Value Stream Mapping

Value Stream Mapping on a Budget (Using a Spreadsheet)

By Gary Burger and F. Lee Campbell IV

Value stream analysis is one of the easiest methods to analyze a process and identify areas that can be improved. Even someone inexperienced can find the low hanging fruit. But what do you do when you want to conduct a value stream analysis and the boss tells you that he is not going to buy you dedicated software and pay to train you because then he would have to do the same for every Belt in the organization and he cannot afford it?

The answer is simple if you have any background in using a spreadsheet. While you cannot perform some of the additional functions that can be achieved by the software packages created just for this purpose, you will be able to develop a value stream map (VSM) that will achieve what you are trying to accomplish.

The process requires three worksheets but all are fairly simple and once the templates are set up, you can record future VSMs with little setup work. The first worksheet indicates the actual steps in the process. Start with the current process and use two boxes per step. The top box indicates who performs the step and uses color coding. The box also is numbered to indicate what step is being performed. The box below indicates what is actually being performed. Below the current state, repeat the identical steps to follow the future state.

This has two advantages over the specialized software. First, it shows the current state and the future state next to each other for quick comparison. Even the unsophisticated used can determine easily how many steps have been eliminated. Second, this system forces a linear view. Often VSMs are created from flow charts which show several steps in parallel and a great number of steps vertically. A good VSM is totally horizontal. This method forces steps to be considered in linear way. While you are free to add another row to show two process streams, you will be discouraged from having multiple process streams unless you truly go through the mental thought process to create them.

First Worksheet – Steps in Process

The next worksheet is where data is entered. You can set up the data in any of several formats. One way is to actually have two worksheets side-by-side, one for current state and one for future state. This method is easier to work with since you enter the data for one and then for the other independently. The other method is to enter the process step on each line and continue the data out with all calculations. There seems to be an advantage in creating two smaller worksheets but formatting is all a matter of preference.

Table 1: Second Worksheet – Enter the Data
Current State
Step	Task	Cycle Time		Touch Time		People
		Min.	Max.	Min.	Max.	Min.	Max.
1	Problem Discovered	16	32	8	8	5	10
2	Field Investigates Problem	24	40	2	12	2	3
3	Modification Required Decision Point	1	16	1	2	2	4
4	Assign Number and Prepare Modification File	1	4	1	1	1	1
5	Define Statement of Work	16	40	4	16	2	3
6	Project Manager Enters into Project Tracking System	1	4	1	1	1	1
7	Modification Review Board	40	80	8	16	6	6
8	Design Support for Change Order	0	160	0	80	5	10
9	Allocate Funding	8	40	2	4	5	7
10	Funding Project	8	40	2	4	5	7
11	Notify Change Customer	8	16	1	1	3	3
12	Prepare Necessary Documents	0	80	0	24	0	5
13	Funds Available	1	8	.25	1	2	3
14	Funds Request	0	16	0	8	4	4
15	Funds Approved	0	0	0	0	0	0
16	Budget Amended and Approved	8	40	1	2	2	2
17	Request for Proposals	8	16	1	4	2	2
18	Receive Contractor Proposals	80	360	1	1	2	2
19	Prepare Pre-Negotiation Objectives	0	40	0	8	1	1
20	Legal Review of Changes Greater Than $100,000	24	40	1	2	2	4
(Variables Limited to Formatting Constraints)
Future State
Step	Task	Cycle Time		Touch Time		People
		Min.	Max.	Min.	Max.	Min.	Max.
1	Problem Discovered	16	32	8	8	5	10
2	Field Investigates Problem	24	40	2	12	2	3
3	Modification Required Decision Point	1	16	1	2	2	4
11	Notify Change Customer	8	16	1	1	3	3
5	Define Statement of Work	16	40	4	16	2	3
4	Assign Number and Prepare Modification File	1	4	1	1	1	1
6	Project Manager Enters into Project Tracking System	1	4	1	1	1	1
8	Design Support for Change Order	0	160	0	80	5	10
12	Prepare Necessary Documents	0	80	0	24	0	5
13	Funds Available	1	8	.25	1	2	3
14	Funds Request	0	16	0	8	4	4
15	Funds Approved (Preliminary)	0	0	0	0	0	0
17	Request for Proposals	8	16	1	4	2	2
18	Receive Contractor Proposals	80	360	1	1	2	2
19	Prepare Pre-Negotiation Objectives	0	40	0	8	1	1
22	Negotiate with Contractor	8	24	4	16	2	2
23	Reach Settlement (Bilateral)	8	40	4	8	2	2

Finally you will need to create a summary worksheet. Again this can be placed this on a separate worksheet or at the top or bottom of the data sheet. Wherever this section is placed, it should be easy to find because this where you perform your analysis. As is obvious, you can have as many variables as you desire. Adding variables is as easy as adding "min." and "max." columns for the current and future states. You can track further by time period or any other factor you think necessary.

Table 2: Third Worksheet – the Summary
	Current State	Future State	Improvement
Steps	25	17	32%
Cycle Time	76/338	60/212	21-37%
Touch Time	18/34	15/24	16-29%
Touch Time/Cycle Time	16.8%	27-47%
Number of People	65/82	40-52	36-38%
Approvals	44-46	29-31	32-34%
Rework	365%	185%	49%

About the Authors: Gary Burger is the internal review officer for the Los Angeles District of the U.S. Army Corps of Engineers. He is an ASQ/Department of the Navy certified Lean Six Sigma Black Belt. He also instructs for the NAVSEA Lean Six Sigma College in Port Hueneme, California, U.S.A. He can be reached at gary.b.burger@usace.army.mil. F. Lee Campbell IV has been the Lean Six Sigma implementation program manager for the U.S. Army Corps of Engineers since inception. The program now comprises 27 Belts in various stages of development and 74 projects. He is a graduate of the U.S. Military Academy and has an MBA from Georgetown University. He came be reached at lee.f.campbell@hq02.usace.army.mil.

Kaizen and Problem Solving

Fast and Intense: Kaizen Approach to Problem-Solving

By Mark Price and Tim Williams

Perhaps it was impatience with how long traditional projects take. Often it was an awareness of how hard it is for people to concentrate on improvement when they keep thinking about getting their work done. To some extent it was a matter of their innate respect for the people who do the work. For all these reasons, years ago the Japanese inventors of the Lean improvement systems came up with a different improvement model they called Kaizen.

Kaizens (or blitzes, as they are sometimes called) are improvement events where people work only on improvement for a few days, up to a full week. In a traditional Kaizen project, the people from a particular work area come together with a few experts for four or five days straight and complete most or all of a DMAIC cycle on a narrowly targeted high-priority issue. ("We need to process loan applications faster.") The model has been so successful that this basic approach has been adapted to other uses such as service design sessions.

Example of a Bank's Use of Kaizen

A major national bank started using the five-day Kaizen approach whenever it wanted to attack process speed and efficiency problems. The bank's Kaizen events all share four characteristics:

• The purpose is to take a cross-functional view of the process or work area.
• Participants are people who are directly involved in, and usually responsible for, various parts of the process. The team is cross-functional.
• Participants are pulled off their jobs for several days at a time.
• The project is well-defined going in because there is not time to redefine the purpose or scope.

A Typical Kaizen Schedule

Here is a sample agenda which the bank uses for the five days:

Day 1 is an afternoon spent training participants on topics that cover basic concepts related to the goals of the project. This could include teaching relevant Lean or Six Sigma concepts and reviewing relevant data.

Day 2 is spent looking at the process with new eyes. Participants do a "unit walk," a tour of operations affected by the problem or situation being studied where they simulate being a work item flowing through the process. The group visits each portion of the process, where, because there is cross-functional representation, they have the opportunity to hear insights from someone who works in that area. The group creates a value stream map (a picture of the "as-is" situation) that captures the basic process steps, such as cycle times, number of steps, rework loops, queuing delays, work in progress (WIP) and transportation time.

Day 3 is designed around clarifying problems and brainstorming solutions. The team re-organizes the value stream (on paper) or creates a "should" map that depicts how the process would need to function to solve the identified problems. The outcome includes developing action plans for implementing solutions or trial simulations for the next day.

Day 4 is used to test the solutions, conducting a simulation within the operations if possible. The group quantifies the improvement if the proposed changes are implemented, using estimates of reductions in travel time, queuing time, work in process, number of steps, number of forms, and so on.

Day 5 is when participants prepare and present their findings to the sponsor in a formal report-out session.

Making It Work and the Results

The bank makes this model work by having its internal consultants (equivalent to Master Black Belts) partner with the manager/sponsor to pick problems that are extremely high priority, not only for that work area but also for the business as whole. This makes it much easier to justify taking people off their regular jobs. Also, the goal of the event is a little more modest than a traditional Kaizen. Instead of having solutions up and running full-bore after five days, teams are expected only to get through the simulation and piloting of solution ideas. The internal consultant will then assist the team with full-scale implementation.

In the many Kaizens this bank has run, it has achieved results such as:

• Cycle-time improvements have ranged from 30 percent faster to nearly 95 percent faster, measured sometimes in minutes and other times in days. One administrative process went from 20 minutes to 12 minutes, and a complaint resolution process dropped from 30 days to 8 days.
• Fiscal indicators have all been positive. One high-level project has allowed the bank to start charging for a service that previously was offered free to customers. New revenues are expected to total between $6 million to $9 million per year. Other projects have led to cost reductions or loss avoidance in the hundreds of thousands of dollars.

An Alternative Kaizen Format

While consecutive days of intense work is the ideal, some companies have found it impossible to pull an entire work group, or even a subset of a work group, off the job for the better part of a week.

One company worked around this issue by using the following structure:

• The team was brought together for a brief meeting where the problem was explained and people brainstormed what they would need to know and understand in order to find solutions.
• The team leader, a Black Belt, and one team member then worked offline during a period of several weeks to gather data and refine the problem definition.
• The team was brought together for a day to rapidly analyze the problem and come up with complete action plans – not just ideas – for improvement.
• Since the changes likely would affect the everyday work of the team members, they and others were involved in making the changes real-time on the job, and establishing a control plan.

This alternative Kaizen structure works well in this company because:

• The company is still relying on the knowledge of the people who actually do the work.
• It is data-based decision making.
• The company starts with a narrowly defined problem or opportunity statement – often the participants may be examining how they can implement a Lean principle to their process, such as "How can we make information flow better?"
• The company takes steps to verify that the target is likely to bring important, measurable results. Random or "drive by" Kaizens, chosen with little forethought, may, at best, lead to local improvements, but will not contribute to significant value stream gains.

Conclusion: Concentrating on Creativity

Kaizen events are a powerful improvement tool because people are isolated from their day-to-day responsibilities and allowed to concentrate all their creativity and time on problem-solving and improvement. Companies which use Kaizens have found they generate energy among those who work in the area being improved, and produce immediate gains in productivity and quality.

About the Authors: Mark Price is a vice president with George Group and has led Lean Six Sigma deployments for Global 500 clients in service and product companies. He has been working with corporate teams to design and implement successful performance improvement programs for the last 16 years. He can be reached at mprice@georgegroup.com. Tim Williams is a Master Black Belt at George Group. He is experienced in applying Lean Six Sigma to the financial services industry to drive bottom-line results. He has assisted organizations in scorecard development, business review practices, and process improvement strategies. Mr. Williams has been a speaker at conferences for the Banking Administrative Institute and the Institute of Business Forecasting. He also contributed to the book Lean Six Sigma for Service by Michael George. He can be reached at twilliams@georgegroup.com.

Value Stream Mapping

New from iSixSigma Dominating Markets with Value E-book Lean Value Stream Mapping Quick Reference Guide Lean Principles Quick Reference Guide

Value stream mapping is a paper and pencil tool that helps you to see and understand the flow of material and information as a product or service makes its way through the value stream. Value stream mapping is typically used in Lean, it differs from the process mapping of Six Sigma in four ways:

1) It gathers and displays a far broader range of information than a typical process map.
2) It tends to be at a higher level (5-10 boxes) than many process maps.
3) It tends to be used at a broader level, i.e. from receiving of raw material to delivery of finished goods.
4) It tends to be used to identify where to focus future projects, subprojects, and/or kaizen events.

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A value stream map (AKA end-to-end system map) takes into account not only the activity of the product, but the management and information systems that support the basic process. This is especially helpful when working to reduce cycle time, because you gain insight into the decision making flow in addition to the process flow. It is actually a Lean tool.

The basic idea is to first map your process, then above it map the information flow that enables the process to occur.

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Posted By: Ron
Modified By:
Last Modified: Jul. 31, 2003

Kaizen Event

New from iSixSigma Kaizen Workshop E-book Defect Prevention Reference Guide Preventative Maintenance Log Worksheet

Any action whose output is intended to be an improvement to an existing process.

Kaizen Events are commonly refered to as a tool that:

1) Gathers operators, managers, and owners of a process in one place
2) Maps the existing process (using a deployment flowchart, in most cases)
3) Improves on the existing process
4) Solicits buy-in from all parties related to the process

Kaizen Events are an extremely efficient way to quickly improve a process with a low Sigma score. Kaizen Events are also useful for convincing organizations new to Six Sigma of the methodology's value.

The true intent of a Kaizen Event is to hold small events attended by the owners and operators of a process to make improvements to that process which are within the scope of the process participants.

Keep it Simple

Keep it Simple: Choose the Best Tools for Kaizen Events

By Robert Tripp

Kaizen events are deceptively simple. The tools used are often considered to be less rigorous than the more analytical tools that are the hallmark of Six Sigma. But in practice, Kaizen events can be challenging to facilitate effectively because participants are pulled from their regular roles, requiring the events to be short and focused, and facilitators to be efficient in their selection and execution of problem solving tools.

Facilitators trained in the Six Sigma methodology may be tempted to use more rigorous analytical tools. A non-statistical tool, the value stream map, is the focus during Kaizens, however, and when selecting other tools to accompany the map, Belts must be mindful not to introduce anything overly complicated.

Focus on the Value Stream Map

Standard tools and approaches in Kaizen can vary, but the backbone of most Kaizen events is the value stream map. Beyond that, the specific tools applied in any given event will depend on a variety of factors. Selecting the right tools for a given situation is challenging and using the tools effectively can be even harder. Furthermore, the tools that are most useful for complementing the value stream map in Kaizen events are other non-statistical tools, such as selection matrices, fishbone diagrams and brainstorming.

Recently I observed a Kaizen team immediately jump into a failure mode and effects analysis (FMEA) following the creation of a well-documented current state value stream map. Any positive momentum that had accumulated during the value stream work was immediately squelched as the team slogged through an excessively detailed and painful FMEA. While the FMEA can be an effective tool for documentation or detailed process analysis, forcing a team to meticulously examine how they do work, it can also be mercilessly laborious, and in the context of a Kaizen event it must be applied selectively. In this case, the team attempted to document a detailed FMEA for the entire value stream and to make matters worse, the FMEA was improperly facilitated, yielding misleading risk priority number (RPN) scores.

The Role of the Facilitator

Examples such as the use of the FMEA are common in Kaizen events because facilitators often fail to prudently select the best tools and techniques for their situation. The irony is that the tools are simple to understand; the way they are manipulated and applied requires a special skill in the context of Kaizen. The good news is that while there is some mystery in the successful application of Kaizen tools, there are several ways to improve the chances of success.

The first step is to plan and prepare for the event, taking into consideration the participants and desired outcome for the effort. While not every Kaizen event will require takt time analysis and redefinition of standard work combinations, every event should produce a list of immediate and future improvement actions with dates and responsibilities assigned. In the course of planning, ensure that the proper scope and objectives are consistent with the complexity of the process being studied and the time allotted for the event. Traditional Kaizen events, which aim for inventory, waste and cycle time reductions in five days or less, are best applied to operational processes where no more than three different functions play important roles in the value stream.

As in any project management endeavor, the advice of the day for Kaizen event planning is “don’t bite off more than you can chew.” Events that focus on larger, multi-disciplinary or cross-functional organizations should be limited in their objectives to thorough value stream documentation, management system implementation and waste elimination at a high level. One major outcome of such events – in addition to fundamental improvements – is often a detailed plan for more focused Kaizen events in the future. This is consistent with the philosophy that processes should be “Kaizened” periodically, not addressed once and then ignored.

Establishing Basic Disciplines

In addition to scope, complexity and time allowed, Kaizen event objectives should also take into account the maturity of the organization or process to be improved. Navigating the path to Lean requires basic disciplines to be established in the following order:

1. Workplace organization (5S)
2. Visual workplace (signals to work and visible performance data)
3. Standardized work (process control)

Establishing these fundamentals can require considerable time, but they are important contributors to the efficacy and the permanence of continuous improvement efforts like Kaizen. In many cases it is appropriate for a single five-day Kaizen event to focus purely on establishing 5S standards and methods.

Ensuring Useful Results

For certain team-based tools, Black Belts and Green Belts should not let their facilitation be encumbered by the exact approach that they learned in their DMAIC coursework. For any Kaizen event it is important that the right tools be applied in creative ways to ensure that the team’s time is used most effectively and that the tools produce useful results. This is the part that can make Kaizen event facilitation particularly challenging, but the challenges can be transformed into opportunities with a little preparation and practice.

About the Author: Robert Tripp is a frequent contributor to iSixSigma.com and an associate with Six Sigma Advantage. He was part of the "original DNA" of AlliedSignal's groundbreaking Six Sigma program. He has trained, coached and certified hundreds of business professionals, managers, engineers and senior leaders in Six Sigma. He can be reached at r.b.tripp@att.net.

DMAIC

http://www.isixsigma.com/me/dmaic/

IDOV

Design for Six Sigma - IDOV Methodology

By Dr. David Woodford

Design for Six Sigma (DFSS) can be accomplished using any one of many methodologies. IDOV is one popular methodology for designing products and services to meet six sigma standards.

IDOV is a four-phase process that consists of Identify, Design, Optimize and Verify. These four phases parallel the four phases of the traditional Six Sigma improvement methodology, MAIC - Measure, Analyze, Improve and Control. The similarities can be seen below.

Identify Phase
The Identify phase begins the process with a formal tie of design to Voice of the Customer. This phase involves developing a team and team charter, gathering VOC, performing competitive analysis, and developing CTQs.

Crucial Steps:

Identify customer and product requirements

Establish the business case

Identify technical requirements (CTQ variables and specification limits)

Roles and responsibilities

Milestones

Key Tools:

QFD (Quality Function Deployment)

FMEA (Failure Means and Effects Analysis)

SIPOC (Supplier, Input, Product, Output, Customer product map)

IPDS (Integrated Product Delivery System)

Target Costing

Benchmarking

Design Phase
The Design phase emphasizes CTQs and consists of identifying functional requirements, developing alternative concepts, evaluating alternatives and selecting a best-fit concept, deploying CTQs and predicting sigma capability.

Crucial Steps:

Formulate concept design

Identify potential risks using FMEA

For each technical requirement, identify design parameters (CTQs) using engineering analysis such as simulation

Raw materials and procurement plan

Manufacturing plan

Use DOE (design of experiments) and other analysis tools to determine CTQs and their influence on the technical requirements (transfer functions)

Key Tools:

Smart simple design

Risk assessment

FMEA

Engineering analysis

Materials selection software

Simulation

DOE (Design of Experiments)

Systems engineering

Analysis tools

Optimize Phase
The Optimize phase requires use of process capability information and a statistical approach to tolerancing. Developing detailed design elements, predicting performance, and optimizing design, take place within this phase.

Crucial Steps:

Assess process capabilities to achieve critical design parameters and meet CTQ limits

Optimize design to minimize sensitivity of CTQs to process parameters

Design for robust performance and reliability

Error proofing

Establish statistical tolerancing

Optimize sigma and cost

Commission and startup

Key Tools:

Manufacturing database and flowback tools

Design for manufacturability

Process capability models

Robust design

Monte Carlo Methods

Tolerancing

Six Sigma tools

Validate Phase
The Validate phase consists of testing and validating the design. As increased testing using formal tools occurs, feedback of requirements should be shared with manufacturing and sourcing, and future manufacturing and design improvements should be noted.

Crucial Steps:

Prototype test and validation

Assess performance, failure modes, reliability, and risks

Design iteration

Final phase review

Key Tools:

Accelerated testing

Reliability engineering

FMEA

Disciplined New Product Introduction (NPI)