Value Stream Mapping

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Value Stream Mapping

• BUSINESS MARKETINGProfessor William J. Qualls

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What is a Value Stream

• Value Stream Mapping is a tool used to create a
  material and information flow map of a product or
  processes. It allows firms to map the flow of
  products in the back door as raw material,
  through all manufacturing process steps, and off
  the loading dock as finished product.

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A Value Stream is......

• All the activities involved in creating value for
  the customer
• The process starts with raw material or
  information and ends with the end customer.
• The process involves functions both internal and
  external to the firm.

Source RD Production Logistics
Customer Service
Product or Service
Material and Information
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Why Value Stream Mapping is Useful

• Helps visualize interactions and flows of
  material and information
• Helps to identify types of wastes and sources of
  wastes.
• Shows the linkages between material flows and
  information
• Identifies the constraints---any resource whose
  capacity is less that customer demand

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Value-Added Activities

• An activity that transforms or shapes material or
  information
• Some that the customer wants or desires and
  willing to pay for
• Products, processes, or information that is done
  right the first time

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Non Value-Added-Needed Activities

• Activities that cause value not to be created but
  which cannot be eliminated based on current state
  of technology or thinking
• Required by governmental regulations or customer
  mandates
• Necessary

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Non Value Added Activities

• Activities that consumer resources but create no
  value in the eyes of the customer
• Pure waste
• If you can not get rid of the activity, it
  becomes a needed activity

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Types of Wastes

• Overproduction
• Waiting
• Transportation
• Inappropriate processing
• Unnecessary inventory
• Unnecessary motion
• Defects.

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Basic Steps to Value Stream Mapping

• Define the boundaries
• Define the value
• Identify the tasks and flows of material and
  information between them.
• Identify resources for each task and flow
• Create the current state map
• Identify value added and waste
• Reconfigure the process to eliminate waste
• Visualize the Ideal State and create future
  state map
• Develop Action plans and tracking

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Tips for Creating a Value Stream Map

• The process of value stream mapping should
  involve the whole team
• Actually walk the processfollow the material and
  information through the process starting at the
  beginning
• Use symbols or icons that are meaningful to the
  process but common enough to be understood by all
  stakeholders.

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Process Mapping

• The study of the flow of processes
• The identification of waste
• Consideration of whether the process can be
  rearranged in a more efficient sequence
• Consideration of a better flow pattern, involving
  different flow layout or transport routing and
• Consideration of whether everything that is being
  done at each stage is really necessary and what
  would happen if superfluous tasks wereremoved.

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Value Stream Mapping Tools

• Process Activity Mapping
• Supply Chain Response Matrix
• Production Variety Funnel
• Quality Filter Mapping
• Demand Amplification Mapping
• Decision Point Analysis
• Physical Structure Mapping
• Value Adding Time Profile
• Process Costing

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Building a Custom Jet Airplane-Current State

• Current State
• Number of Steps in the Process
• Number of Times materials or information is
  exchange
• Takt Time

• Future State
• Number of Steps in the Process
• Number of Times materials or information is
  exchange
• Takt Time

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Takt Time

• The rate of time required to complete a product
  to meet customer demand
• The customers buying rate determines Takt
  Time.Its the rate at which a customer buys the
  product
• Takt Time Net Available Time to Work
• Customer Demand
• Example 2 shifts x 7.5 hours x 60 minutes
• 145 planes
• 900 minutes/145 planes 6.2 minutes per plane

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Build a Jet Organizational Structure

• Purchasing Agent
• Manufacturing
• Quality control
• Customer Service
• Finance and Administration
• Team Leader
• Individuals can only perform one role at a time

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Customer Expectations

• Jet planes will be paper
• Each plane should have a paper clip on its nose
• There should be two gold stars on with one on
  each wing
• The company color logo for each division should
  be placed on the left side of the nose at the tip
  of the plane at the end of the paper clip. There
  should be an equal number of red, blue and green
  logos on planes delivered