Value Stream Mapping : VSM
Origins of Value Stream Mapping
Value Stream mapping (VSM) is a technique by which you review the flow of materials and information through the whole supply chain. Mapping from raw materials through to delivery to customer.
The reasons for doing this mapping exercise are to identify all aspects of waste within the whole supply chain, not just cherry pick individual elements for improvement.
Value Stream Mapping was developed by Toyota as part of the Toyota Production System (TPS) as a highly visual way to represent the entire supply chain very simply, it’s aim is to help eliminate waste, establish flow, improve value add and ultimately improve your profit by identifying all those areas of waste in the business.
Creating a current state Value Stream Map will allow you to identify those wasteful steps and begin to define your future state value stream map, value stream mapping is a very powerful tool for continuous improvement of your business.
Create Current State Value Stream Map
Value Stream Mapping your Current State
The Value Stream Map should cover one product or family of similar products that you build, you want to map from supplier to customer delivery through your factory, this will enable you to highlight how you can improve the whole process from start to end.
The first stage of the Value Stream Mapping Exercise is create your Current state map, this is your starting point and it should reflect the reality of your actual processes not what you believe it to be. Therefore you need to learn how to value stream map, something that is best learned by leaving your desk and getting out and observing exactly what is going on within your organisation at the workplace (The Gemba). Value stream mapping is not something that can be done from the comfort of your desk nor something that can based on what "should" be happening according to the company's procedures; it has to be real.
You should gather data at each main stage of your production, recording as much relevant data as possible such as lead times, inventory held, cycle times, number of operators, setup times, basically every piece of information that has a bearing on the process and your costs. This is best done as a team and also over different days as often the story at the start of a month for instance can be very different at the end.
The aim at this stage is to define the current situation, where we are today, later we will look at where we want to get to.
Value Stream Map VSM
Review Current State VSM
The next stage is to review what we have mapped, identify all of those areas of waste within the process. If you look at the example VSM above you will see that the total cycle time for the product is just eight minutes whilst the lead time through the factory is over eight days, this is a real example.
Imagine if you could line up all of the value adding processes next to each other and flow product in a batch of just one component between each process, it would be possible to achieve a time of just over 8 minutes from delivery of raw material to achieving a finished article, the rest of the time is waste!
Waste as defined by Toyota covers 3 main areas, Muda (non-value adding activities, the seven wastes), Mura (unevenness), and Muri (Overburden). By looking at the value stream map at we can identify all of these wasteful parts of the process. The build up of inventory in front of bottle neck operations, the excessive change over times, the long delays between different processes and so forth. This gives us the oportunity to look at the overall flow of materials and information and give us ideas of what we need to do to improve this flow. Many of the reasons why we do things in a specific way and that we have the waste in our organisations is purely due to how we organise ourselves.
VSM Future State Mapping
Create Future State Value Stream Map
The next step is to take what we have learned regarding the flow of information and materials and try to design an ideal process minimizing and eliminating the various wastes within the processes.
We will look at eliminating the delays between processes by introducing smoother flow using Just in Time (JIT) and Heijunker principles to eliminate the Mura (unevenness) in the system. Bringing processes closer together with smaller batches and utilizing kanban systems.
This will require us to tackle the setup times to be able to make those improvements so we will have to implement SMED (Single Minute Exchange of Die) ideas to reduce setups to enable these smaller batches to become economical as well as physically achievable.
It is likely that you will be creating more than one version of the future state map, one being the ideal situation, the others being those accepting various limitations within the system that will have to be removed to make additional progress.
Moving to an Ideal State Map
Plan Implementation of Future State Value Stream Mapping
Once you have your future state map you need to plan to achieve this aim, you will never get there unless you actually plan your implementation. Without a full blown project implementation with full commitment from everyone in the company you will not reach your future state and gain the identified benefits. The future state map will detail the amount by which your lead times will be reduced, lower stock holdings, potential efficiency improvements and so forth so it should be possible to justify any project financially.
Projects that I have been involved in have reduced lead times from weeks to just a day or two or in one case from 3 months to one hour. We have also reduced stock holdings to as little as 5% of what companies were originally holding. Imagine how much cash would be released into your business if stock was reduced by 95%. These are just some of the benefits that can be realized through the use of value stream mapping within an organization.
Continuously Improve your Processes
Plan Do Check Act, Continually Improve your Value Stream Mapping
Also known as the Deming Cycle in many circles, Plan, Do, Check, Act is a simple model for improvement, you make your plan, you implement your plan, you check if you have achieved your stated aims and you then act to make any necessary changes. This cycle is repeated over and over again continually driving improvement. This is how you implement your Value Stream Mapping, it is an iterative process, one that you repeat over and over.
You make your initial current state map, plan your improvements, then make your improvements. Then you check your progress by creating a new current state map and plan additional improvements, your value stream mapping should be repeated to ensure continual improvement of your processes.
Value Stream Mapping Video
Value Stream Mapping Links
The following are useful links for business support and lean manufacturing resources.
Manufacturing Improvements Institute for Manufacturing
Quality Institute Chartered Quality Institute
American Quality Society American Society of Quality
Manufacturers Association American National Association of Manufacturers
Business Innovation and Skills Improvement UK Department for Business Innovation and Skills
Trade Improvement International Trade Administration USA
Lean Manufacturing Improvements UK Manufacturing Advisory Service
Business Improvements UK Business Link
US Business Improvement US Business Link
Motor Manufacturers and Traders Society of Motor Manufacturers and Traders
Automotive Industry Action Group Automotive Industry Action Group
These Links will help you to find more information regarding Lean Manufacturing and creating and acting on your value stream mapping (VSM) exercises.