Value Stream Analysis and Mapping for Project Management

Value Stream Analysis and Mapping (VSA/M) is a tool for business process improvement. Value Stream Analysis (VSA) is a method that implements lean principles for the examination of business processes. The tool, focus on the development of tasks which add value to the final product, efficiently linked together to form a continuously flowing stream of value.

History

In order to understand its origins we must look back into the early 40s. By then, Toyota was trying to compete with the American automobile market by productivity means. Taiichi Ohno in 1956 traveled to the US in order to visit the automobile plants and see how could he improve its production system back in Japan. Despite what he saw on those production plants, what catches his attention is the self-service supermarkets in which he could choose exactly what he wanted and how much of it. That idea was efficient as well as timely saver for him and where to become later the fundamentals for pursuing manufacturing improvements. Along the next years Ohno will develop this production system on a systematic framework based on Lean and Just-In-Time principles. Toyota defined six elementary rules:

• Never send defective products downstream to the next process
• Each process only orders what it currently needs from the upstream process
• Each process only produces the quantity ordered by the downstream process
• Maintain a level rate of production
• Use Kanban to fine-tune the rate of production
• Work to reach a stable rate of production

These first studies where focused mainly on manufacturing processes in spite of process design. But the principles can still be applied either to shop floor and non-shop floor activities. And as Womack and Jones describe it, the main principles of lean for product development are:

• Value: providing the customer with the right product, for the right price, at the right time.
• Value Stream: the set of actions that bring a product from concept to realization, order to delivery, or raw material to finished good
• Flow: seamless movement through value-creating steps.
• Pull: acting only to satisfy customer needs, rather than forcing, or pushing, a product upon the marketplace.
• Perfection: continuously and relentlessly improving the value, value stream, flow, and pull in business operations.

Methodology

The value stream must be analyzed and mapped thoroughly to reduce waste along processes and enable flow. Also to move the processes towards a more rapid response for customer pull. On a product development context, this means rapid response towards customer needs when it comes either to new products or permutations of the existing ones.

On a manufacturing environment

Fundamentally, the method consists on mapping the current state of the process and apply lean techniques. This enables an improved future state of the process. In order to do so, non-value-added tasks are identified. Then, the tasks considered to support the true value-added tasks such as, set-ups, reviews, etc..., are Type I waste. While completely unnecessary tasks such as waiting in the inventory are Type II waste. A number of techniques are then applied once cathegorised these types of waste. Which in the lean manufacturing pcontext include manufacturing cells, Just-In-Time deliveries, aparts supermarkets, etc... Once established the future state map, it is implementet thorough a plan. Which leads to a an improved state that ideally is used to generate further future states. As seen, the process is being continuously improved.

On a Program Management environment

According to the product development team at MIT's Lean Aerospace Initiative, the value of the Product Development (PD) process is "a capability delivered at the right time, for the right price, as defined by the end user." Now this value stream is effectively emboided on a notional product designed package. Therefore, as the outcome of a value stream it can be evaluated as a PD value stream, like the manufacturing value stream is done. This way fitting with other activities around the business cycle to define an overall value as we can see on the Figure 1.

Figure 1: PD Value Context - Source:

In order to extrapolate the VSM under manufacturing principles to a Program Management environment, how does the flow thorough the PD process translates into? In this case it is information. Information flows thorough the PD process like on the manufacturing environment material does. The quality of the information flow is characterized by its Form, Fit, Function and Timelines (FFFT). However, PD value not only comes as a function of the FFFT within the design package, it also comes as the degree the design package allows the end product to match the desires of the customer.

As information flows through the PD process, tasks add value to the information. Since the flows in PD are made of information instead of physical materials. Using the next seven info-wastes should enable to identify wastes associates with the information flows:

Types of Information Waste	Examples	Causes
Waiting Idle time due to unavailable information	People waiting for information	Lack of access Untimely updating of data bases Multiple approvals Poorly designed or executed process to provide information
Waiting	Information waiting for people	Information created too soon may be obsolete by the time it is used
Inventory	Too much information	Poor understanding of user needs
Inventory	Multiple/redundant sources	Tendency for everybody to maintain their own files
Inventory Information that is unused or is “work in progress”	Outdated/obsolete information	Lack of “version control” Lack of disciplined system for updating new and purging old information Inadequate archiving standards or practices
Inventory	“Just-in-case” information	Collection, processing and storage of every element of data that process participants can think of, whether or not a specific end use has been identified
Excessive Processing	Excessive/custom formatting	Lack of standardization
Excessive Processing Information processing beyond requirements	Numerous, fragmented reports	Poor output design Lack of understanding of the needs of the users of process outputs
Excessive Processing	Unnecessary serial processing	Poor system design Lack of understanding of concurrent processing capabilities
Excessive Processing	Excessive approvals for information release	Stove pipe, command and control mentality Turf protection
Over Production Producing, distributing more information than needed	Unnecessary detail and accuracy	Tendency to “over-design” More detail than necessary in early design
Over Production	Pushing, not pulling data, information	row 2, cell 3
Over Production	Over-dissemination	row 2, cell 3

Discussion

Value Stream Mapping can be thought as a tool which facilitates the transformation from a traditional manufacturing company to a Lean Enterprise. It is a planning tool to target ideal processes and roadmaps to desired improvements.

Related Articles

The lessons from Toyota for product development had been captured by Fujimoto and Clark and Ward and Sobek. Follow the references for further study.

Most of the VSM work that has been acomplished is around the manufacturing context. For practical implementation of VSA/M on manufacturing operations please refer to .

Understanding how to break the PD process down into stages: