IENG 451 - Lecture 06 Process Tools: Value-Added / Non-Value-Added, and Value Stream Mapping 5/16/2019 IENG 451 Operational Strategies (c) 2016 D.H. Jensen

Value Stream Maps (VSM) IENG 451 / 452 Value Stream Maps (VSM) The VSM is derived from SIPOC and Swim Lane diagrams: SIPOC and Swim Lane diagrams are high level maps These high level diagrams should be validated before VSM VSMs capture the details of the process, graphically VSMs are used for: Documenting the current state of the process, “AS-IS” Documenting the planned state of the process, “TO-BE” Identifying opportunities for improvement projects VSMs require data collection and take some time 5/16/2019 IENG 451 Operational Strategies (c) 2016 D.H. Jensen

VSM Illustration (AS-IS) IENG 451 / 452 VSM Illustration (AS-IS) Shows information from SIPOC diagram Suppliers / Customers Inputs / Outputs Process Steps Shows information from Swim Lane diagram Who does / functions Physical flows Communications Shows information from data collection Matl handling method Inventory levels Timing & performance data Dennis, P. (2015) 5/16/2019 IENG 451 Operational Strategies (c) 2016 D.H. Jensen

VSM Construction Steps IENG 451 / 452 VSM Construction Steps Determine the individual* product or service process that will be mapped*. Optimally, this: Has high volume and cost Meets criterial important to the company Has the biggest impact on the chosen customers *Has most common flow, if a family of products/services Place the process steps / functions Begin at the end of the process and work upstream Use the identified main activities & sequence (SIPOC) Use the agreed symbols (Suppliers/Customer factories, Activity/Process boxes, etc.) 5/16/2019 IENG 451 Operational Strategies (c) 2016 D.H. Jensen

VSM Construction Steps IENG 451 / 452 VSM Construction Steps Add the physical flow Show the physical flow going into / out of process boxes Show the sub processes and flows, include % of flow Use common symbols (Material flow arrows, material handling methods, …) Add the information flow Map the information flows Document the associated production orders for the parts Document the scheduling / tracking of the parts Use common symbols (Manual communications, Electronic communications, Informal communications…) 5/16/2019 IENG 451 Operational Strategies (c) 2016 D.H. Jensen

VSM Construction Steps IENG 451 / 452 VSM Construction Steps Collect the process data and add to the Process Boxes Walk the process to capture reality For each process step, capture Trigger Set-up & Process time Production rate Yield / Scrap rate Crew size Uptime WIP upstream & downstream Batch size Cost data 5/16/2019 IENG 451 Operational Strategies (c) 2016 D.H. Jensen

VSM Construction Steps IENG 451 / 452 VSM Construction Steps Add inventory levels, material handling equipment and process lead time data to the chart Include queue times, etc. for material flows Include the number of material handling equipment and personnel required for transport, if appropriate Include the storage space required, if appropriate Verify the Map Use non-team, process-knowledgeable persons to validate 5/16/2019 IENG 451 Operational Strategies (c) 2016 D.H. Jensen

VSM Illustration (TO-BE) IENG 451 / 452 VSM Illustration (TO-BE) Shows expected SIPOC –type information Suppliers / Customers Inputs / Outputs Leaner Process Steps Shows expected Swim Lane –type information Leaner Who does / Functions Leaner physical flows Leaner Communications Shows expected process data for the future Matl handling/storage methods Leaner Inventory levels Improved performance data Dennis, P. (2015) 5/16/2019 IENG 451 Operational Strategies (c) 2016 D.H. Jensen

IENG 451 Operational Strategies VSM Illustration Some typical symbols The symbols at right are pretty common … but there are no real standard symbols Typical Data Box stuff: Cycle Time C/T Processing Time P/T Changeover Time C/O Uptime / Reliability Batch Size Crew Size Available Time Output Rate Feed Rate, etc. … whatever characterizes the process as it operates! Dennis, P. (2015) 5/16/2019 IENG 451 Operational Strategies (c) 2016 D.H. Jensen

IENG 451 Operational Strategies Value-Added Concept Value-Added things are identified from the customers point of view: These are things our customers would pay for, if they knew we did it If you stopped doing it, would your external / end customers complain? Non-Value-Added are things our customers wouldn’t pay for, and fall into two categories: Business Non-Value-Added These are things the customer wouldn’t pay for, but are required to meet: Business requirements (GAAP record keeping, shipping manifests, …) Government requirements (OSHA record keeping, MSD sheet req.s, …) If you stopped doing it now, would anyone internally notice? Non-Value-Added This is true Muda, Mura, or Muri These are Japanese terms for waste, unevenness, and hard-to-do If you stopped doing it now, would anybody notice? 5/16/2019 IENG 451 Operational Strategies (c) 2016 D.H. Jensen

IENG 451 Operational Strategies Value-Analysis Starting at the end of the process (VSM), classify each step into one of the three categories: Value-Added These are tasks that should be optimized and standardized Record the VA time and display at the bottom of the VSM for each step Business Non-Value-Added These are tasks that are required for now, but should be periodically reexamined to see if they can’t be eliminated with a change in the business environment (customer relationship) Record the BNVA time for each step (and see below) Non-Value-Added This is true wasted effort and should be eliminated. Includes handling time! These may be quantized – they cannot be eliminated until the SOURCE is completely eliminated – and elimination of the source may require redesign of other processes as well. Record the NVA time, add BNVA time and display at the bottom of the VSM for each step – graphically, this provides a Time Value Map 5/16/2019 IENG 451 Operational Strategies (c) 2016 D.H. Jensen

Adding VA / Time Value Map to VSM IENG 451 / 452 Adding VA / Time Value Map to VSM 5/16/2019 IENG 451 Operational Strategies (c) 2016 D.H. Jensen

IENG 451 Operational Strategies Questions & Issues 5/16/2019 IENG 451 Operational Strategies (c) 2016 D.H. Jensen

IENG 451 Operational Strategies Categories of Muda Waste of Motion are identified from the customers point of view: These are things our customers would pay for, if they knew we did it Customers are often external, but are sometimes internal Waste of Delay are things our customers wouldn’t pay for, and fall into two categories: Business Non-Value-Added Waste of Conveyance are identified from the customers point of view: Waste of Correction are identified from the customers point of view: 5/16/2019 IENG 451 Operational Strategies (c) 2016 D.H. Jensen

IENG 451 Operational Strategies Categories of Muda Waste of Overprocessing are identified from the customers point of view: These are things our customers would pay for, if they knew we did it Customers are often external, but are sometimes internal Waste of Overproduction are things our customers wouldn’t pay for, and fall into two categories: Business Non-Value-Added Waste of Knowledge are identified from the customers point of view: Waste of Correction are identified from the customers point of view: 5/16/2019 IENG 451 Operational Strategies (c) 2016 D.H. Jensen