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Engineering

Management

MSE507
Lean Manufacturing

Learning to See Parts I, II, III


A Value Stream Mapping Workshop
Mike Rother & John Shook
Lean Enterprise Institute

Value Stream Mapping

Workshop Goals

To understand the complete value stream


To introduce Value Stream Mapping (VSM)
To draw a current state map

Learn the mapping concepts and icons

To be able to design an improved value stream


Develop the ability to see the flow of a value stream

To draw a future state map


Learn the mapping concepts and icons

Value Stream Mapping

Topics

Topic

Slide No.
Overview
The Process (Steps 1-3)
The Process (Step 4 Case Study)
The Process (Step 5)
The Process (Step 6)
The Process (Step 6 Case Study)
The Process (Steps 7-9)
The Process (Step 10)
Conclusions

5
12
35
38

Engineering
Management

Value Stream Mapping

Overview

Overview
Why? Learn to See
See the big picture, not just individual processes
See how the process currently operates
See linkages between information and material flow
See the waste and the source of waste
Establish a common language for improvement
Foundation for designing lean flow and the future state

Overview
What do you typically see?
80 90% of total steps are waste from standpoint of end
customer
99.9% of throughput time is wasted time
Demand becomes more and more erratic as it moves
upstream, imposing major inventory, capacity, and
management costs at every level
Quality becomes worse and worse as we move upstream,
imposing major costs downstream
Most managers and many production associates expend the
majority of their efforts on hand-offs, work-arounds, and
logistical complexity

Overview
Objective
Correct specification of value
Elimination of wasteful steps
Flow where you can
Pull where you cant
Management toward perfection

Overview
Pursue Perfection
Every step in each process is:
Capable right every time (6 Sigma)
Available always able to run (TPM)
Adequate with capacity to avoid bottlenecks (right-sized tools &
lean system design)

Overview
What is it?
A visual representation of all the steps needed for:
Concept to launch (design)
Order to delivery (build)
Delivery to recycle (sustain)

All steps:
Value Added (VA)
Non-value added (NVA)

Two flows:
Orders traveling upstream from the customer
Products traveling downstream to the customer

Overview
Who does it?
Value Stream Manager
Ideally, one person with lead responsibility for the entire value
stream reporting to the top person at the site

Representatives of every relevant function operations,


purchasing, sales, finance, engineering, etc. (ideally)
And you

When?
Now
Before any major improvement activity
Constantly updated to the new Future State

Overview
Where?
In the work area itself
How?
Directly observe flow of information and physical goods
Summarize these flows visually with icons
Use pencil and paper
And most important
Envision future state
No wasted steps
Smooth flow
Level pull

Engineering
Management

Value Stream Mapping

The Process

Getting Started

Select one value stream - a product family


Walk the physical flow of material no data collection
Walk the flow again, collecting data
Draw the Current State Map
Identify opportunities to eliminate waste and create flow
Draw the Future State Map
Generate a Value Stream Plan
Start making the improvements
Conduct Value Stream Reviews
Repeat the cycle

Value Stream Step 1

Select a Value Stream

Select one value stream shared definition of value

by customer or customer category


by product or product family
by plant
by service - production, spares, repair

A family is a group of items that pass through similar


processing steps and over common equipment.

Focus on the downstream processes not upstream steps.


Upstream processes may serve many product families in a
batch mode.

Value Stream Step 1

Create a Matrix

Create a matrix if your mix is complicated

Assembly and Equipment


1
2
3
4
5
6
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X

P ro d u c t s
FEDCBA

A Product
Family

Create a Matrix

Complicated

Weight part by machine used.

Machine
Machine A
Machine B
Machine C
Machine D
Machine E
Machine F
Machine G
Machine H
Machine I
Machine J
Machine K
Machine L

Part
Weighting
2
4
8
16
32
64
128
256
512
1024
2048
4096
Part Total

Part 1

Part 2

Part 3

Part 4

Part 5

Part 6

Part 8

1
1

1
1

1
1

1
1

1
1

290

Part 7

1
1

80

132

0103-02 Family Matrix.xls

258

1
1

88

132

288

132

Create a Matrix

Complicated

Sort by weighted part; Weight machine by part used.

Machine
Machine A
Machine B
Machine C
Machine D
Machine E
Machine F
Machine G
Machine H
Machine I
Machine J
Machine K
Machine L
blank

Part Part 2
Part 5
Part 3
Part 6
Part 8
Part 4
Part 7
Part 1
Weighting
32
64
128
256
512
1024
2048
4096
2
1
1
4
1
1
1
8
1
16
1
1
32
1
1
64
1
1
128
1
1
1
256
1
1
1
512
1024
2048
4096
blank
80
88
132
132
132
258
288
290

Machine
Total
blank
5120
896
64
96
6144
96
896
7168
0
0
0
0
blank

Create a Matrix

Complicated

Sort by weighted machine.

Part
Machine Weighting
Machine C
8
Machine D
16
Machine F
64
Machine B
4
Machine G
128
Machine A
2
Machine E
32
Machine H
256
blank
blank

Part 2

Part 5

32

64

Part 3
128

Part 6
256

Part 8
512

Part 4
1024

Part 7
2048

1
1
1

1
1

1
1

1
1

1
1
1

80

88

132

132

132

1
258

1
1
288

Machine
Total
4096 blank
64
96
96
896
896
1
5120
1
6144
1
7168
290 blank

Part 1

Value Stream Step 1

Levels of a Value Stream

You can value stream map at


different levels
Across companies is too
complicated to start with

Start mapping door-to-door


within your own facility:
This is under your control
It is easier to make
improvements immediately

Expand outward to broaden the


value stream later

Process Level

Single Plant
(Door-to-door)

Multiple Plants

Across Companies

Value Stream Step 2


Walk the Flow

Let the workers know what you are doing.

Walk the flow first (no data collection). Walk it yourself.

Begin at shipping and work upstream. This begins with the


processes that are linked closer to the customer. If it is too
confusing, start at the beginning and go downstream.

See how the material moves.

See the piles of material and WIP.

See how people work.

Identify the major process steps

Value Stream Step 3


Walk the Flow Again

Walk the flow again, this time collecting data.

Begin at shipping and work upstream.

Obtain the data yourself, do not rely on computer printouts.


Use pencil and paper.

Ask questions and listen.

Collect data relevant to the definition of value.

Value Stream Step 3

Walk the Flow Again-Typical Data Collected


Customer Need
Demand number of units per day the customer wants
Available work time Scheduled work time minus breaks,
meetings and clean up time
Inventory
WIP Number of units waiting to be worked on or waiting to be
moved.
Finished Goods Number of units in stores or waiting to be
shipped.

Value Stream Step 3

Walk the Flow Again-Typical Data Collected


Each Process Step
Cycle time CT The time between one part coming off the
process and the next part coming off.
Yield First Time Yield or scrap%
Number of people Required to operate the process.
Uptime The percentage of time the equipment is available to
run, when it is needed to be run
Batch Size typical lot size or minimum
Change Over Time Co The time from the last good piece
of one batch to the first good piece of the next batch
EPE Every part every __. How often do you changeover to
produce this part?

Value Stream Step 3

Walk the Flow Again-Calculated Data

Takt Time TT How often does the customer need another


unit.
(Available work time per day)/(demand per day)

Inventory measured in days.


(Number of units)/(demand per day)

Overall Flow
Process Lead Time The time for a unit to make it all the way
through the process
(Sum of Inventory Days) + (Sum of Cycle Times)

Processing Time The time spent actually performing work on


the unit
(Sum of Cycle Times)

Value Stream Step 3

Draw the Current State Map

Drawing the future state map begins with the current


production situation.

Symbols and icons assure a consistent language.

Draw the rough draft as you walk the floor in step 3 collecting
data.

Use pencil and paper, not a computer.

Map the whole value stream, not just a segment.

Example

PROCESS BOX ICONS

DATA BOX ICONS


- C/T time
- C/O time
- Up time
- Scrap

Information Flow

Example

INVENTORY ICONS
WITH PUSH ARROWS

Material Flow

Quiz 1

Circle the best answer


1. Value Stream Mapping looks at
A.
B.
C.
D.

The people, materials, and information flow in a value stream


The material and information flow in a value stream
The detailed operation steps within a cell
The steps that people take in designing and producing a product

2. A product family is used to:


A. Create a listing of all your products and the steps that are taken to
produce them
B. Decide which customers are most important to your customers
C. Identify and group products into families based upon whether they
pass through similar steps in your downstream processes
D. Divide the mapping teams up into groups with individual mapping
assignments

Quiz 2

Circle the best answer


3. The best way to draw a value stream map is:
A. In pencil on the work floor, mapping the whole value stream
B. In your office with a good drawing software package
C. In pencil, by dividing the value stream into segments, and
assigning each segment to a different mapping team
D. In pencil, on the floor using standard times from engineering

4. Data boxes should contain data based on:


A.
B.
C.
D.

Engineering standards
The average measurement for a fiscal year
The measurement on an ideal day
What you observe as you draw the map

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 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

ACME Stamping
Case Study

Material Flow Icons

Assembly
XYZ
Corporation
Process
Box

Supplier/
Customer

C/T=45 sec.
C/O=30 min.
3 Shifts.
2% Scrap

300 pieces
1 day

Data Box

Inventory

Mon
+ Wed
Shipment

Supermarket

FIFO
Push

Physical
Pull

Finished Goods
to Customer

First-In-First-Out

Information Flow Icons

Manual
Information Flow

Withdrawal
Kanban

Electronic
Information Flow

Production
Kanban

Weekly
Schedule

OXOX

Schedule

Load
Leveling Box

Signal
Kanban

Sequenced-Pull
Ball

Kanban
Post

General Icons

Uptime
Changeover

Operator

Kaizen
Lightning Burst
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

First - Show the


Customer

Value Stream Step 4

Current State Map - 1st View


State St.
Assembly

18,400 pcs/mo
-12,000 L
-6,400 R
Tray=20 pcs.
2 Shifts

Second - add the


major Processes,
Data Boxes, and
Inventory Triangles

Value Stream Step 4

Current State Map - 2nd View


State St.
Assembly

18,400 pcs/mo
-12,000 L
-6,400 R
Tray=20 pcs.
2 Shifts

Coils
5 days

Stamping

CT=1sec.
Co=1 hr.
Uptime=85%
27,600 sec. avail
EPE=2 weeks

S. Weld # 1

4600 L
2400 R

S. Weld # 2

1100L
600 R
CT=39sec
.Co=10 min.
Uptime=100%
2 shifts
27,600 sec.avail

Assy # 1

1600 L
850 R
CT=46sec
.Co=10 min.
Uptime=80%
2 shifts
27,600 sec.avail

Assy # 2

1200 L
640R
CT=62sec
.Co=0
Uptime=100%
2 shifts
27,600 sec.avail

The data obtained is put in the data box


directly beneath the process box.

2700 L
1440 R
CT=40sec
.Co=0
Uptime=100%
2 shifts
27,600 sec.avail

Shipping

Third - Show the


Material Flow

Value Stream Step 4

Current State Map - 3rd View

The supplier of raw material is


identified with a factory icon. In
this case they deliver 500 ft coils

Michigan
Steel Co.

State St.
Assembly

18,400 pcs/mo
-12,000 L

500 Ft. Coils

-6,400 R
Tray=20 pcs.
Tues &
Thurs.

2 Shifts

A truck icon and broad arrow indicate


movement of finished goods to the
customer and raw material to the site.
I

Stamping

4600 L
Coils
2400 R
5 days CT=1sec.
Co=1 hr.
Uptime=85%
27,600 sec. avail
EPE=2 weeks

S. Weld # 1

S. Weld # 2

1100L
600 R

Assy # 1

1600 L
850 R

1X
Daily

Assy # 2

2700 L
1440 R

1200 L
640R

CT=39sec
.Co=10 min.

CT=46sec
.Co=10 min.

CT=62sec
.Co=0

CT=40sec
.Co=0

Uptime=100%
2 shifts
27,600 sec.avail

Uptime=80%
2 shifts
27,600 sec.avail

Uptime=100%
2 shifts
27,600 sec.avail

Uptime=100%
2 shifts
27,600 sec.avail

Shipping

Value Stream Step 4

Current State Map

Information flow is drawn from right to left in the top half of


the map space.
solid line arrows (paper transfer)
arrow with a lightening bolt (electronic transfer)

Material movements that are pushed are represented by a


striped arrow
PUSH
A process that produces regardless of the needs of the
downstream customer
A guess as to what is needed (forecasts)
Processes are allowed to set batch sizes and produce at a pace
that makes sense from its perspective not the customers.

Fourth - show
Information Flows
& Push Arrows

Value Stream Step 4

Current State Map 4th View

y
ekl
e
W ax
F

Michigan
Steel Co.

90/60/30 day
Forecasts

Production
Control

6 WEEK
Forecast

MRP

Daily
Order

State St.
Assembly

18,400 pcs/mo
-12,000 L
-6,400 R
Tray=20 pcs.

500 ft. Coils


WEEKLY SCHEDULE

2 Shifts
Tues &
Thurs.
1X
Daily
I

Coils
5 days

Stamping

S. Weld # 1

4600 L
2400 R
CT=1sec.
Co=1 hr.
Uptime=85%
27,600 sec. avail
EPE=2 weeks

S. Weld # 2
I

CT=39sec
.Co=10 min.
Uptime=100%
2 shifts
27,600 sec.avail

1100R
600 R

Assy # 1
I

CT=46sec
.Co=10 min.
Uptime=80%
2 shifts
27,600 sec.avail

Assy # 2
I

1600 L
850 R CT=62sec
.Co=0

Shipping
I

2700 L
1200 L
1440 R
640R CT=40sec
.Co=0
Uptime=100%
Uptime=100%
2 shifts
2 shifts
27,600 sec.avail
27,600 sec.avail

Value Stream Step 4

Current State Map

The timeline summarizes the current condition of the value


stream

Production Lead-Time is the time it takes for a part to make its


way through the shop floor beginning with the raw material

Inventory Lead-time( shown with the inventory triangles)is


calculated as follows:
Inventory quantity divided by the daily customer requirements.
Then add all process inventory lead-times.

Inventory Quantity
Daily Customer Requirement

Fifth (Final) - Show


Timeline

Value Stream Step 4

Current State Map 5th View

y
ekl
e
W ax
F

Michigan
Steel Co.

90/60/30 day
Forecasts

Production
Control

6 WEEK
Forecast

MRP

State St.
Assembly

Daily
Order

18,400 pcs/mo
-12,000 L
-6,400 R
Tray=20 pcs.

500 ft. Coils


WEEKLY SCHEDULE

2 Shifts

Tues &
Thurs.

1X
Daily
I

Coils
5 days

Stamping

S. Weld # 2

Assy # 1

4600 L
2400 R
CT=1sec.
Co=1 hr.
Uptime=85%
27,600 sec. avail
EPE=2 weeks

5
days

S. Weld # 1

CT=39sec
.Co=10 min.
Uptime=100%
2 shifts
27,600 sec.avail

1 7.6 days
sec

1100R
600 R

CT=46sec
.Co=10 min.
Uptime=80%
2 shifts
27,600 sec.avail

1.8 days
39 sec

Shipping

1600 L
850 R CT=62sec
.Co=0

1200 L
640R CT=40sec
.Co=0
Uptime=100%
Uptime=100%
2 shifts
2 shifts
27,600 sec.avail
27,600 sec.avail

2.7 days
46 sec

Assy # 2

2 days
62 sec

40 sec

2700 L
1440 R

(PLT)
4.5 days=23.6 days
(PT)
=188 sec

Fifth (Final) - Show


Timeline

Value Stream Step 4

Current State Map Complete View

y
ekl
W e ax
F

Michigan
Steel Co.

90/60/30 day
Forecasts

Production
Control

6 WEEK
Forecast

MRP

State St.
Assembly

Daily
Order

18,400 pcs/mo
-12,000 L
-6,400 R
Tray=20 pcs.

500 ft. Coils


WEEKLY SCHEDULE

2 Shifts

Tues &
Thurs.

1X
Daily
I

Coils
5 days

5
days

Stamping

S. Weld # 1

4600 L
2400 R
CT=1sec.
Co=1 hr.
Uptime=85%
27,600 sec. avail
EPE=2 weeks

S. Weld # 2

Assy # 1

CT=39sec
.Co=10 min.
Uptime=100%
2 shifts
27,600 sec.avail

1 7.6 days
sec

1100R
600 R

CT=46sec
.Co=10 min.
Uptime=80%
2 shifts
27,600 sec.avail

1.8 days
39 sec

Shipping

1600 L
850 R CT=62sec
.Co=0

1200 L
640R CT=40sec
.Co=0
Uptime=100%
Uptime=100%
2 shifts
2 shifts
27,600 sec.avail
27,600 sec.avail

2.7 days
46 sec

Assy # 2

2 days
62 sec

40 sec

2700 L
1440 R

(PLT)
4.5 days=23.6 days
(PT)
=188 sec

Whats wrong with Acmes Value


Stream?

3 VA processes
Traditional mass
production
thinking about
economies of
scale
Batches pushed
through
=> waste
Look at VA time
compared to
time in plant

What Makes a Value Stream Lean?

Primarily the elimination of the number one waste


OVERPRODUCTION!!!

Since this material is not yet needed it must be handled,


counted, stored.

Defects remain hidden in inventory queues

Overproduction results in shortages, because processes are


busy making the wrong things.

Value Stream Step 5

Eliminate Waste

1.
2.
3.
4.
5.
6.
7.

Overproduction
Waiting
Transportation
Unnecessary Processing
Inventory
Unnecessary Motion
Correction

Wasting

A Persons time or talent

Value Stream Step 5

Eliminate Waste

1.

Overproduction - The primary waste

2.

Waiting

3.

Making parts faster than is required


Excess Inventory
Time wasted, that could be used to make product that is
required

An operator waiting for a long machine cycle to end

Transportation

Moving parts and products does not add value - it just adds cost

Value Stream Step 5

Eliminate Waste

4.

Unnecessary Processing

5.

Booking work into a store and then having to book it back out
again to use.

Inventory

There is a cost to the Company for carry inventory


There is always the risk it can become obsolete
It covers up other inefficiencies
e.g. Long set-up times

Value Stream Step 5

Eliminate Waste

6.

Unnecessary Motion

Any motion of a person that does not add value

7.

Correction

Operators / Setters looking for tooling

Reworking defective materials

Things to remember about waste

It is a symptom rather than a root cause of the problem


It points to problems within the system, at both process and value
stream levels
We need to find and address the causes of the waste

Value Stream Step 5


And Create Flow
We are concerned with system efficiency rather than
the efficiency of an individual process

The question is, how fast should we produce?

Value Stream Step 5

Takt Time

We should match the rate of production to the rate of sales

Takt is the German word that means beat or pace


Takt Time

= Effective working time per day


Customer requirement per day
= 27,000 sec = 59 sec
460 pieces

What is the effective working time per day?


What do we do about machine down time?
Why is cycling faster than takt expensive?

Value Stream Step 5

What is Flow?

Value Stream Step 5

Where Do We Use Flow?

Use continuous flow wherever possible

Where cant we use continuous flow?

Long set-ups
Large distances
Downtime problems
Long lead-times

Value Stream Step 5

Alternatives to Continuous Flow

Kanban

Two-bin

Bins used to regulate production

Buffer stock

A signal that provides an instruction to regulate the sequence and


timing of production

Standard work
Curtain operation

Supermarket

Controlled quantity of inventory


Visual controls
Owned by the supplier

Value Stream Step 5

Supermarket Pull System

A SUPERMARKET PULL SYSTEM


PURPOSE: Controls production at supplying process without trying to schedule. Controls
production between flows
Production KANBAN

Withdrawal KANBAN

Supplying
Process

Customer
Process
PRODUCT

1) CUSTOMER

Supermarket

Value Stream Step 5

Supermarket Pull System

A pull system between processes


gives accurate build instructions to the upstream process
without trying to predict downstream demand
instead of forecasting the upstream process.

The pull by the downstream process determines


what the upstream produces
when
and in what quantity.

Should be located near the supplying process

Are only used when continuous flow will not work.

There is a cost - inventory and material handling

Value Stream Step 5

Schedule Only One Point

If pull systems schedule upstream process we can try to


schedule only one point in the value stream - Pacemaker
No supermarkets downstream of the schedule point
(except finished goods)
schedule

schedule

Quiz 3

Circle the best answer


5. Takt time is:
A. The customer demand rate
B. The rate at which the Sales departments plan to sell products to
customers based upon promotions
C. The fastest rate at which your individual operations can produce the
products
D. The average amount of product brought by your customers in a week

6. A supermarket is used where:


A. Processes are close together but have different cycle times
B. A customer requires specialised products from a finished goods
warehouse
C. Continuous flow is not possible due to distance, unreliability, or where
processes serve multiple product families
D. Pull can be implemented throughout the door-to-door value stream

Quiz 4

Circle the best answer


7. A pacemaker process:
A. Ensures that all processes downstream are controlled by supermarket pull
systems
B. Receives its products from supermarkets controlled by MRP systems
C. Is always a bottleneck, requiring constant supervision and staff adjustment
D. Responds to the external customer, and is usually the point at which
production is scheduled in the door-to-door value stream

Homework Assignment

Questions:
1. Describe the ways a business could use Value-stream
mapping. What will be the benefits?
2. You are visiting a production plant that has achieved
excellence and is a model site to bench mark in the industry.
List what you are likely to see when visiting a lean plant?
How will their current Value Stream might look like?

Read Leaning to See Parts IV and V


Pages 57-101

Questions? Comments?