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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

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Value Stream Mapping

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Value stream mapping l.jpg

Value Stream Mapping

Management is Essential

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The lean transformation should provide:

  • Growth with improved margins

  • Growth with minimal capital

  • Growth without more employees

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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

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How have these stumbling blocks been addressed?

  • Programs of the month (band aids)

  • Meetings, meetings, meetings, meetings

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If we could just start over…..with

  • Activities aligned with a business strategy

  • Efforts focused on NET improvements for the company

  • Metrics supportive of fundamental change

  • Simple, constant communication of plans and achievements as an enterprise

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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 – Engineering

  • Order to Cash - Administrative Functions

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Value Stream Definition

  • 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.

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Value Stream Improvement vs. Process Improvement

Value Stream










Finished Product

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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

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process level

single plant

(door to door)

multiple plants

across companies

Levels of a Value Stream

Start Here

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Process 1

Process 2

Process 3

Value Stream Managers



The Value

Stream Manager

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Using the Value Stream Mapping Tool

Product/Service “Family”

Understanding how things currently operate. Our Baseline!

current state drawing

future state drawing

Designing a lean flow. Our vision!

plan and implementation

The Goal of Mapping

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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

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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

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Current State Value Stream Map

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Future State Value Stream Map

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Planning and Implementing

  • Don’t 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

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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

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Enterprise Perspective

  • Engineer to Order

  • Configure to Order

  • Capital equipment manufacturers

  • Small companies (<500 employees)

  • Service Firms

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We might begin in…

  • Processes directly impacting the part production

    • Engineering

    • Quoting

  • Or, in value streams with direct customer contact

    • Order entry

    • Invoicing

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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

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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

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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

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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

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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.

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