1. Value Stream Mapping

2. Exempla Good Samaritan Medical Center
June 30, 2009
PAUL KOBISHOP
30 years of experience improving processes
Managed multi-plant manufacturing organizations in aerospace and medical device industries
15 years experience educating clients in effective Lean Enterprise methodologies
Experience as production floor operator to directorships of manufacturing division operations
Manage $15mm NPD projects
Lean projects with direct improvements in operating costs on average of 15% ($1.5m)
MBA in Operations Management, and Mechanical Engineering
[MC]: Go over Paul Kobishop resume quickly.
Do not reproduce without permission

3. INTRODUCTION
“Visually documenting the actions required to bring a product through the main flows essential to every product.”
Includes design, flow of information and flow of work and materials
Look at the big picture, not just individual processes
“Learning To See”
Value Stream Mapping is a relatively new packaging of a well-known concept of flow-charting. The additional tools of VSM include lean-specific symbols that are useful both to document the flow of our current processes and well as to plan for the “future state” improvements that we will want to make. Since few words are used it is easier to understand than a written description, and also easier to create.
The VSM is therefore a flow chart describing the relationship of various work elements. Note that while many manufacturing flow charts only document the flow of material, VSMs also attempt to understand and document the flow of information and other essential processes like new product development.
It’s important to understand that a VSM is not intended to be a highly detailed document. We’ll leave the excruciating detail to our Standard Work documentation, to understand all of the detailed work steps. Think of it as flying at 30,000 feet, and surveying the land below. If we try to get too detailed with our VSMs, they will become increasingly difficult to understand. It should remain very much a big picture document.
In a company with many different products and product families, we can also expect to have many different Value Stream Maps. One document describing the entire company and all product lines would be massive and unwieldy, to say the least. So each map typically describes a family of products or a logical grouping of processes.
We normally start with the creation of a “current state” VSM, but other than perhaps understanding the current state for the first time in its entirety, the current state VSM is only a spring-board for the improvements we’d like to make. We’d like to get to a future state VSM quickly, and of course these plans are only useful if they are implemented.

4. TYPES OF VALUE STREAMS
“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
Value Stream Mapping is a relatively new packaging of a well-known concept of flow-charting. The additional tools of VSM include lean-specific symbols that are useful both to document the flow of our current processes and well as to plan for the “future state” improvements that we will want to make. Since few words are used it is easier to understand than a written description, and also easier to create.
The VSM is therefore a flow chart describing the relationship of various work elements. Note that while many manufacturing flow charts only document the flow of material, VSMs also attempt to understand and document the flow of information and other essential processes like new product development.
It’s important to understand that a VSM is not intended to be a highly detailed document. We’ll leave the excruciating detail to our Standard Work documentation, to understand all of the detailed work steps. Think of it as flying at 30,000 feet, and surveying the land below. If we try to get too detailed with our VSMs, they will become increasingly difficult to understand. It should remain very much a big picture document.
In a company with many different products and product families, we can also expect to have many different Value Stream Maps. One document describing the entire company and all product lines would be massive and unwieldy, to say the least. So each map typically describes a family of products or a logical grouping of processes.
We normally start with the creation of a “current state” VSM, but other than perhaps understanding the current state for the first time in its entirety, the current state VSM is only a spring-board for the improvements we’d like to make. We’d like to get to a future state VSM quickly, and of course these plans are only useful if they are implemented.
MPW-I Facilitator Notes Rev. 9/05

5. A VALUE STREAM Information Production Control
Inputs – Processes - Outputs
Production Control
Information
Materials

6. CREATE THE CURRENT STATE
Value stream mapping begins with a door to door product flow analysis. Physically walk through the pathways of material and information. Follow up with a detailed information gathering walk-through.
Begin at the end
Record fresh data. Bring a watch.
Document the entire flow as you walk through. Don’t try to remember later.
Material Flow
ASSY
TEST
PACK
SHIP
VSM Direction

7. CURRENT STATE VSM Total cycle time = 403 Days Processing
This case history presents and explains a Value Stream Map created by Boeing or Northrop document the current procurement process. The instructor will need to be familiar with the process steps, and/or have a student in the group assist in the explanation of the VSM.
Consider preparing and handing out hard copies to the participants in a larger size format for them to keep.
Total cycle time
= 403 Days
1.5 days
2.5 days
62 days
1 day
1 hr
8 hrs
18 hrs
Processing
time = 30 Days

9. MPW-I Facilitator Notes Rev. 9/05
Don’t try to explain this VSM in detail. Simply point out the structure that we follow:
Suppliers on upper left.
Customers upper right.
Planning and information flow upper center.
Flow of material from left to right on the bottom
Timeline.
Also point out the general complexity and large number of queues.
This list was taken from the book Creating Mixed Model Value Streams by Kevin Duggin.
MPW-I Facilitator Notes Rev. 9/05

10. 4.2 min reduction in door-to-balloon time
Do not copy without permission

12. AEROSPACE OFFICE VSM MPW-I Facilitator Notes Rev. 9/05
This is an example of a VSM for an office implementation at Boeing.
Don’t dwell on this, simply point out that the same tools that we used in the factory can also be used in the office. VSM is one of them.
MPW-I Facilitator Notes Rev. 9/05

13. VALUE STREAM MAP SYMBOLS
The Value Stream Mapping method is basically a flow-charting technique, but we use a set of specific symbols to create the flow chart. These symbols can be used to describe the “current state” VSM, the way we do things today, and also the “future state” VSM or how we might improve the process. Some of the symbols are generic and could be used in either Value Stream Map, while other symbols are Lean Manufacturing specific.
Standard and commonly used symbols include the Process Box, Data Box Outside Source, Truck and Plane Shipments, Material Flow arrows, Buffers, WIP, Manual and Electronic Information. Lean specific symbols include Heijunka Box, Supermarket, various Kanban symbols, Load Leveling, FIFO flow.
It is not necessary to use all of the symbols, of course. The most common one will be the Process Box. Keep in mind that a process is a higher level concept referring to a logical grouping of work steps that are performed in the same physical location. The VSM should not be so detailed that it is hard to understand and takes forever to complete. There is a time for detail, but the VSM is a higher level view of our processes and how they are related.
Segue: We have some actual examples of Value Stream Maps from your company, but first let’s take a look at the VSM from the workbook on Value Stream Mapping “Learning To See”.

14. This slide shows the various uses and benefits of a Value Stream Map:
Because it is a drawing, it can help us to visualize and understand the flow of processes. We physically lay out the VSM from left to right, so that we have an awareness of time. Creating a time-line at the bottom of the VSM is also a recommended feature.
You’ll recall that Lean Manufacturing is focused on waste elimination, and the VSM can help us identify areas of opportunity for the elimination of waste. Queue times are included on the VSM, and the elimination of queues is one of the first things that we attempt to do.
Because the VSM is not text-dependent, it provides a common language for communication. Multi-language environments are common today, and the VSM can help overcome language barriers that might exist when discussing the manufacturing flow.
Having a flow chart can become a focal point for discussion among team members. Walk through the VSM as a team, and make sure that everyone is in agreement regarding the flow shown.
Our implementation plans should include the “future state” Value Stream Mapping drawings, which become essentially a plan of action for what needs to be changed.
Most flow charts do not include information flow, which can be a significant contributor to our overall lead time. The VSM is unique in that it does include this type of information.
Jim Womack, in his introduction to the book Learning To See, mentions that many companies eager to launch their lean initiative often bypass the creation of VSMs and jump right into the elimination of waste, Kaizen projects, etc. This is a mistake, since without creating this high-level perspective it will be difficult to know where the largest opportunities and bottlenecks really are. We may end up focusing on the wrong things if we don’t step back and create our VSM first. On the other hand, VSM in itself should not become a project or take too long. It really should only take a few days to complete the mapping of an area. Don’t make VSM an end in itself. By itself VSM is non-value-added. Value is only added if it leads to actual process improvement change.

15. WHAT INFORMATION IS NEEDED?
Cycle Time
Actual (C/TA)
Theoretical (C/TT)
Changeover Time
Planned (C/OP)
Actual (C/OA)
Batch Size
Downtime
Yield
Shifts
# of Operators
DATA BOX

16. PUSH ARROW
Represents a process connection in which the UPSTREAM process does not care if the DOWNSTREAM process is ready for its output.
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17. Represents the movement of a unit of value in between processes.
TRANSPORT
Represents the movement of a unit of value in between processes.
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18. DELAY
Represents the time during which there is no work being applied to the unit. A typical symptom of delay is “waiting for…”
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19. ANALYZE THE CURRENT STATE
Use Tools of Kaizen To Reduce Variation & Create FLOW……..
Hoshin Planning
FLOW
Kanban
TPM
Standard Work
Poke-Yoke
Quick Change Over
Pull
5s / Visual Workplace
Team Skills
Leading Change
Inputs – Processes - Outputs
Suppliers
Customers
Speed - Accuracy

20. FUNCTIONAL COST-BASED ORGANIZATION
WORK I
WORK I
WORK I
TIME = WEEKS
THE VALUE STREAM
So let’s look at things that slow us down. This is a picture of a traditional, i.e., slow, manufacturing environment. Notice that there is a significant amount of delay or queue time between processing steps. This is a lack of flow, obviously. Up to 95% of the elapsed time can be queue, and only 5% actual hands-on time. This is especially true if we could calendar time. If we’re only working 1 shift, the 2/3 of the day is also queue.
Probe the extent to which they are currently engaged in batch and queue practices.
Question: is there a pile up in front of QC? Do they have long setup times?
MPW-I Facilitator Notes Rev. 9/05

21. 7 TYPES OF NON-VALUE-ADDING ACTIVITIES
Waste of resources beyond what is needed to meet customer needs
Overproduction
Transportation
Waiting
Inventory
Overprocessing
Motion
Rework

22. SEVEN COMMON WASTES
Transportation Inventory Motion Waiting Over Processing Over Production Defects
Alternate Terminology
8 Wastes - Adding “People’s Talents” as the eighth waste

23. HOW CAN WASTE BE DETECTED?
Process Flow or Value Stream Map
If you cannot find the waste, look for activities that actually add value to the product; everything else is waste

24. ELIMINATION OF WASTE: WHAT CAN YOU DO?
Over-production 1
Reduce changeover times
Eliminate anticipatory production (producing in advance of customer demand)
Waiting 2
Balance workload of equipment/people (e.g., by debottlenecking equipment)
Fill waiting time with other activities
Optimize interfaces with internal/external suppliers
Transpor-tation 3
Load once
Over-processing 4
Provide standards
Review current process design (e.g., value analysis)
Inventory 5
Define necessary inventory levels
Improve process reliability
Rework 6
Ensure proper sequence of work
Install mistake-proofing steps (quality control)
Motion 7
Arrange tooling/equipment
Design ergonomic workplace

25. TAKT TIME Rhythm or Beat Time and Volume Relationship H (S) / D
Sets maximum capacity of line
By Process!
German word meaning “beat”. The method was originally developed in Germany in the 1930’s and used to build aircraft, so there is a strong aerospace connection!
Takt time is expressed in minutes, seconds or hours (and sometimes days), and refers to the target or planned amount of time for each unit to be completed. Think of a moving assembly line. An example of Takt time would be how often a unit is completed.
H = Effective Work Hours per Shift
S = Number of Shifts
D = Daily Demand in Units
A mixed model calculation would need to add up the total demand for all models.
You can run slower than Takt time, but you really can’t run faster without rushing. So it is the maximum capacity during normal working hours.
You will need to calculate Takt time for every process. For example, a car has five wheels (a spare) and one chassis. The Takt time of the wheel process is going to be 1/5 the Takt time of the chassis process. Every process can have a different Takt time.
Takt time modifiers:
Options
Rework
Scrap
Differences in working hours
Differences in quantity consumed
MPW-I Facilitator Notes Rev. 9/05

26. ROUGH CUT RESOURCE PLANNING
Formula: STw / TAKT
STw = Ʃ(ST x D) ƩD
First pass resources only!
Calculate by process
Uses for Simulation Modeling
The calculation of resources is the end result of all of this work, and it tells us how many people and machines we need to support a given volume of daily product.
Formula = Standard Time Weighted divided by Takt.
Discuss the “weighted” concept. Sixth grade arithmetic, for the math-phobic.
Since we calculate Takt time by process, we also calculate resources by process.
First pass because it does not include a consideration for balance or variability.
Simulation modeling is recommended if there’s a significant investment involved. This is what the big boys do.
We call this calculation rough-cut because it includes several inputs that are variable: demand and standard time. The calculation does not reflect the impact of variability, delays, blockages and move times that will impact available work time.
MPW-I Facilitator Notes Rev. 9/05

27. KANBAN SIZING FORMULA Formula: (D x Q x R) / P
D = Rough Cut Volumes for end item
Q = Quantity Per at component level
R = Replenishment Time Allowed
P = Package Quantity (Default = 1)
Mixed Model = Σ(D x Q)
Walk through elements of the formula.
Demand does not have to be the same number used for line design. Usually less.
For common material only.
MPW-I Facilitator Notes Rev. 9/05

28. OUR OBJECTIVE IS TO REDUCE WASTE ….
….and increase the percentage of value added, in order to reduce cost
Waste
Value-added activity
Incidental activity
Elements of work

29. ? ? ? FLOW PROCESSING WORK I WORK I WORK I TIME = DAYS
THE VALUE STREAM
Our first focus is on reducing internal lead-times by eliminating queue. We will do this by physically linking the processes together, reducing setup times, cross-training, and introducing signals called In Process Kanbans. Our goal is to get the work to “flow”, I.e. go to the next processing step without delay or defects.
Once we’ve accomplished this, we turn our focus to the work itself, but not before we’ve done what we can to eliminate queue. This is also related to the concept of “single piece flow”, since moving the material in batches introduces large amounts of queue.
You can optionally do the paper signing exercise to further demonstrate the difference between batch and flow.
MPW-I Facilitator Notes Rev. 9/05

30. IMPROVING WORK TIME = HOURS THE VALUE STREAM NON VALUE ADDED ERRORS
LINE
TIME = HOURS
THE VALUE STREAM
If we look closely, via Standard Work documentation, at the work that we do, we find that it is composed of several different types of activities:
Non-value-added work, that is, work that does not benefit the customer.
Rework and defects, that is, doing things more than once.
Value added work that can be done better, that is, streamlined.
This type of improvement is usually done over time, via the Continuous Improvement process. When documenting work we can also take advantage of that opportunity to take a close look at work being done as well.
MPW-I Facilitator Notes Rev. 9/05

31. We identified the delays We identified the waste
We identified the sources of waste
What do we do about them?
Focus on WHAT needs improvement and HOW it can be improved
Once an idea is selected, display on VSM
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32. LEAN TOOLS Set-Up Reduction Value Stream Kanban- Pull Systems
Improvement
Process (VSM)
Kanban- Pull Systems
Office Kaizens
The one common element: these tools help us eliminate waste from our processes.
Flow Manufacturing
MPW-I Facilitator Notes Rev. 9/05

33. FUTURE STATE VSM Total cycle time = 21 Days Processing time = 18 Days
This case history presents and explains a Value Stream Map created by Boeing or Northrop document the current procurement process. The instructor will need to be familiar with the process steps, and/or have a student in the group assist in the explanation of the VSM.
Consider preparing and handing out hard copies to the participants in a larger size format for them to keep.
Total cycle time
= 21 Days
1 day
.5 days
10 days
2 days
3 days
Processing
time = 18 Days

35. MPW-I Facilitator Notes Rev. 9/05
Don’t try to explain this VSM in detail but point out the major differences:
Simplified flow and fewer queue points.
Reduce total cycle time.
The use of the Kaizen burst symbols.
Also remind the team that we will be creating both a current and future state map with them.
MPW-I Facilitator Notes Rev. 9/05

36. Do not copy without permission

38. KAIZEN BURST
Represents an idea for improvement that can be implemented using the Kaizen methodology.
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39. Make initial estimations of resource needs
Each Kaizen burst documented in the Current State VSM must be associated with a tool(s)
Make initial estimations of resource needs
Make initial estimations of benefits
Kaizen Event vs.. Quick & Easy Kaizen
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40. Prepare a project plan for every event in a simple tabular form
Describe WHAT the opportunity is
Identify HOW it is going to be addressed, including the specific set of tools that apply
Specify WHO is going to be Project Leader
Indicate WHEN you expect this event to take place
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41. LET’S JUMP IN ?

42. Questions
Paul Kobishop