Engineering

Management

MSE507
Lean Manufacturing

Chapter 2
The Value Stream
"Whenever there is a product for a customer, there is a
value stream. The Challenge lies in seeing it
PHILIP (PHIL) M. CONDIT
Chairman and Chief Executive office
The Boeing Company

"There is only one boss: the customer. And he can

fire everybody in the company, from the chairman
on down, simply by spending his money
somewhere else."

Samuel M. Walton
Wal-Mart Stores, Inc.
Chairman & Chief Executive Officer

Why Map A Value Stream?

Lean Manufacturing is:

the relentless elimination of waste

Waste is using resource

without adding value

Waste is all around us, but it can be very hard to see

Value Stream Maps (VSM) help us see waste

Value Streams

A Value Stream is the entire set of activities running from raw

material to finished product for a specific product or product
family

In a typical enterprise, value streams can intersect with other

value streams, branch apart or Y together

Value Stream Maps

Value Stream Maps are powerful visual tools to help see waste
and understand the flow of material and information
Especially powerful for illustrating the wastes of Overproduction,
Idle Material & Transportation

Value Stream Maps show all actions required to deliver a

product
Value Addedas well as
Non-Value Added

Other Benefits Of VSM

Provides a big picture perspective that helps focus on improving
the whole process, not just optimizing bits and pieces
Shows the linkage between the information flow and material
flow
Helps to see across the functional boundaries over which a
products value stream flows

Other Uses For VSM

To help understand how your business actually works
(you dont understand the current process if you cant draw it)
A tool for establishing a vision and implementation plan for a
new business or product line
A visual tool and common language for talking to others about
your manufacturing process

Mapping Process
Product Family

Define the Value Stream

Current State Drawing

Understand how the value

currently flows

Future State Drawing

Design a LEAN flow

Work Plan &

Implementation

Plan how to get there

and execute the plan

Value Stream Step 1

Create a Matrix

Create a matrix if your mix is complicated

Assembly and Equipment

1
2
3
4
5
6
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X

P ro d u c t s
FEDCBA

A Product
Family

A Reminder
The point of value stream mapping is not the
maps, but to understand the flow of information
and material and see waste
...and then use that understanding and insight to
improve your process

IMPLEMENT FUTURE STATE!

Engineering
Management

Value Stream Mapping

Current State Maps

(CSM)

The Current State Map

A pictorial view, drawn with pencil and paper while observing the
process on the factory floor, that shows how material and
information currently flow
Creates a baseline for future improvements to be measured
against
Clarifies understanding of how the current production system
actually operates

Information Flow

Example
Customer

Start with the Customer

INVENTORY ICONS
WITH PUSH ARROWS

Material Flow

PROCESS BOX ICONS

DATA BOX ICONS

- C/T time
- C/O time
- Up time
- Scrap

Time Line-PLT- Process Lead Time

PT- Process Time
7.6
days

28 days
15 sec

10
days
60 sec

7
days
150 sec

1.5
days
501 sec

3
days
395sec

PLT = 57.1 days

PT = 18.7 minutes

Material Flow Icons

Assembly
XYZ
Corporation
Process
Box

Supplier/
Customer

C/T=45 sec.
C/O=30 min.
3 Shifts.
2% Scrap

300 pieces
1 day

Data Box

Inventory

Mon
+ Wed
Shipment

Supermarket

FIFO
Push

Physical
Pull

Finished Goods
to Customer

First-In-First-Out

Information Flow Icons

Manual
Information Flow

Withdrawal
Kanban

Electronic
Information Flow

Production
Kanban

Weekly
Schedule

OXOX

Schedule

Load
Leveling Box

Signal
Kanban

Sequenced-Pull
Ball

Kanban
Post

General Icons

Uptime
Changeover

Operator

Kaizen
Lightning Burst
Buffer or
Safety Stock
Go See
Production
Schedule

Value Stream Map - Acme Exercise

(Use the Handout Data Sheet)
Use a pencil and small Post-it notes on 11 x 17 paper.
Use the following colors

BLUE - Process
YELLOW - Inventory (tear in half)
PINK - Master schedule / Production control
GREEN - Supplier & Customer

Fill in a Post-it notes for each process/data and symbol

Remember Always start with the Customer

Build the map, leave enough room between process boxes to
show inventory and enough space on the bottom to draw the
time line

VSM - Acme Exercise

Draw in Customer and Suppliers data.

Step 1
State
StateStreet
Street
Assembly
Assembly
Michigan Steel
Company

18400 pieces/month
-12000- L
- 6400- R

500 ft coils

Tray = 20 pieces

VSM - Acme Exercise

Draw in process boxes and data.

Add a shipping box

Draw in the Inventory triangles and data

Steps 2 & 3
State
StateStreet
Street
Assembly
Assembly
Michigan Steel
Company

18400 pieces/month
-12000- L
- 6400- R
Tray = 20 pieces

500 ft coils

Stamping

I
Coils

I
1

4600 L

S. Weld
#1

2400 R

5 days

C/T=1 sec
C/O=1 hour
Uptime
=85%
27,600
sec. avail.

S. Weld #2

I
1100 L

1600 L

Assy
#1

850R

600R

C/T=39 sec

C/T=46 sec

C/O=10 m

I
1200 L

Assy
#2

2700 L
1440R

640R

C/T=62 sec

C/T=40 sec

C/O=10 m

C/O = 0

C/O = 0

Uptime =
100%

Uptime =
80%

Uptime =
100%

Uptime =
100%

27,600
sec. avail.

27,600
sec. avail.

27,600
sec. avail.

27,600
sec. avail.

Shipping

Staging

VSM - Acme Exercise

Draw in Customer and Suppliers delivery schedules and

method.

Steps 4 & 5
StateStreet
Street
State
Assembly
Assembly
Michigan Steel
Company

18400 pieces/month
-12000- L
- 6400- R
Tray = 20 pieces

500 ft coils

2 shifts

Tues. &
Thurs.

1x Daily

Stamping

I
Coils

I
1

4600 L

S. Weld
#1

S. Weld #2

1100 L

2400 R

5 days

C/T=1 sec
C/O=1 hour
Uptime
=85%
27,600
sec. avail.

I
1

1600 L

Assy
#1

850R

600R

C/T=39 sec

C/T=46 sec

C/O=10 m

I
1200 L

Assy
#2

I
2700 L
1440R

640R

C/T=62 sec

C/T=40 sec

C/O=10 m

C/O = 0

C/O = 0

Uptime =
100%

Uptime =
80%

Uptime =
100%

Uptime =
100%

27,600
sec. avail.

27,600
sec. avail.

27,600
sec. avail.

27,600
sec. avail.

Shipping

Staging

VSM - Acme Exercise

Put in production control and schedules
Draw in Information flows Internal and external

Step 6

90/60/30 day
forecasts
6 week
forecast

Michigan Steel
Company

Production Control
Daily
Order

Weekly
Fax

500 ft coils

State
StateStreet
Street
Assembly
Assembly
18400 pieces/month
-12000- L

MRP

- 6400- R

Daily Ship
Schedule

Weekly Schedule
Weekly Schedule

Tues. &

Tray = 20 pieces
2 shifts

1x Daily

Thurs.

Stamping

I
Coils

S. Weld #1

I
1

4600 L

I
1

2400 R

5 days

Assy #1

S. Weld #2

1100 L

1600 L

I
1

850R

600R

Assy #2

1200 L

Shipping

2700 L

Staging

1440R

640R

C/T=46 sec
C/O=10 m
Uptime =
80%

C/T=62 sec

C/T=40 sec

C/O=1 hour
Uptime
=85%

C/T=39 sec
C/O=10 m
Uptime =
100%

C/O = 0
Uptime =
100%

C/O = 0
Uptime =
100%

27,600
sec. avail.

27,600
sec. avail.

27,600
sec. avail.

27,600
sec. avail.

C/T=1 sec

27,600
sec. avail.

VSM - Acme Exercise

Material flows between processes (push, pull, kanban)

Step 7

90/60/30 day
forecasts

Production Control

6 week
forecast

Michigan Steel
Company

Daily
Order

Weekly
Fax

500 ft coils

State
StateStreet
Street
Assembly
Assembly
18400 pieces/month
-12000- L

MRP
MRP

- 6400- R

Weekly
WeeklySchedule
Schedule

Tues. &

Tray = 20 pieces

Daily Ship
Schedule

2 shifts

1x Daily

Thurs.

Stamping

I
Coils

S. Weld #1

I
1

4600 L

C/T=1 sec

I
1

2400 R

5 days

Assy #1

S. Weld #2

1100 L

1600 L

C/O=1 hour
Uptime
=85%

C/T=39 sec
C/O=10 m
Uptime =
100%

27,600
sec. avail.

27,600
sec. avail.

I
1

850R

600R

Assy #2

1200 L

I
1

1440R

640R

C/T=46 sec

C/T=62 sec

C/T=40 sec

C/O=10 m
Uptime =
80%

C/O = 0
Uptime =
100%

C/O = 0
Uptime =
100%

27,600
sec. avail.

27,600
sec. avail.

27,600
sec. avail.

2700 L

Shipping
Staging

VSM - Acme Exercise

Draw production lead time/value-added timeline
Calculate production lead time for inventory triangles by
dividing quantity of inventory by the customer daily requirement

This is a really neat trick! It turns a count of inventory into the

number of production days that inventory represents
Stamping / Weld
18,400 pieces/mo / 20 days = 920 pieces/day
920 / 16 hours (2 shifts) = 57.5 pieces/hour
7000 pieces (total Inv.) / 57.5 pieces/hour = 121.7 hours of Inv.
121.7 hours of Inv. / 16 hours = 7.6 days of Inventory
Finish the rest of the calculations.

What is the inventory production lead time?

Title and date the map

Step 7

Acme Steering Bracket Line

90/60/30 day
forecasts

3-15-2002

Production Control

6 week
forecast

Michigan Steel
Company

Daily
Order

Weekly
Fax

500 ft coils

State Street
Assembly
18400 pieces/month
-12000- L

MRP
MRP

- 6400- R

Weekly
WeeklySchedule
Schedule

Tues. &

Tray = 20 pieces

Daily Ship
Schedule

2 shifts

1x Daily

Thurs.

Stamping

S. Weld #1

I
1

Coils

4600 L

C/T=1 sec

5 days

27,600
sec. avail.
1 sec

1100 L

7.6
days

1600 L

27,600
sec. avail.
39 sec

1.8
days

Assy #2

I
1

850R

600R

C/T=39 sec
C/O=10 m
Uptime =
100%

C/O=1 hour
Uptime
=85%

2400 R

5 days

Assy #1

S. Weld #2

1200 L

I
1

C/T=62 sec

C/T=40 sec

C/O=10 m
Uptime =
80%

C/O = 0
Uptime =
100%

C/O = 0
Uptime =
100%

46 sec

2.7
days

27,600
sec. avail.
62 sec

2
days

2700 L

Staging

1440R

640R

C/T=46 sec

27,600
sec. avail.

Shipping

27,600
sec. avail.
40 sec

4.5
days

PLT = 23.6 days

PT = 188 sec.

The Office

Office functions support many shop floor value streams purchasing, payroll
The rate of customer demand is often hard to see
Inventory can be forms, paperwork, in-baskets, out-baskets,
voicemail, email
Cycles of activity often are random - little standard work
Confusion about who the customer is and what is value

The Office

HOWEVER, THE
OBJECTIVE IS TO
ELIMINATE WASTE!

The Office Current State

Define boundaries of your value stream
There has to be a product or service to follow - like a
purchase order or payroll document - otherwise use a normal
flowchart (LEI)

The Office Current State

What capability do you provide?
Is the demand stable?

If not, what is the range ?

What is the customers expectation of performance?

Constructing Office Current State

Outbox

Waiting

Inbox

1 Day

1/2 Day at
meeting

1 Day

Waiting should be recorded if there is no apparent end takt

time and the next process is far away
Use Cycle Time of customer process to understand total lead
time

Constructing Office Current State

State Street
Assembly
Supplier

Make notes where you see

obvious Waste on the Map

Poor workplace

Duplication:

Organization

Many Signatures

State Street
Assembly
Customer

Re-enter Data:

Paper Form Rework:

Legacy System

Incomplete Data

Constructing Office Current State

Michigan Steel
Customer
Company

EmailO
rder

Engineering
database

Central
database

Phone
Clarification

State Street
Assembly
Customer

Phone
Clarification

Email
Quote

Design

Log file
Phone
Clarification
Email /
voicemail
I

Order Outbox Waiting

Receipt
W

4 Estimates Meeting
.5 hours 3 hours

.5 hr

Inbox

Waiting

2 files 1/2 Day at 2 files

meeting
1 Day
1 sales Rep1 Day
1 Eng.

1 Day .5 Day

3 hr

10 min

Inbox

Review

1 Day

1/2 Day
Purchasing 7 files
1 Day
quote

BOM Outbox Waiting

Validation
I
w

1 Sales Rep

.5 Day 1 Day

4 hrs

3 files
1 Day

Inbox

Manf.
Eng.

1/2 Day 10 files

Customer 1 Day

1 Eng.

1 Day .5 Day 1 Day

3 hrs

Email
-Clarification
Outbox Waiting Inbox
w

4 files Clarify
1 Day 1 Day

Quote
Prep

I
2 files
1 Day 1 sales Rep

1 Day 1 Day 1 Day

60 min

Total 10 Days

20 min

Total CT 8 hrs 20 min

Mapping Tips

Use Colored Post-it notes paper for Mapping

(Easier to move Post-it notes than redraw)

Use roll of butcher paper so you can use a wall and see the
whole VSM
Use string or ribbon to show material & information flows
Decide whether to count all parts or sample

Mapping Tips
Best to map production lines between
Tuesday and Thursday
Use someone from the line or process to walk you through it
first, post-it note process, come back and get
Real Data and Times
If you plan on using the times to balance your process then do
not take shortcuts - you will be way off
(Embarrass yourself!!)

See with your hands. No Armchair Lean!

Mapping Steps
Gather customer information
Get with the process owners and talk / draw - through the

process sequence and capture the sequence on a Post-it note

Walk the process - Post-it note process boxes (up versus down
stream?)
Fill in data boxes and inventory levels. (Get Real Times)
Document how goods are delivered to the customer
Gather supplier information
Add information flows
Sketch how material moves between processes.
Draw production lead time/value-added timeline

Mapping Tips

Calculate production lead time for inventory triangles by dividing

quantity of inventory by the customer daily requirement
This is a really neat trick! It turns a count of inventory into the
number of production days that inventory represents

Add a title and date the map

Homework Assignment

Questions:
1. Use slide 30 as a template and construct a value stream of
your choice (product or service)
2. Explain the advantages and possible disadvantages of
using Value Stream Maps to improve the business

Read Lean Thinking Chapter 3 - Flow

Pages 50 - 66

Questions? Comments?