Increasing performance with Value Stream Management

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Contents

Abstract

This article describes Value Stream Management and how it can help to optimization of supply chain network and hereby ensuring a high level of customer satisfaction. In continuation of Value Stream Management, a definition of Value Stream and a description of the tools Value Stream Storyboard and Value Stream Mapping (VSM) will be introduced. The article will dive into Value Stream management approaches of delivering value and streamlining the workflow. This will include a walkthrough of the theory behind Value Stream and the lean tool of VSM. Along the article, Lean philosophy will be descripted to some degree. The application of Value Stream Management will be discussed, and a guidance of the tools Value Stream Storyboard and VSM will be given. Lastly the article will deliver a reflection on the challenges which Value Stream Management faces, when it comes to developing and maximizing value for both company and business. This reflection will also touch on the benefits and disadvantage of value stream management. The article should in some sense give an understanding of how to use Value Stream Management and also apply it, so it is easier to get products out the door. [1] [2] [3]

Agile aspect – state of the art

Today ‘s modern businesses require a lot of agility due to for example digital transformation, higher business complexity and especially after Covid-19 more hybrid work. Throughout the crisis, innovative and adaptational thinking has accelerated. This means that organizations have to reconsider the processes, tools, and the people behind the business so they can remain competitive and also focus on high-value impactful work. This is where Value Stream Management comes into the picture. Focus on value stream management is essential when building bridge between agile practices and realizing agility in businesses. Also, value stream relates to the ongoing shift of focusing on value vs. economies of scale or cost, in that way, that you try to update and develop what gives value to the customer and hereby the business instead of trying to produce the highest quantity the cheapest way.

In addition, to better understand once value stream, Value Stream Management makes it possible for organizations to bridge silos and enable collaboration across company borders. This provides foundation for supply chain optimization and with the current digitalization it will impact cross-enterprise interfaces, through that giving more transparency as for information. [4] [5]


Big Idea

Introduction to value stream management

To maintain high levels of customer satisfaction it is important to prevent, address or solve collaboration and communication issues and also eliminating complications across the value chain can be a significant effort, especially at the supply chain interfaces where flow of information or physical goods are exchanged. So where does Value Stream Management come into the picture and why? The following quote states todays view on the value Stream Management approach: “Value stream management is that next step of engagement that looks at how to more effectively drive ongoing continuous improvement and drive more customer value”. [6] Value Stream Management is a management approach which focuses on delivering value from customer request to customer delivery. The approach consists of measuring and improving flow as well as eliminating waste in each step along the way. Because Value Stream Management relates to driving more customer value, the approach has to be put in the context of Lean (insert link about Lean), because Value Stream Management facilitates the transformation of an organization into a lean enterprise by providing a framework to ensure the effective functioning of Lean implementation teams. This does not mean that Value Stream Management is a way of telling people to do their job more effectively, but an approach that allows people to plan and implement improvements that makes it easier to meet customer demands.

Value Stream Management serves not only as a management tool, but also as a planning process to make improvements that enable a company to adopt a Lean approach.

Value Stream Management consist of Eight steps: 1. Commit to Lean 2. Choose the Value Stream 3. Learn about Lean 4. Map the Current State 5. Determine Lean Metrics 6. Map the Future State 7. Create Kaizen Plans 8. Implement Kaizen Plans [7]

The application will dive into the eight steps of Value Stream Management.


Definition of Value Stream

The term value stream originally come from Lean manufacturing and explain the flow of material and information to create value. Value is seen from the customers point of view and is measured in performance. A value stream is the set of activities or services an organization takes to add value to a customer or customer need. These value-added activities can be achieved by eliminating non-value-adding activities and then replacing them with value-adding activities. [8]

• Digital approach and impact on value stream mapping


Value Stream Mapping

- Value Stream Mapping (as a management tool) value stream definition pdf - Example of a Value Stream Map - Material – and information flow mapping - Visualize the value streams across company borders.

StoryBoard

Application/ Discussion

The eight steps of Value Stream Management:

Commit to Lean

Choose the Value Stream

Learn about Lean

Map the Current State

Determine Lean Metrics

Map the Future State

Create Kaizen Plans

Implement Kaizen Plans

The application of Value Stream Management and how to leverage from it

Storyboard partly consist of Value Stream Map, application of Value Stream Map

How to measure value

Organizations in need of Value Stream Management

Limitations

Challenges (Requirements, Work environment)

Benefits and drawbacks (How does it benefit an organization’s agile journey/ business agility

Reference

  1. https://www.lucidchart.com/blog/guide-to-value-stream-management
  2. Standardized Value Stream Management Method to Visualize, Analyze and Optimize Cross-Enterprise Value Stream Data
  3. Value Stream Management Eight Steps to Planning, Mapping, and Sustaining Lean Improvements - By Don Tapping, Tom Luyster, Tom Shuker
  4. https://www.lucidchart.com/blog/guide-to-value-stream-management
  5. Standardized Value Stream Management Method to Visualize, Analyze and Optimize Cross-Enterprise Value Stream Data
  6. https://www.lucidchart.com/blog/guide-to-value-stream-management
  7. Value Stream Management Eight Steps to Planning, Mapping, and Sustaining Lean Improvements - By Don Tapping, Tom Luyster, Tom Shuker
  8. Lean Management by Frank Bertagnolli


Feedback comments: - Change title maybe --> Increasing project performance with Value stream management

- For now, the only tool presented seems to be Value stream mapping. There must be more to it.

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