Valuestreammappingfornon Manufacturing Martin Replacement 100706084816 Phpapp01

Learning Objectives
Participants will learn:
Whatt a Value
Wh
V l Stream
St
Map
M is
i and
d what
h t it iis not.
t
Key differences between manufacturing and
office/service VSMs.
Best practices for holding a Value Stream Mapping
activity.
How to define office & service product families.
Step-by-step approach for creating current and future
state maps
maps.
How to create an implementation plan from the future
state VSM.
2010 Karen Martin & Associates
Value Stream
Mappings Beginnings
Learning to See,
Mike Rother & John Shook
Administrative & Office

Environments
The Complete Lean Enterprise,

Beau Keyte & Drew Locher
Womacks Five Principles of a

Lean Enterprise
Value
Value stream
Flow
Pull
Perfection
Jim Womack
Womack, Lean Thinking,
Thinking 1996,
1996 2003
Value Stream Defined

Value Stream: All of the activities, required to
fulfill a customer request from order to delivery
(and beyond to cash received).
Value Stream
Process
Process
Process
Custom er
Customer
Request
Customer
Receipt
The Work We Do:

Degrees of Granularity
Rooftop
p
View
(Strategic)
Process
In the
Weeds
((Tactical))
Step
Step
Value
Stream
Value Stream
Map
Process
Process
Step
Metrics-Based
Process Map
Stra
ategic
Improvement Roles
Who?
Accountability
Tool
Leadership
What
What has to happen
happen
Value Stream
Mapping
How
How it will happen
Kaizen Events
Events,
Just-do-its,
and Projects
Tactic
cal
Middle
Management
Workforce
Why Value Stream Mapping?

To set strategy before diving into
t ti
tactics.
The future state VSM is a macro

level blueprint for change; road map
Enables us to SEE the process.

Promotes ssystems
stems thinking /
seeing the whole
Helps us avoid sub

sub-optimizing
optimizing
VSM Goal: System Efficiency
System Efficiency =
Optimal Value Stream
Performance
Individual Efficiency =
Sub-optimization
Types of Value Streams

Product Value Streams
Support Value Streams
Value Stream Segments
10

Product Value Streams
Goods wide range

g of manufactured p
products
Services
Healthcare Emergency department patient flow, surgical patient flow,
outpatient testing
Financial Services credit application process, mortgage process,
equipment leasing process
Education college application to arrival
Repair and maintenance wind blade repair
repair, oil field maintenance
maintenance,
refrigeration system service and repair
Energy Nuclear energy production, Oil production
Government Property tax assessment and processing
Law enforcement undercover operations, background check process
Military radar system development, troop deployment
Non-Profit services Donation processing, disaster aid process
Etc.
11

(continued)
Value Stream Segments
Order fulfillment
Product development
New account set-up
Laboratory services
Imaging services
Support Value Streams
Recruiting, hiring and onboarding process

Revenue cycle
Information Technology request fulfillment
Purchasing
Accounts payable
Physician credentialing
12
Why Value Stream Mapping?

(continued)
Shows the linkage between

i f
information
ti and
d material
t i l flflow.
Makes the disconnects and
obstacles
b t l tto flflow visible
i ibl att a
macro level
M t i b
Metrics-based
dd
decision
i i making:
ki
What are you going to do to
affect the numbers?
13
Key Metrics: Time

Process time (PT)
The time
Th
ti
it takes
t k to
t actually
t ll perform
f
the
th work,
k if one is
i
able to work on it uninterrupted
Includes task-specific
task specific doing, talking, and thinking
aka touch time, work time, cycle time
Lead time (LT)

( )
The elapsed time from the time work is made available

until its completed and passed on to the next person or
d
department
t
t in
i the
th chain
h i
aka throughput time, turnaround time, elapsed time
Includes Process Time
Time, not merely waiting time
time.
14
Lead Time vs. Process Time

Scenario 1
Lead Time
Process Time
Work
Received
Work passed
to next step
LT = PT + Waiting
g / Delays
y
15
Lead Time vs. Process Time

Scenario 2
Lead Time
Process Time
Work passed
to next step
Work
Received
LT = PT + Waiting
g / Delays
y
16
Summary Metrics: Time

Activity Ratio (expressed as a percentage)
The percentage of time anything is being done

to the work passing through the system
(whether value-adding
value adding or non
non-value-adding)
value adding)
%Act = (PT LT) 100
100 %Activity = % Time Work is Idle
Common finding = 1-10%
Could also calculate %VA Activity to show how
little time is spent on value-adding activities.
17
Key Metrics: Quality

%Complete and Accurate (%C&A)
The percentage of input thats deemed usable as is

by the person doing the work
% of incoming work where the downstream customer
can perform task without having to CAC:
Correct information or material that was supplied
Add information that should have been supplied
Clarify information that should have or could have been
clearer
Measured by the immediate downstream customer

and all subsequent downstream customers.
Similar to first pass yield in manufacturing
manufacturing.
18
Summary Metrics: Quality

Rolled First Pass Yield (RFPY)
The percent of value stream output that passes

through the process clean, with no hiccups,
no rework required.
required
RFPY = %C&A x %C&A x %C&A
C
Common
fi
finding
di = 0
0-15%
15%
Multiply ALL %C&As, even if parallel processes
19
Current State Value Stream Map

Purchasing Non-repetitive purchases less than $5,000
Inititate Req.
Originator
31
PT = 10 mins.
C&A = 10%
Supplies
Hard Copy
Form File
File Maker
Quicken
Vendor
Website
Excel
ERP
Data Entry
Review
Budget
Review Req.
Finance
PT = 5 mins.
i
C&A = 60%
0.25 days
4 hrs.
PT = 5 mins.
i
C&A = 95%
0.5 days
5 mins.
20 Reqs
Review
Requisition
Review 5
Requisition
40 hrs.
PT = 5 mins.
C&A = 90%
8 hrs.
PT = 5 mins.
i
C&A = 100%
1 days
5 mins.
8 hrs.
10 Reqs
PT = 10 mins.
i
C&A = 95%
4 hrs.
PT = 15 mins.
i
C&A = 98%
0.5 days
10 mins.
Approve in
ERP
24 hrs.
PT = 5 mins.
i
C&A = 90%
3 days
15 mins.
Submit PO
to Supplier
63 Reqs
Corp Purchasing
Manager
1
Admin Asst
Financial Mgr
1
1 days
5 mins.
Enter
Requisition
Review 6
Requisition
IS Manager
1
5 days
5 mins.
Sys Engineer
Supervisor
2
6
2 hrs.
10
External
Supplier
Corp Purchasing
6
56 hrs.
PT = 15 mins.
C&A = 98%
7 days
5 mins.
80 hrs.
PT = 20 mins.
i
10 days
15 mins.
LT = 28.4 days
PT = 65 mins.
AR = 0.477%
RFPY = 4.2%
Customer Demand:
615 requisitions per y ear
PT = Process Time
LT = Lead Time
C&A = % Complete & Accurate
AR = Activ ity Ratio (PT/LT x 100)
RFPY = Rolled First Pass Y ield
Future State Value Stream Map

Additional
IT access
Enter Req.
in ERP
Integrate Form
File with File
Maker
Originator
31
PT=30 mins.
C&A = 85%
Supplies
Requisition
Checklist
Vendor
Websites
File Maker
Cross
Training
Approval
Additional
IT access
4 hrs.
6 hrs.
0.75 days
5 mins.
Place
Order
External
Supplier
PT=20 mins.
80 hrs.
PT=20 mins.
C&A = 98%
1 days
5 mins.
Dedicated
Buyers
Corp Purchasing
8 hrs.
PT=5 mins.
C&A = 90%
PT=5 mins.
C&A = 95%
0.5 days
Approve
in ERP
Dept
Dept.
Manager
1
Supervisor
2
Use budget in place

of Quicken
Auto Notify
Standard
Work for
review
Review
Req.
ERP
10 days
20 mins.
LT = 12.3 days
PT = 30 mins.
AR = 0.508%
0 508%
Customer Demand:
615 requistions per year
PT = Process Time
LT = Lead Time
AR = Activity Ratio (PT/LT x 100)
RFPY = Rolled First Pass Yield
RFPY = 71%
Purchasing Process
Projected Results
M ti
Metric
Lead Time
Process Time
% Activity
Rolled First
Pass Yield
# Handoffs
# IT Systems
Freed capacity
Current
St t
State
Projected
F t
Future
State
St t
%
I
Improvement
t
28.4 days
65 mins
0.48%
12.3 days
30 mins
0.51%
56.7%
53 8%
53.8%
6.3%
4.2%
71.0%
1,590%
10
6
5
3
50%
50%
2.1 FTEs
10%
Summary Metrics: Measuring

Productivity Gains
Labor Effort
# FTEs
Total PT (in hrs) X # occurrences/year

Available work hrs/year/employee
Freed
= Current State FTEs Future State FTEs
Capacity
Note: Improvement can be expressed as Freed
Capacity (FTEs), Time, or Labor Expense (or all)
# FTEs = Full Time Equivalents; 2 half-time people = 1 FTE
23
What do you do with freed capacity?

Absorb additional work without increasing staff
Reduce payroll through natural attrition
Innovate create new revenue streams
Conduct ongoing continuous improvement activities
Do
D ab
better
tt job
j b with
ith ffewer errors and
d hi
higher
h safety
f t
Talk and work with your customers and suppliers
Mentor staff to create career growth opportunities
Provide additional workforce development; cross-train
Better work/life balance
Slow down & think
Get/stay caught up
Do the things you havent been able to get to
Collaborate with other areas
24
Basic Mapping Icons

External
Organization
Push Arrow
Operator / Employee
I
Work-in-Process
Material receipts
& shipments
Go See Scheduling
Process Block
PT= 25 m
C/O 40 m
C/O=
2 Shifts
Takt= 60m
Manual
Information Flow
In-box
Data Block
Hours
Lead Time
Process Time
Minutes
Movement
by
y Truck
Electronic
Information
Flow
Hours
Minutes
Timeline
Hours
Minutes
Minutes

Outpatient Imaging Services
Pre-register
Patient
Customer Demand:
15patients perDay
(Takt Time1920seconds)
8 hours per day
Schedule
Appointment
Referring
Physician
Hospital
Lead Time = 24 days
Lead Time = 990 mins.
Cycle Time = 30 mins.

%C&A
%
C&A = 100 %
Demand = 15 per day

%C&A
%
C&A = 98 %
% C&A = 65 %
CT=Cycle Time
LT=Lead Time
%C&A=% Complete & Accurate
Symposium
E Pay
Excel
ADS
Internet
Meditech
Fax Order
Solutions
Waiting Room
M
Management
t
System
PACS
Auto Fax 50%

Us Mail 25%
MD Mailbox 25%
Rework Loop
via Fax 25% of
the time
Check-in
Patient
(Admitting)
Prep
Patient
(Tech)
Check-in
Patient
(Imaging)
Complete
Exam
(Tech)
Transmit
Images
(Tech)
Read/Dictate
Exam
(Radiologist)
Transcribe
Report
(MDI)
Review
Draft/Sign
(Radiologist)
Print
Reports
(Imaging)
Send
Reports
(Imaging)
5 mins.
5
5 mins
mins.

% C&A = 90 %
0.0833 hrs.

% C&A = 98 %
0.0833 hrs.
2 mins.
45 mins.
0.75 hrs.
1 mins.
30 mins.

% C&A = 100 %
0.5 hrs.
10 mins.
5 mins.

% C&A = 90 %
0.0833 hrs.
15 mins.
248 mins.

% C&A = 100 %
10
4.13 hrs.
3 mins.
365 mins.

% C&A = 95 %
11
6.08 hrs.
15 mins.
960 mins.

% C&A = 75 %
12
16 hrs.
5 mins.
110 mins.

% C&A = 95 %
1.83 hrs.
1 mins.
13
120 mins.

% C&A = 99 %
2 hrs.
1 mins.
14

% C&A = 90 %
LT = 32.5 hrs.
3 mins.
CT = 56 mins.
CT/LT Ratio = 2.87%
Rolled First Pass
yield = 29%
VSM Champion: Paul Scanner

Created: July 17, 2007
Future State Value Stream Map

Outpatient Imaging Services
Standard
Work
Work
Balance
Customer Demand:
15 patients perDay
(Takt Time1920 seconds)
8 hours per day
Co-locate
Schedule appt
Pre-register
Referring
Physician
Hospital
Demand = 15 per day
Lead Time = 15 days

Lead Time = 45 mins
mins.
% C&A = 98 %
% C&A = 85 %
Risk
Reduction
(Joint
Commision)
Symposium
E Pay
Excel
Internet
Waiting
a g Room
oo
Management
System
Standard
Work
35 mins.

% C&A = 98 %
0.0833 hrs.
Complete
Exam
(Tech)
20 mins.

% C&A = 100 %
0.583 hrs.
1 mins.
5 mins.
Auto Fax 80%

Us Mail 15%
MD Mailbox 5%
PACS
5S
120 mins.
Batch
Reductions
R
d ti
Review
Draft/Sign
(Radiologist)
420 mins.

% C&A = 95 %
2 hrs.
2 mins.
Continuous
Flow
Print
Reports
(Imaging)
2 mins.

% C&A = 95 %
7 hrs.
15 mins.
Rework Loop
via Fax 10% of
the time
Voice
Recognition
Read/Dictate
Exam
(Radiologist)

% C&A = 100 %
0.0833 hrs.
10 mins.
Visual
Workplace
Transmit
Images
(Tech)

% C&A = 90 %
0.333 hrs.
10 mins.
Work
Balancing
B
l i
Set-up
Reduction
Prep
Patient
(Tech)
Check-in
Patient
(Imaging)
Fax Order
Solutions
Value Stream
Alignment
Pull System
(Supplies
Kanban)
Remove
Check in
and Reduce
System Access
5 mins.
Meditech
CT=Cycle Time
LT=Lead Time
%C&A=% Complete & Accurate
30 mins.

% C&A = 99 %
0.0333 hrs.
1 mins.
10
Send
Reports
(Imaging)
0.5 hrs.
1 mins.
11

% C&A = 90 %
LT = 11.3 hrs.
3 mins.
CT = 43 mins.
CT/LT Ratio = 6.32%
Rolled First Pass
yield = 40%
VSM Champion: Paul Scanner

Created: July 18, 2007
Outpatient Imaging
Projected Results
Metric
Lead Time
Process Time
Percent Activity
Rolled First
Pass Yield
# Macro Steps
Tech turnover
(annual)
Current
State
Projected
%
Future State Improvement
32.5 hrs
56 mins
2.9%
11.3 hrs
43 mins
6.3%
65%
23%
117%
29%
%
40%
%
38%
%
14
11
21%
100%
25%
75%
Note:
N
t F
Freed
d capacity
it (PT reductions)
d ti
) allowed
ll
d th
the organization
i ti tto earn
$500,000 additional annual revenue with no additional headcount
28
Repea
at
Value Stream Mapping Process

Define
D
fi
Product Family
Products (good or services) with

common process steps
Document Current
State
Foundation
F
d ti
(the
(th basis)
b i ) for
f the
th
future state; 70-80% accurate is
acceptable (directionally correct)
Design Future
State
Create flow by eliminating waste

it is now obvious from your
current state map); typically 3-6
months out
Create
Implementation Plan
Implement!
3 Day
Event
Include accountability and

ti f
timeframes
for
f completion
l ti
Th goall off mapping!

The
i !
Scoping: One VSM per Product Family

Group Product Families by similar downstream processes, steps or equipment.
Process Steps & Equipment
Products
Step A
Step B
Step C
Product
ABC
Product
XYZ
Product
AWR
50
73
2
5
15
12
X
X
Product
SUB
Product
IDR
Step F
Product
ACC
Vol.
Step E
Product
IBM
Step D
X
X
X
X
30
Narrowing the Scope:

Selected Specific Conditions
Non Exempt
Non-Exempt
Staff
Replacements
Exempt
Staff
Hiring
Process
New
Positions
Non-Exempt
Staff
Exempt
Staff
31
Narrowing the Scope:

Selected Specific Conditions
Units
Domestic
C
Consumables
bl
Warranty
Service Parts
Order
Fulfillment
Process
NonWarranty
Units
I t
International
ti
l
C
Consumables
bl
Warranty
Service Parts
NonNon
Warranty
32
Repea
at

Define
D
fi
Product Family

Document Current
State
Foundation
F
d ti
(the
(th basis)
b i ) for
f the
th
Design Future
State

months out
Create
Implementation Plan
Implement!
3 Day
Event

ti f
timeframes
for
f completion
l ti

The
i !
Value Stream Mapping Activity

3-day activity; three deliverables
Day
y 1 Document and analyze
y the current state
Go to the Gemba!
Day 2 Design the future state (3-6 months out)

Day 3 Create the implementation plan
Sequestered team composed primarily of those who can

authorize change
Typically manager and above

The team goes to the gemba to obtain the metrics from the
frontlines doing the work.
Leadership learning and development is a powerful side

benefit.
Key
K success factor
f t - interim
i t i b
briefings
i fi
tto communicate
i t and
d
achieve consensus.
34
Interim Briefings
Day 1 Heres what weve learned.
Establishes a mental framework for embracing

improvements; sells the need for improvement.
Day 2 Heres what we plan to do.
Does anyone
y
object?
j
If so, why?
y
Challenge policies and paradigms
Day 3 Heres
Here s how we
were
re going to execute.
execute
Priorities, approach, timeframes, accountability

Obtain full commitment right then and there.
there
35
Value Stream Mapping
Planning Your Activity:

A well-developed
ll d
l
d charter
h t aids
id in
i
communication, consensus
building and planning
36
Value Stream Mapping Charter

Event Scope
Leadership / Coordination
Executive
VP or C-level
Sponsor
Value Stream Engineering design, ED patient flow , Credit processing, etc.

Specific What circumstances you're including and
Conditions excluding?
Event Date(s)
Value Stream If needed - often Director or

Champion Manager level
Customer Demand How many times is this done per wk, mo, or yr.?
Boundaries &
What is the team NOT authorized to change?
Limitations
The person arranging logistics

Coordinator (reserving the room, ordering food,
sending meeting notices, etc.)
FS Implementation
Typically 90-120 days
Timeframe
Event Drivers
Location Need ample wall space

Meals Always a nice touch; keeps
g
Provided? the team from wandering.
Team Lead Not always needed
process block
Last Step Task on last p
3 days typically; sequential is

best
Start/End
6 hrs minimum; 7 or 8 is best
Times
Facilitator Skilled person leading the activity
Trigger What need does the value stream address?

First Step Task on first process block
Interim Aid in consensus building and

Briefing(s) organizational learning.
Briefing List required attendees; others
Attendees are optional
Mapping Team
Wh are you doing

d i thi
this?
?
1 Why
Function
1 Leadership-heavy
Schedule
Name
Contact Information
Goals & Measureable Objectives

j
1 Aim for objectives w/ measurable targets (from X to X).
10
Planned Deliverables
On Call Support
On-Call
1 Current state VSM
Function
2 Future state VSM
1 SMEs that may not be needed full time
3 Implementation Plan
Name
Contact Information
Potential Obstacles
1 To the team's success with the mapping activity.
Approvals
Executive Sponsor
Value Stream Champion
Facilitator
2
3
4
Signature:
Date:
Signature:
Date:
Signature:
Date:
37
Value Stream Mapping Facilitator

Range of Necessary Traits
Skills / Knowledge
Lean
ea philosophy
p osop y
Improvement tools
Project & time management
Mediation; consensus
b ildi
building
People effectiveness from
front line workers to execs
Authority / Respect
Recognized change agent /

influence leader
Trustworthy
y
Comfortable removing
obstacles & reaching out to
senior leadership
Personality / Energy
Naturally
atu a y cu
curious
ous
Challenging, yet supportive
Positive, upbeat, energetic
Pushy without irritating
Thinks fast on ones feet
Objectivity / Fairness
No attachment to the work

b i iimproved
being
d
38
Repea
at

Define
D
fi
Product Family

Document Current
State
Foundation
F
d ti
(the
(th basis)
b i ) for
f the
th
Design Future
State

months out
Create
Implementation Plan
Implement!
3 Day
Event

ti f
timeframes
for
f completion
l ti

The
i !
The timeline is the most important of the

three defining characteristics of a
VSM:
1) information flow
2) product flow
3) timeline
If your map doesnt include a timeline, it
your map
p has swim
is not a VSM. If y
lanes, its not a VSM.
40
Order Initiation
Current State Map
Demand = XXXX
May 8, 2008
Robert Parker
Infformation
n Flow
Typical VSM Components Manufacturing

g
SUPPLIER
Timeline
Prroduct Flo
ow
Production
Control
Process 1
Process 2
Hours
Hours
Minutes
Process 3
Hours
Minutes
CUSTOMER
Hours
Minutes
Process 4
LT
Minutes PT
Prroduct Flo
ow
Time
eline
Infformation
n Flow
Typical VSM Components Office / Service
ABC Value Stream

Current State Map
Demand = XXXX/yr
Date
Key Contact
CUSTOMER
I.T.
Process 1
Process 2
Hours
Minutes
I.T.
I.T.
Process 3
Hours
Minutes
Process 4
Hours
Minutes
LT
Minutes
PT
Concurrent Work / Parallel Flows

Process
Process
LT = 8 hrs
Process
Process
Process
LT = 4 hrs
Bring longest lead time to the timeline,

unless its a dead end step.
43
Common Differences - Manufacturing vs. Office VSMs

Manufacturing
Office
Upper right
Center
Upper left
None
The
The thing
thing we
were
re
following
Raw material
material, subsub
assemblies, finished goods
Paper, verbal
Paper
verbal, and
electronic Information
Information Flow
More structured /
y
formalized I.T. systems
Multiple I.T. systems and

work-arounds
Multiple points across VSM
Work not scheduled
Y
Yes
S
Sometimes
ti
Inventory triangle
In-bin (if preferred)
Fi t Pass
First
P
Yield
Yi ld (FPY)
Percent Complete &

Accurate (%C&A)
Takt Time
Typically can be applied
Only applicable with

dedicated resources
LT determination for
each block
Based on WIP between

process blocks
Based on a single item

passing through
Customer icon
Supplier icon
Schedule notification
Material flow ((via
hollow arrow)
WIP icon
Q lit Metric
Quality
M ti
Preparing to Map
Schedule time to go to the Gemba
Prepare frontlines for questions the team will ask;

establish a safe haven for them to communicate the
true current state (no matter how ugly it is) to high
level leaders they may not usually interface with.
No written procedures allowed creates bias toward
communicating
i ti what
h t should
h ld happen
h
rather
th th
than what
h t
does happen.
45
Preparing to Map (continued)

Draw map manually!
11 x 17 paper
Or 36 wide plotter paper and 3 x 6 post-its for
process blocks (my preference)
Only convert to electronic medium if absolutely

necessary (e-distribution,
(e distribution, training, etc.)
iGrafx FlowCharter (my preference)

Systems2Win
y
Excel-based
Minitab
e-VSM
Others
46
Step 1
Label your map (draw manually or use 36
wide plotter paper and 3 x 6 post-its)
Value stream name

Current or future state
Customer demand ((volume of work p
per time
period)
Takt time (if relevant)
Date
Facilitators name ((and/or team))
47
Takt Time:
The Key to Continuous Flow
T kt time
Takt
ti
=
Takt time =
Available work time

Customer demand
480 minutes/day
45 new accounts
T
Touch
h down
d
= 10.6 mins
OR
Time Available divided by what Kustomer Takes
48
Step 2
Identify all blocks in the process (target 5-15 blocks)
Customer icon is placed in upper right or middle

Upper right if supplier exists (supplier is placed in upper left)
Middle position if a separate supplier doesnt exist
Supplier (if relevant) is placed in upper left

Each block (post-it) contains an activity or group of activities that
occurs before a break in the timeline occurs - typically a handoff to
another function/work team
team.
Activity format is verb/noun what happens to what
Include the function who performs the task
Include number of workers who perform the task
Include any obstacles to flow batches, shared/inaccessible
resources, system downtime, etc.
Consider walking the process
49
Post-it Conventions
Process
(
(Verb/Noun)
)
Function
# Staff
(if relevant)
Barriers to flow
Step 3
Identify all I.T. systems used in the
process and information flow
For most VSMs, these are placed above the

process blocks
In very complicated VSMs with two rows of
process blocks, I.T. systems can be placed
between the rows, if necessary.
N t any scheduling
Note
h d li th
thatt occurs ((rare iin
current state)
Wh ttells
Who
ll whom
h
tto d
do what?
h t?
51

Inititate Req.
Originator
31
PT = 10 mins.
C&A = 10%
Supplies
Hard Copy
Form File
File Maker
Quicken
Vendor
Website
Excel
ERP
Data Entry
Review
Budget
Review Req.
Finance
PT = 5 mins.
i
C&A = 60%
0.25 days
4 hrs.
PT = 5 mins.
i
C&A = 95%
0.5 days
5 mins.
20 Reqs
Review
Requisition
Review 5
Requisition
40 hrs.
PT = 5 mins.
C&A = 90%
8 hrs.
PT = 5 mins.
i
C&A = 100%
1 days
5 mins.
8 hrs.
10 Reqs
PT = 10 mins.
i
C&A = 95%
4 hrs.
PT = 15 mins.
i
C&A = 98%
0.5 days
10 mins.
Approve in
ERP
24 hrs.
PT = 5 mins.
i
C&A = 90%
3 days
15 mins.
Submit PO
to Supplier
63 Reqs
Corp Purchasing
Manager
1
Admin Asst
Financial Mgr
1
1 days
5 mins.
Enter
Requisition
Review 6
Requisition
IS Manager
1
5 days
5 mins.
Sys Engineer
Supervisor
2
6
2 hrs.
10
External
Supplier
Corp Purchasing
6
56 hrs.
PT = 15 mins.
C&A = 98%
7 days
5 mins.
80 hrs.
PT = 20 mins.
i
10 days
15 mins.
LT = 28.4 days
PT = 65 mins.
AR = 0.477%
RFPY = 4.2%
Customer Demand:
PT = Process Time
LT = Lead Time
Step 4
Number the process blocks from left to
right.
If parallel processes exist, use alpha modifiers

e.g. 8A, 8B, etc.
Connect the customer, supplier (if present)

and process blocks
Striped
p
arrow for p
push systems
y
Hollow arrow for material flow
Connect and I.T.

I T systems
53
Post-it Conventions
Process Block #
Process
((Verb/Noun))
Function
# Staff
(if relevant)
Barriers to flow
PT (p
(process time))
% Complete &
Accurate
LT (Lead time)
Depicting e-Information Flow

I.T.
Application
Process
Block
I.T.
Application
Arrow pointing to
I T application:
I.T.
li ti
Staff enters data
I.T.
Application
Process
Block
Arrow pointing from

I.T. application:
Staff views data
Process
Block
#1 I.T.
Application
Two-headed arrow:
St ff both
Staff
b th views
i
and
d
enters data
#2 I.T.
Application
Lightning bolt arrow:

Application #1 auto-populates
application #2
55

Inititate Req.
Originator
31
PT = 10 mins.
C&A = 10%
Supplies
Hard Copy
Material
flow
Form File
File Maker
Quicken
Vendor
Website
Excel
ERP
ERP autopopulates
P.O.
Data Entry
Review
Budget
Review Req.
Finance
PT = 5 mins.
i
C&A = 60%
0.25 days
4 hrs.
PT = 5 mins.
i
C&A = 95%
0.5 days
5 mins.
20 Reqs
Review
Requisition
Review 5
Requisition
40 hrs.
PT = 5 mins.
C&A = 90%
8 hrs.
PT = 5 mins.
i
C&A = 100%
1 days
5 mins.
8 hrs.
10 Reqs
PT = 10 mins.
i
C&A = 95%
4 hrs.
PT = 15 mins.
i
C&A = 98%
0.5 days
10 mins.
Approve in
ERP
24 hrs.
PT = 5 mins.
i
C&A = 90%
3 days
15 mins.
Submit PO
to Supplier
63 Reqs
Corp Purchasing
Manager
1
Admin Asst
Financial Mgr
1
1 days
5 mins.
Enter
Requisition
Review 6
Requisition
IS Manager
1
5 days
5 mins.
Sys Engineer
Supervisor
2
6
2 hrs.
10
External
Supplier
Corp Purchasing
6
56 hrs.
PT = 15 mins.
C&A = 98%
7 days
5 mins.
80 hrs.
PT = 20 mins.
i
10 days
15 mins.
LT = 28.4 days
PT = 65 mins.
AR = 0.477%
Push
A
Arrow
RFPY = 4.2%
Customer Demand:
PT = Process Time
LT = Lead Time
Step 5
Add key metrics for all process blocks
Process Time (PT)

Lead Time (LT)
P
Percent
t Complete
C
l t & Accurate
A
t (%C&A)
Add additional obstacles to flow if any are

id tifi d ((e.g. b
identified
batches,
t h
shared
h d resources
system availability/speed, etc.)
Add th
the WIP (work-in-process)
(
ki
) for
f allll
process blocks.
57
Post-it Conventions
Process Block #
Process
((Verb/Noun))
Function
# Staff
(if relevant)
Barriers to flow
PT (p
(process time))
% Complete &
Accurate
LT (Lead time)
Three Places WIP Accumulates

Before the process block work not yet begun.
Within the process block work currently being
performed.
After the process block Work thats complete
complete,
but hasnt been passed on
WIP WIP
WIP
Step 1
Step 2
Step 3
59

Inititate Req.
Originator
31
PT = 10 mins.
C&A = 10%
Supplies
Hard Copy
Form File
File Maker
Quicken
Vendor
Website
Excel
ERP
Data Entry
Review
Budget
Review Req.
Finance
PT = 5 mins.
i
C&A = 60%
0.25 days
4 hrs.
PT = 5 mins.
i
C&A = 95%
0.5 days
5 mins.
20 Reqs
Review
Requisition
Review 5
Requisition
40 hrs.
PT = 5 mins.
C&A = 90%
8 hrs.
PT = 5 mins.
i
C&A = 100%
1 days
5 mins.
8 hrs.
10 Reqs
PT = 10 mins.
i
C&A = 95%
4 hrs.
PT = 15 mins.
i
C&A = 98%
0.5 days
10 mins.
Approve in
ERP
24 hrs.
PT = 5 mins.
i
C&A = 90%
3 days
15 mins.
Submit PO
to Supplier
63 Reqs
Corp Purchasing
Manager
1
Admin Asst
Financial Mgr
1
1 days
5 mins.
Enter
Requisition
Review 6
Requisition
IS Manager
1
5 days
5 mins.
Sys Engineer
Supervisor
2
6
2 hrs.
10
External
Supplier
Corp Purchasing
6
56 hrs.
PT = 15 mins.
C&A = 98%
7 days
5 mins.
80 hrs.
PT = 20 mins.
i
10 days
15 mins.
LT = 28.4 days
PT = 65 mins.
AR = 0.477%
RFPY = 4.2%
Customer Demand:
WIP
PT = Process Time
LT = Lead Time
Step 6
Create timeline & calculate summary

metrics
Timeline PT Sum
Timeline LT Sum
Activity
A ti it Ratio
R ti
Rolled First Pass Yield (RFPY)
61
How to Treat Lead Time in

Office/Service Environments
Lead Time
Process Time
Process 1
LT
Process 2
LT
PT
PT
Office/Service Lead Time

From the time work is made available until its been completed AND passed on
to the next person/work group/department in the process.
Placed on the peak of the timeline to the left of the process block it refers to.
Represents total throughput time, including process time; not merely wait time.
62

j
Results
Projected
Metric
Current State
Projected
Future State
Projected %
Improvement
Timeline
Ti
li Lead
L d
Time
Timeline
Process Time
Activity Ratio
Rolled
R
ll d First
Fi t
Pass Yield
Total Process
Time (all
( blocks))
Labor Effort
Others, as
relevant
63
Typical Current State Findings

Unnecessary
NVA
Available
to work on
Value Add
Necessary
NVA
Available to
next step
Islands of activity (process times) within long lead times.
64
Step 7
Identify all value-adding (VA) and necessary
non-value-adding
l
ddi (N) steps
t
Add VA or N smaller post-it to relevant process

blocks
All unnecessary non-value-adding blocks remain
unlabelled
Enter
Order
Check
Credit
Approve
Order
Customer Rep
Finance
Sales Rep
VA
Value-adding
Necessary
Non-Value-Adding
Unnecessary
Non-Value-Adding
65
Customer-Defined Value
Value-Adding (VA) - any operation or
activity
ti it your external
t
l customers
t
value
l
and are (or would be) willing to pay for.
N
Non-Value-Adding
V l Addi (NVA) - any operation
ti
or activity that consumes time and/or
resources but does not add value to the
product (good or service) the customer
receives.
receives
Necessary support processes, regulatory

requirements, etc.
Unnecessary everything else - WASTE
66
Work Effort as Defined by the

External Customer
Unnecessary N
U
Nonvalue adding
Necessary non-valueadding
Value-adding
Repea
at

Define
D
fi
Product Family

Document Current
State
Foundation
F
d ti
(the
(th basis)
b i ) for
f the
th
Design Future
State

months out
Create
Implementation Plan
Implement!
3 Day
Event

ti f
timeframes
for
f completion
l ti

The
i !
Designing the Future State Value

Stream
Target All Waste!
69
Eight Wastes (Muda)
Overproduction
Inventory
y
Waiting
Over Processing
Over-Processing
Errors
Motion (people)
Transportation
p
(material/data)
Underutilized
people
70
Future State Design

Goal: Removing
g all obstacles to flow ((the
thing should never stop)
Batches
Rework
WIP / Bottlenecks
Handoffs
Setup / changeover
Physical layout
Motion & transportation
71
Eight Questions for

Future State VSM
1. What are the customer requirements? Whats the takt
time?
2. With goods, will we produce to order or to finished
goods inventory?
g
y ((With services, yyoure almost always
y
producing to order.)
3. Where can continuous flow be put in place?
4 Where
4.
Wh
should
h ld pullll systems
t
b
be iimplemented?
l
t d?
5. What is the single point of scheduling?
6 How do we level the load and the mix?
6.
7. What should the management time frame be?
8. What process improvements are necessary to achieve
the future state?
-- Rother & Shook, Learning to See
Future State Design

Considerations
Error-proof (including
incoming customer
requests)
Standardize the work
Eliminate steps / handoffs
Eliminate waste
Combine steps
Create parallel paths
Alter task sequencing and/or
timing
Eliminate or reduce batches
Level demand
Balance work to meet

takt time requirements
Co-locate and crosstrain work teams
Implement pull
Implement visual
management
Organize the workplace
so problems are visible
Reduce
R d
changeover
h
Eliminate motion &
p
transportation
73
Building a Lean Enterprise
Process
Stabilization
Tools
Building a Lean Enterprise
Flow Enabling
Tools
Future State Icons

Withdrawal
Combined Steps
Kanban
Arriving
in Batches
Eliminated Step
Max 8 things
FIFO
First-In
First-Out
(max WIP
defined)
Production
Kanban
Withdrawall
Withd
Kanban
Signal
Kanban
Buffer Stock
OXOX
Kaizen Burst
Supermarket
Leveling,
Mi and/or
Mix
d/
Volume
Kanban
Post
Kanban
Path

j
Results
Projected
Metric
Current State
Projected
Future State
Projected %
Improvement
Lead Time
Process Time
% Activity
Rolled First
Pass Yield
Labor Effort
77
Repea
at

Define
D
fi
Product Family

Document Current
State
Foundation
F
d ti
(the
(th basis)
b i ) for
f the
th
Design Future
State

months out
Create
Implementation Plan
Implement!
3 Day
Event

ti f
timeframes
for
f completion
l ti

The
i !
Future State Implementation Plan

Value Stream Outpatient Imaging
Implementation Plan Review Dates

11/1/2007
Executive Sponsor Allen Ward

Value Stream Champion Sally McKinsey
11/21/2007
Value Stream Mapping Facilitator Dave Parks
12/13/2007
Date Created 10/18/2007

Block
#
2
Goal / Objective
Improve quality of referral
Improvement Activity
Implement standard work for referral
process
Type
Owner
KE
Sean O'Ryan
PROJ
Dianne
Prichard
3, 4
Reduce lead time beween schedulingand

Cross-train and colocate work teams
preregistration steps
5, 6
Eliminate the need for two patient checkins
Collect copays in Imaging
KE
Michael
O'Shea
g area
Eliminate bottleneck in waiting
Balance work / level demand
KE
Dianne
Prichard
P
i h d
Eliminate lead time associated with

transcription step
Implement voice recognition technology
PROJ
Sam Parks
10
Eliminate batched reading
Reduce setup required
KE
Sam Parks
Reduce inventory costs, regulatory risk

and storage needs
5S CT supplies area; implement kanban
KE
Michael
O'Shea
12
Reduce delay in report delivery
Implement additional fax ports
PROJ
Martha Allen
12
Reduce delayy in report

p deliveryy
Increase percentage of physicians

receiving
g electronic deliveryy ((rather than
hard copy)
KE
Martha Allen
1/10/2008
Implementation Schedule (weeks)
2 3 4 5 6 7 8 9 10 11 12
Approvals
Executive Sponsor
Value Stream Champion
Value Stream Mapping Facilitator
Signature:
Signature:
Signature:
Date:
Date:
Date:
Date
Complete
PACE Prioritization Matrix

Easy
IT
I.T.
15
23
Policy
10
Process
13
20
18 17
14
25
9
16
26
12
22
27
Difficultt
Ease of Implem
E
mentatiion
21
24
19
11
3
High
Anticipated Benefit
Low
80
About Karen Martin

Early career as a scientist; migrated to quality
& operations design in the mid
mid-80
80s
s.
Launched Karen Martin & Associates in 1993,
focusing on operations design and Total Quality
Management.
Management
Began applying white collar lean in 2001.
Co-author of The Kaizen Event Planner:
A hi i R
Achieving
Rapid
id IImprovementt iin Offi
Office,
Service, and Technical Environments; codeveloper of Metrics-Based Process Mapping:
Karen Martin, Principal
An Excel-Based
Excel Based Solution
Solution.
Karen Martin & Associates
University of California, San Diego Lean
Enterprise program instructor.
For
F more information:
i f
ti
www.ksmartin.com
k
ti
81

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Learning Objectives

Participants will learn:

2010 Karen Martin & Associates

Administrative & Office

The Complete Lean Enterprise,

Womacks Five Principles of a

2010 Karen Martin & Associates

Value Stream Defined

2010 Karen Martin & Associates

The Work We Do:

2010 Karen Martin & Associates

2010 Karen Martin & Associates

Why Value Stream Mapping?

The future state VSM is a macro

Enables us to SEE the process.

Helps us avoid sub

2010 Karen Martin & Associates

VSM Goal: System Efficiency

2010 Karen Martin & Associates

Types of Value Streams

2010 Karen Martin & Associates

Types of Value Streams

Goods wide range

2010 Karen Martin & Associates

Types of Value Streams

Support Value Streams

Recruiting, hiring and onboarding process

2010 Karen Martin & Associates

Why Value Stream Mapping?

Shows the linkage between

2010 Karen Martin & Associates

Key Metrics: Time

Lead time (LT)

The elapsed time from the time work is made available

2010 Karen Martin & Associates

Lead Time vs. Process Time

Lead Time vs. Process Time

Summary Metrics: Time

The percentage of time anything is being done

2010 Karen Martin & Associates

Key Metrics: Quality

The percentage of input thats deemed usable as is

Measured by the immediate downstream customer

2010 Karen Martin & Associates

Summary Metrics: Quality

The percent of value stream output that passes

2010 Karen Martin & Associates

Current State Value Stream Map

Future State Value Stream Map

Use budget in place

2010 Karen Martin & Associates

Summary Metrics: Measuring

Total PT (in hrs) X # occurrences/year

2010 Karen Martin & Associates

What do you do with freed capacity?

Basic Mapping Icons

Current State Value Stream Map

Lead Time = 24 days

Lead Time = 990 mins.

Cycle Time = 30 mins.

Demand = 15 per day

Lead Time = 12 mins.

Cycle Time = 11 mins.

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