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Value Stream Mapping- Fundamental to Understanding Flow & Waste

January 5, 2021 | Lean Tools

Value Stream Mapping – Fundamental to Understanding Connections & Waste

Value Stream Mapping is fundamental to understanding how different parts of the process are connected, identifying flow or anything that hampers flow…we call this “anti-flow, Inventory specifically Work In Progress:  This can be in a file bin, in the office or a staging area, or rack on the production floor.  We map the current State-How it is TODAY, and then Identify Symptoms of why we cannot meet customer demand.  This customer demand is called TAKT Time, or Net Time Available per Shift divided by Daily Customer Demand.  This can be measured per shift, or for the full day.  Most organizations work an 8.5-hour day, but after breaks, it comes to about 7.33 Hours per shift, or 21 hours if you are measuring a full day.  The idea is to match the output time to this required pace, rhythm, or cadence.  In fact, in some places, we actually focus on Pace Parts: Products or Services that are the highest priority and we design the output to make sure that we “hit” these pace parts hourly or daily.  A Value Stream Map also measures “touch-time,” called Cycle Time.  This is the current amount of time it takes to actually produce a part or product.  If we are below TAKT Time then we are ahead and have some capacity for more.  If we are above TAKT Time, then we are behind the customer’s needs.  We either have to improve the process, throw more labor into it, or understand how to divide the resources mathematically.  For example, a commercial coffee maker factory, where I have worked for about 20 years.  Our TAKT Time is 5 Minutes, which means we have to produce a complete coffee maker for Starbucks, every 5 minutes!  We have balanced out the line over the years, and have been successful to make sure that each production and assembly station does not take more than 5 minutes (Cycle Time).  Then we hit a challenge at the test station.  It takes twenty minutes to run each coffee maker through a performance test, to make sure the pc board and other electronics work, and that the unit can process water, without leaking.  So what to do?  Well, if we divide the 20-minute Test Cycle time by the 5-Minute Takt Time, we get 4.  This means that we need to have FOUR Test stations in order to balance out the Customer Demand.  Using this same technique, we look at the overall Value-Added Time, what the customer is willing to pay us for divided by the Non-Value Added Time, and this tells us, how much room for improvement there is in the process.  For example, it may take 28 days to complete and ship a product, a batch of product, etc., but it only takes about 2 hours of touch time to really complete the order.  The product sits in queue, waiting for parts, approval, being transported to outside processes, etc. for 29 days.  This means, that if we are able to remove all of the non-value-added work that we are doing, we can actually complete the order in 1 DAY!   Our lead times are too long and our due date performance is typically much less than perfect, so there is room for improvement.  This is what the Value Stream Map shows us. It can take just a few hours to create one, or weeks to create an enterprise-wide one starting from the sales order and going all the way through to shipping.  This is time well invested.   If we can get a job done on time, or in half the time and we only have a fraction of the transportation lead-time of our overseas competition, there’s no reason to lose work to overseas competitors. And if you can get a job done on time, in half the time with the SAME transportation lead-time, there’s no reason you can’t take market share from your USA competitors. 

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