What is a value stream map and how do businesses benefit from them?
Updated: Jan 17
Value Stream Mapping (VSM) is a Lean technique used to provide a snapshot of the current state of processes within an organisation. It involves the creation of a ‘value stream map’ depicting the key people, resources, activities, and information flows required to provide a product or service to a customer.
VSM enables organisations to visualise how end-to-end processes work, evidence actual performance, and identify opportunities for process improvement. For these reasons, it’s often carried out at the outset of a Lean improvement programme.
Organisations across a variety of industries can benefit from VSM. It has been proven to be effective in engineering, IT, financial, HR, legal and marketing services, as well as in service industries such as healthcare. Taking legal services as an example, an obvious application for VSM is mapping.
Take a look at this illustration of how a simplified version of the Value Stream Mapping can be used to answer a number of questions:
Where should we focus our efforts to reduce the overall processing time?
Take a look at the wait time between print order details and contract T&Cs approval of 10 days. The approval takes 60 mins, but there is a 10 day wait time.
Where can we reduce the labour time to process orders?
Take a look at the cycle times (CT) that represent labour time to process each task. The contract T&Cs approval tasks takes 60 minutes.
What does that step involve? Can the task be reduced or eliminated?
Helps identify waste
Visualising a process from start to finish helps to illuminate non-value adding activities, or ‘waste’.
Non-value adding activities are those that consume time or resources but do not add value to customer requirements. In other words, the customer gets nothing out of it. Examples could be creating multiple copies of the same document, duplicating process steps in different departments, unbalanced workloads, or unnecessary movement of parts, materials, files or documents.
Once waste has been identified, it can be removed from the process to make it more efficient.
Helps identify bottlenecks
A value stream doesn’t solely look at the activities involved. It also looks at the information flows and takes the people side into account by looking at who’s responsible at certain points of the process, and where managerial input is required.
For instance, it could be that in a finance department all invoices need final sign off by the Finance Director. But if they are having to check more invoices per day than they have the capacity, they become a bottleneck.
If your organisation has been doing things the same way for a long time, it can be difficult to see where bottlenecks are occurring. Taking a step back and creating a value stream map will help bring them to the surface. Bottlenecks can then be removed to create flow. In the example of the finance department, another senior team member could be appointed as an additional source for sign off.
Aligns cross-functional teams
VSM is a team exercise. While it should be led by someone trained in Lean tools and techniques, it should involve people from all areas of the process being mapped.
By involving cross-functional teams, you open people’s eyes to more than just their own perspective. Understanding the roles of other people in the business along the process creates an appreciation of what others are doing and how your roles interact.
And, seeing the full picture of what it takes to provide a customer with a product or service gets everyone on the same page and working towards a common goal.
Brings process improvement to the forefront
Involving the workforce in value stream mapping brings process improvement to the forefront. It starts the conversation around what parts of the process work well, and what areas could be made easier or more efficient.
Your people know the process best, so even if they’ve never raised frustrations or ideas for solving them before, they’re bound to have some opinions. Creating a value stream map opens up a forum for them to share their views. It becomes a central piece to hold conversations around.
Lean is about more than just eliminating waste and driving efficiency. It’s about building a culture of continuous improvement, and VSM can be an effective first step.
It’s inexpensive and fairly easy to do
A value stream map can be created with pencil and paper, or with wall space and post-it notes - ideally somewhere in the working environment where it’s visible for all to see.
It doesn’t need to be a glorious work of art or a technical masterpiece. The most important thing is for it to be fluid. You’ll want to rub things out or move post it notes around along the process of mapping the value stream.
But, be sure not to skimp on the details or short-cut the process. Dig deep and leverage the knowledge and experience of your workforce until you can be sure your value stream map accurately and completely describes the current process.
VSM is a powerful technique for visualising processes and identifying areas for improvement. It comes down to this: a process can only be improved once it’s fully understood, and understanding a process is easier with visualisation. By involving your workforce you also open up the conversation of process improvement and align teams to the same goal - delivering a quality and efficient product or service for customers.
Get in touch
If you would like additional guidance on how to best utilise VSM for your business, get in touch.