselves.
- Lastly, you should be prepared to revise your VSM and any production processes over time. Adapting to changes in the market and supply chain can be vital in ensuring continued success.
Once you’ve taken each of the above steps, you should have a VSM that everybody in your business is able to understand and follow.
What Information Does A Value Stream Map Show?
When it comes to creating your value stream map, there can be quite a significant amount of information to include. This leads to many people wondering what should be added to the VSM. This can vary depending on how many products a company creates, as well as how detailed they want to be when doing so.
Should you create several products, then you’ll need to include information about each of these and adjust the VSM whenever products are added or removed from production. While creating the map, there are several pieces of data that you’ll need to include:
- Cycle time – the time a product needs to be produced;
- Up-time – when work is being done;
- Change over time;
- Shifts worked;
- Number of available operators;
- Available working time per week;
- Pack or pellet size;
- Batch size, and;
- Scrap rate.
Tips For Creating A Value Stream Map
Many companies may not know how to create a value stream map effectively. Luckily, there are a variety of tips that a business will be able to take advantage of when creating their VSM.
The first of these is to draw your VSM by hand first. This will give you a better understanding of the methodology behind the process, which should help you further on in implementing the map. This will allow you to immerse yourself in the process from the start, which could make everything much easier to understand in the long-term.
You should also limit its scope. This is because having too many steps or processes to undergo may make the process much more complicated without providing any real benefits. It’s been recommended that between 10 and 15 should be enough to have a positive impact without placing too much strain on resources.
Starting with the basic building blocks of an organization can be a great way to approach the VSM. This is because you should have a higher rate of success if you get the basics of everything done first before moving on to the more complex.
Value Stream Mapping Mistakes To Avoid
When a business owner first starts value stream mapping, it can be easy to make mistakes. This has led to several becoming increasingly more common over the past few years. As they’re easy to make, they can be simple to avoid and overcome should they occur.
The first of these is to split up the mapping process across each department and plan to put it together later on. This should be avoided as it can make things quite complicated when you start putting them together. To overcome this, you should ensure that you have an inter-departmental team in charge of the VSM process.
This also means that each member of the team should be trained in VSM and that there should be someone at the head of the group.
Rushing through the process to start achieving results is also common. However, this can lead to inaccurate data being collected, which will result in mistakes being made further on. These could end up being costly. Your team should take the time to ensure that the information they receive is accurate before they act on it.
Many companies may also start the value stream mapping process without using metrics. This is something that should be avoided at all costs, as there is nothing to compare results to should metrics not be collected throughout the whole process. These should include timeline and workflow.
Value Stream Mapping Terms To Know
Similar to many other complex areas, value stream mapping has a variety of terms that may be confusing to those who are starting in the area. While some may be relatively simple, this doesn’t mean that they all are. These include:
- Cycle Time (C/T): This refers to how long it takes for a product to be completed, and can also be used for the time that an operator takes to finish their tasks before they have to repeat them.
- Value-Added Time (VAT): This is the time it takes for work elements to produce features that add to what the customer is willing to pay for the product.
- Lead Time (L/T): The time needed for a product to be completed from start to finish.
- Work Descriptions: This is the term used for the description of an employee’s role and the tasks they must perform.
- Number Of Workers: This is the number of employees that you will have working for you.
- Total Working Time Per Day: This is related to the number of workers you will have and will be multiplied by the number of hours each employee works per day.
- Demand: This is the term used to refer to how many products consumers purchase over a defined period.
- Capacity: Capacity is the maximum number of products the company can create.
- Quantity Of Work Performed: While this can be related to capacity, it often isn’t and can mean the number of products created daily, weekly, or monthly.
- Waiting Or Delay Time: This is the amount of time that production may stop as a result of problems being experienced.
- First Pass Yield: Also known as throughput yield, this is the number of units that come out of a process divided by the number going into it over a specific timeframe. This only refers to the number of usable products.
With the benefits that value stream mapping can have for your business, it can often be vital to implement it as early as possible. While this may seem as though it can be expensive up-front, this can achieve a significant amount of rewards in the future.
This means that the financing that it initially requires should be seen as a long-term investment.
Thanks for reading "Value Stream Mapping Guide To Effectively Turn Customer Request Into Products", by the Linchpin Team in Chicago, Raleigh, and Wake Forest.