In this week's Series on Value Stream mapping we will look at the What, Why and How of Value Streams. Over the course of this week Lean Strategies International LLC will define what a Value Stream is and how Value Stream Mapping can assist in making the Value Stream more visual and we will talk about some reasons why Value Streams are such a powerful tool to use in any work environment. Finally we will give you one example of how a Value Stream map can be laid out.
To Start off we should define what a Value Stream is. A Value Stream includes all the steps both necessary and unnecessary steps that take a product from the early stages of a raw material or service to receiving the cash from the customer. We identify these steps as Value added and Non Value Added steps, this is why it is referred to as a "Value" stream, Some activities in the stream add value others just add waste.
There are in essence many different types of Value Stream maps, however the three most common that you will see are the Process Level map, Business or Organizational Map and finally the Extended VSM. A process level map would document activities in a specific department or a defined cell one example may be the way a purchasing department may release a purchase order if all the activities fall under that department it would be safe to say a process level map is appropriate to use. The next type of map that is used is the Business or Organizational Map, these types of maps commonly document activities that require the efforts of multiple departments in an organization. For instance if that same Purchasing process uses the efforts of planning, production, accounting and Program Managers it may be more appropriate to map the value stream with a Business type map sometimes referred to as a 3D VSM or Factory VSM. The final type of Value Stream Map is the Extended VSM, these types of Maps generally show the entire system across multiple organizations.
Let's Look at one Example of a Value Stream that may help us to understand the Value Stream a little bit better. You and I are going to eat some Taco's. We will define the Value Stream at the Process level. First- We Stand in Line to Order our Taco's Second- We place our order Third- We wait for them to check that they have everything they need Fourth- They confirm Fifth- They fix the Taco's Sixth- we receive the Taco's and Seventh- we eat the taco's
You Can probably tell by this example which activities are value added to a Customer and Which activities are not. When the Value Stream becomes visual we now have a Value Stream Map, which identifies or Map's out the activities performed in the Process.
This is a very basic example of a Value Stream map, We are sure that more details could log much more savings, but let's dig a bit deeper here. As you can tell the (Muda) or Non-Value added portion of the Value stream takes up a significant portion of our Taco trip. This is very common in Work environments too, Infact if it's the first time you have documented your value stream it is not uncommon for the Non-Value to be almost 75-80% of your Value Stream.
This brings us to our next point What we tend to do is press on the Value Added portion of the Value stream, which not only is what the Customer wants to pay for but often times will yield only seconds in savings (i.e. running machines faster than they can handle, pushing employees, unbalanced workloads) and more often than not yields broken machines or disgruntled employees. But as you can tell if we focus on the Non-Value added portion of the Value Stream and Eliminate waste we can often yield much larger results.
Hopefully you are beginning to understand the possibilities and power a Value Stream Map can bring to your Lean Strategy. Tomorrow We will look at some examples of Why you would use a Value Stream map including moving from the Current state to the Future State.
Over the years many tools have been used to "discover" solutions or decide on the best possible tactic to move forward. One of m favorite tools to use is the Cause and Effect Matrix. There are many tools that can help you decide what inputs should be applied to a process but The solution matrix seems to work very well for engaging teams, It in many ways forces teams to engage the "Gemba" and creates interdepartmental teamwork. There are a few crucial steps that need to be captured when using a cause and effect matrix; In hopes that you will better understand the process, here is one example of a basic Cause and effect matrix.
The example shown above is just one basic example you can make them whatever way works best for you though. Typically the C&E matrix is used to help hone in on the best possible Inputs (shown in grey) that will give you the best possible impact. There are 5 basic steps that will make this tool work for you;
1. Identify what is important to the Customer
- As with anything else we want to understand what is important to the Customer. One example may be a customer buying a hamburger; It may be important to them to have the hamburger well done, made correctly and for the hamburger to fill them Up. Those things that are important are known as the "Voice of the Customer." We place those items in the Red section.
Now that we have identified what is important to the Customer we can move on to the second portion of the Cause and effect matrix.
2. Prioritize What is Important to the Customer
This is a good time to ask the Customer, which one of these is most important to you? Try to limit the priority numbers but common sense tells us if there are 10 important things to a customer your scale will be 1-10. Since in out Hamburger case only 3 things are important we will use a scale of 1-3. This is a great time to really understand your customers priorities and more importantly why.
Well now that we know what is Important to the Customer and just how important it is amongst the other suggestions we can begin to load in our Inputs. These are the ideas/variables that transform in the process to create the Outputs.
3. Document and Identify Process/Product Inputs
At this point you may have a Value Stream Map, SIPOC Map, or a process documented one way or another. You can identify some of the inputs in the Map on your Cause and effect Matrix or you may wish to simply visit the Gemba and speak with process owners. Whatever way you choose to get the inputs we will place them in the Grey Section.
Now you can see that after speaking with the process owner we came up with four ideas. This is where the Cause and effect Matrix will become your best friend..... Which one do you do?
4. Rank How effective the Inputs are on the Outputs
Now we are ready to rank how effective the Inputs are on the desired customer Outputs. You can use any scale you want but be sure to make it quantifiable. For our Purposes I will use a scale of 1-5, 1(no impact) 2(minimal Impact) 3(Impact) 4(Good Impact) 5(Perfect Impact).
That brings us to the Final Step.
5. Do the Math and act on the Best Percentage
After doing the Math it looks as though our biggest impact input is to Create a Standard for making the burger. Keep in mind this does not mean that the others are any less important or won't yield some result it just simply means that with minimal resources and a budget in place, Item number 2 would be the first to act on.
As you can tell the Solution matrix is a very efficient way of making opinions quantifiable. If you are interested in how you can create your own solution matrix or want a copy of the one used in this article please feel free to email us at email@example.com.
A Job Shop is typically a small sized manufacturer who runs custom and semi-custom work. They may have repeat orders but more often than not Job shops take "the hard to engineer" stuff and make it. Now, certainly having flexibility allows for the research and design of new products but a common struggle in the Job Shop world is a combination of Product Variability, Scheduling and resource utilization. So how does Lean Solve these common issues?
Lean Focuses on the process instead of the person or the part. Certainly making a good part is good and will yield positive results for any organization but the concept is "The right process will produce the right result" every single time. For this reason defining the results that you want is very important, then we can look at how the value stream get's you there. Let's look at some common "results" in job shops.
The Setup (spend less time)
Job Shops are often times the ones making very intricate parts and have a somewhat "intermittent" environment to begin with, for this reason a job shop can really benefit from Setup reductions. In a Job shop a lot of time is spent just setting up the various components of a job so that you can run it. Then you avoid changeover so that you don't have to to "Set-up" again. 50 some odd years ago these ""Set-ups" may have been okay but as the need to streamline parts and be competitive at a global level has developed customers are not always willing to pay the set-up anymore. SMED and set-up reduction is a great skill for the people on the machines to master, infact..... Throw away the belts, yes we said it throw away the belts and teach your front line force to see and identify waste, differentiate between value and non value and reduce setup times and you will see some huge results.
Teach the Frontline to see the difference?
The major difference is seeing and differentiating Value from its non-value counterparts. In a Job shop when the part is on the machine and running it is still yielding value just like a part in a production shop. But how about the queue, wait and move? Were not hinting at anything here, well yes we are but in a Job shop identifying non value can be powerful. You will find as you walk through any Job shop environment that a good place to start your lean journey (like many other manufacturing environments) is removing the waste from Processes and Systems. If everybody in the Shop knows the elements of Value and Non-Value and the proper way to map their Processes or Systems you will have a much better shot at improving your business overall. Keep in mind we used the words systems and processes above. Those two words indicate that yes there is a material flow but more importantly you will find Information flow to be a major improvement opportunity in a Job shop, most likely those opportunities with Information flow will yield much bigger results than the material flow.
Be aware of Differences and Similarities
Although Much of the Tactical side of Lean's strategy is the same there are some pieces of a Job shop puzzles that need experience and have to be molded very finely. For instance you may wish to use elements of Just-In-Time pillar like Kanban system. A Kanban system can act as a trigger rather than jumping straight into continuous flow (which varies by product). Although Some elements of a Job Shop are clearly different than a Production environment, Waste no matter how you look at it is still waste and can still be treated in much the same manner. In a Job shop finding solutions for the Mura origin of waste becomes much more critical to seeing results. This will require Level loading/heijunka type applications. Keep in mind you may never obtain a perfectly leveled "job shop" but the improvements you will find in the leveling realm will certainly place a smile on your face.
In Short, Lean in a job Shop is just as effective as a production environment. Although the forms of waste will be unique in there own respect, that is the same in all organizations. Along with Increased Capacity, Reduced Manufacturing times and improved utilization of Assets Job Shops will often be able to do much, much more with far less resources when jumping into a Lean Strategy. Overall seeing a Sleek streamlined and efficient job shop truly is a beautiful site and all though you may not see it at first glance you can bet that there are elements of Lean in many Job Shops.
In Closing, Is Lean for a Job Shop? You better believe it.
We have all heard the term "Lean Culture" and there are many different ways to define this unique sort of culture that everyone dreams about. But first let's start off by addressing the question "why is culture so important?"
Culture does many things in the environment it overlays, one of the main reasons we speak so often about Culture is that it assists us in Survival. You see Culture makes us unique and with out it everyone acts and behaves rather differently. Now we all know that we have our unique personalities and skills which make us who we are but Culture helps us to understand why someone behaves the way they do. Often times when the culture is not defined a company's performance would be rather "lumpy".
Now, please don't misinterpret the "defined culture" infact it is rather important that the culture of a company is flexible and adaptable, why you ask? When a Culture is adaptable it is better able to change. If the environment changes the culture to must change to meet the needs of the environment it is now in. Now this sort of change is not a guarantee to any organization's survival what it is though is a much better chance at your survival.
Let me focus in a bit more on some aspects of a lean culture, although this may sound odd or unrealistic but the traditional "Plant Manager" may have a general idea of what is going on in his plant, but general ideas do not really define the culture of lean. The fact is the traditional Plant manger is usually troubled by:
1. Poorly defined Goals and objectives
2. Changing philosophies
3. Almost no time on the floor
4. Poor Quality, Capacity, and On Time Delivery
These are problems that need to be solved, true, but the environment that they create is reactive which then creates a culture of the famous "firefighting." In a Lean Culture it seems odd but the goal is awareness. That awareness is around many different things, such as problems, waste, solutions, and performance. You can pick the measure but the concept is aware. Taiichi Ohno once said; "The work place is motivated by; Mutual survival, appreciation for excellent work in itself."
In a Lean environment that is what people do they support one another in surviving. That support is focused on both internal and external customers but none the less it is support. A truly lean culture focuses not just on the elimination of waste but on the survival of each other.
Here are a few things you can do help each other Survive;
1. Put the Customer first, We have all heard the saying "the customer is always right" but what we are talking about is putting the customer first. There is no specifics to putting the customer first just simply understanding their needs, doing everything you can to meet those needs and understanding there is often times more than one customer.
2. Create and Support Kaizen.
3. As a Leader Support appropriate Culture, Now don't mistake this statement, leaders come at many different levels of an organization..... We are all leaders in one way or another, but notice it does not say "define" culture only "Support" or drive appropriate culture. This can be done through clearly defining roles, responsibilities, expectations and set through examples and recognition of those who stand out. As a side note be aware that how you reward and punish people will impact the company culture too. When you support appropriate culture you understand the environment and what the people need to survive; their values, their traits and what is important to them. At times you may need to pivot but supporting appropriate behaviors can in turn support appropriate cultures.
As you travel along in your own personal Journey, whether in life or a lean strategy remember to help another survive and be a constant example of what it means to help and support the culture you hope for. This in turn will allow you and your Organization to survive in any environment, even if the seas get a little stormy.