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
Current State Drawing
Work Plan &
Implementation
Future State Drawing
Understand how the value
currently flows
Design a LEAN flow
Plan how to get there
and execute the plan
Define the Value Stream
Value Stream Step 1
Create a Matrix
1 2 3 4 5 6
AX X X X X
BX X X X X X
CX X X X X
DX X X
EX X X
FX X X X
P
r
o
d
u
c
t
s
Assembly and Equipment
A Product
Family
Create a matrix if your mix is complicated

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
Example
Material Flow
Information Flow
INVENTORY ICONS
WITH PUSH ARROWS
Customer
Start with the Customer
PROCESS BOX ICONS
DATA BOX ICONS
- C/T time
- C/O time
- Up time
- Scrap
28 days
15 sec
7.6
days
10
days
7
days
1.5
days
3
days
395sec 501 sec
150 sec 60 sec
PLT = 57.1 days
PT = 18.7 minutes
Time Line-PLT- Process Lead Time
PT- Process Time
Material Flow Icons
Assembly
XYZ
Corporation
Data Box
C/O=30 min.
C/T=45 sec.
3 Shifts.
2% Scrap
I
300 pieces
1 day
Inventory Supermarket
Shipment Push Finished Goods
to Customer
Physical
FIFO
First-In-First-Out
Process
Box
Supplier/
Customer
Mon
+ Wed
Pull
Information Flow Icons
Manual
Information Flow
Electronic
Information Flow
Weekly
Schedule
Schedule
OXOX
Load
Leveling Box
Sequenced-Pull
Ball
Withdrawal
Kanban
Production
Kanban
Signal
Kanban
Kanban
Post
General Icons
Uptime
Changeover
Kaizen
Lightning Burst
Operator
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.

State Street
Assembly
18400 pieces/month
-12000- L
- 6400- R
Tray = 20 pieces
Step 1
State Street
Assembly
500 ft coils
Michigan Steel
Company
VSM - Acme Exercise
Draw in process boxes and data.
Add a shipping box
Draw in the Inventory triangles and data
18400 pieces/month
-12000- L
- 6400- R
Tray = 20 pieces
Coils
5 days
I I I I I
I
Stamping
4600 L
2400 R
S. Weld #1
C/O=1 hour
1
1
1 1
S. Weld #2
Assy
#1
Assy
#2
1

Shipping
Staging
1100 L
600R
1600 L
850R
1200 L
640R
2700 L
1440R
C/T=1 sec
Uptime
=85%
27,600
sec. avail.
C/T=39 sec
Uptime =
100%
27,600
sec. avail.
C/O=10 m
C/T=46 sec
Uptime =
80%
27,600
sec. avail.
C/O=10 m
C/T=62 sec
Uptime =
100%
27,600
sec. avail.
C/O = 0
C/T=40 sec
Uptime =
100%
27,600
sec. avail.
C/O = 0
State Street
Assembly
Steps 2 & 3
State Street
Assembly
500 ft coils
Michigan Steel
Company
VSM - Acme Exercise
Draw in Customer and Suppliers delivery schedules and
method.

Steps 4 & 5
18400 pieces/month
-12000- L
- 6400- R
Tray = 20 pieces
2 shifts
Coils
5 days
I I I I I
I
Stamping
4600 L
2400 R
S. Weld #1
C/O=1 hour
1
1
1 1
S. Weld #2
Assy
#1
Assy
#2
1

Shipping
Staging
1100 L
600R
1600 L
850R
1200 L
640R
2700 L
1440R
C/T=1 sec
Uptime
=85%
27,600
sec. avail.
C/T=39 sec
Uptime =
100%
27,600
sec. avail.
C/O=10 m
C/T=46 sec
Uptime =
80%
27,600
sec. avail.
C/O=10 m
C/T=62 sec
Uptime =
100%
27,600
sec. avail.
C/O = 0
C/T=40 sec
Uptime =
100%
27,600
sec. avail.
C/O = 0
Tues. &
Thurs.
500 ft coils
1x Daily
State Street
Assembly
State Street
Assembly
Michigan Steel
Company
VSM - Acme Exercise
Put in production control and schedules
Draw in Information flows Internal and external
Step 6
Production Control
MRP
Weekly Schedule
Daily Ship
Schedule
Daily
Order
90/60/30 day
forecasts
6 week
forecast
Weekly
Fax
1x Daily
Tues. &
Thurs.
500 ft coils
Coils
5 days
I I I I I
I
Stamping
4600 L
2400 R
S. Weld #1
C/O=1 hour
1
1
1 1
S. Weld #2
Assy #1 Assy #2
1

Shipping
Staging
1100 L
600R
1600 L
850R
1200 L
640R
2700 L
1440R
C/T=1 sec
Uptime
=85%
27,600
sec. avail.
C/T=39 sec
Uptime =
100%
27,600
sec. avail.
C/O=10 m
C/T=46 sec
Uptime =
80%
27,600
sec. avail.
C/O=10 m
C/T=62 sec
Uptime =
100%
27,600
sec. avail.
C/O = 0
C/T=40 sec
Uptime =
100%
27,600
sec. avail.
C/O = 0
18400 pieces/month
-12000- L
- 6400- R
Tray = 20 pieces
2 shifts
State Street
Assembly
Weekly Schedule
State Street
Assembly
Michigan Steel
Company
VSM - Acme Exercise
Material flows between processes (push, pull, kanban)
Production Control
MRP
Daily
Order
90/60/30 day
forecasts
6 week
forecast
1x Daily
Tues. &
Thurs.
500 ft coils
Coils
5 days
I I I I I I
Stamping
4600 L
2400 R
S. Weld #1
C/O=1 hour
1
1
1 1
S. Weld #2
Assy #1 Assy #2
1

Shipping
Staging
1100 L
600R
1600 L
850R
1200 L
640R
2700 L
1440R
C/T=1 sec
Uptime
=85%
27,600
sec. avail.
C/T=39 sec
Uptime =
100%
27,600
sec. avail.
C/O=10 m
C/T=46 sec
Uptime =
80%
27,600
sec. avail.
C/O=10 m
C/T=62 sec
Uptime =
100%
27,600
sec. avail.
C/O = 0
C/T=40 sec
Uptime =
100%
27,600
sec. avail.
C/O = 0
18400 pieces/month
-12000- L
- 6400- R
Tray = 20 pieces
2 shifts
State Street
Assembly
Daily Ship
Schedule
Step 7
Weekly Schedule Weekly Schedule
Weekly
Fax
Michigan Steel
Company
State Street
Assembly
MRP
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
Production Control
MRP
Daily
Order
90/60/30 day
forecasts
6 week
forecast
1x Daily
Tues. &
Thurs.
500 ft coils
Coils
5 days
I I I I I I
Stamping
4600 L
2400 R
S. Weld #1
C/O=1 hour
1
1
1 1
S. Weld #2
Assy #1 Assy #2
1

Shipping

Staging 1100 L
600R
1600 L
850R
1200 L
640R
2700 L
1440R
C/T=1 sec
Uptime
=85%
27,600
sec. avail.
C/T=39 sec
Uptime =
100%
27,600
sec. avail.
C/O=10 m
C/T=46 sec
Uptime =
80%
27,600
sec. avail.
C/O=10 m
C/T=62 sec
Uptime =
100%
27,600
sec. avail.
C/O = 0
C/T=40 sec
Uptime =
100%
27,600
sec. avail.
C/O = 0
18400 pieces/month
-12000- L
- 6400- R
Tray = 20 pieces
2 shifts
Daily Ship
Schedule
Step 7
Weekly Schedule Weekly Schedule
Weekly
Fax
5 days
1 sec
7.6
days
1.8
days
2.7
days
2
days
4.5
days
40 sec 62 sec 46 sec 39 sec
PLT = 23.6 days
PT = 188 sec.
Acme Steering Bracket Line
3-15-2002
State Street
Assembly
Michigan Steel
Company
MRP
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
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
I
Outbox
1 Day
w
Waiting
1/2 Day at
meeting
I
Inbox
1 Day
Constructing Office Current State
State Street
Assembly
Customer
Make notes where you see
obvious Waste on the Map
Poor workplace
Organization
Re-enter Data:
Legacy System
Duplication:
Many Signatures
Paper Form Rework:
Incomplete Data
State Street
Assembly
Supplier
1 sales Rep
State Street
Assembly
Michigan Steel
Company
Customer
Customer
Central
database
Engineering
database
I
Outbox
2 files
1 Day
w
Waiting
1/2 Day at
meeting
I
Inbox
2 files
1 Day
I
Outbox
3 files
1 Day
w
Waiting
1/2 Day
Customer
I
Inbox
10 files
1 Day
I
Outbox
4 files
1 Day
w
Waiting
I
Inbox
2 files
1 Day
w
Waiting
1/2 Day
Purchasing
quote
I
Inbox
7 files
1 Day
Clarify
1 Day
I
Email /
voicemail
W
Meeting
3 hours
4 Estimates
.5 hours
Total 10 Days
Total CT 8 hrs 20 min
60 min 3 hrs 20 min 4 hrs 10 min
.5 hr 3 hr 1 Day .5 Day 1 Day 1 Day .5 Day 1 Day .5 Day 1 Day 1 Day 1 Day 1 Day

Order
Receipt

Manf.
Eng.

Eng.

Review

Quote
Prep

BOM
Validation
1 Sales Rep 1 Eng. 1 Eng. 1 sales Rep
Email
Quote
Design
Log file
Phone
Clarification
Email -
Clarification
EmailO
rder
Phone
Clarification
Phone
Clarification
Constructing Office Current State
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?