Learning Objectives
Participants will learn:Wh t V l St M i d h t it i t What a Value Stream Map is – and what it is not.
Key differences between manufacturing and office/service VSMs.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 mapsstate maps. How to create an implementation plan from the future
state VSM.
© 2010 Karen Martin & Associates 2
Value Stream Administrative & OfficeValue Stream Mapping’s Beginnings
Administrative & Office Environments
Learning to See, The Complete Lean Enterprise, Mike Rother & John Shook Beau Keyte & Drew Locher
Womack’s Five Principles of a Lean Enterprise
Value Value stream Flow Flow Pull Perfection
Jim Womack Lean Thinking 1996 2003— Jim Womack, Lean Thinking, 1996, 2003
© 2010 Karen Martin & Associates 4
Value Stream Defined
Value Stream: All of the activities, required to fulfill a customer request from order to deliveryfulfill a customer request from order to delivery (and beyond to cash received).
Value Stream
Process ProcessProcess
Customer
CustomerRequest
CustomerReceipt
© 2010 Karen Martin & Associates 5
The Work We Do:Degrees of Granularity
Value Value StreamRooftop Value Stream
Value Stream Map
pView
(Strategic)
Process Process Process
Step Step StepIn the Weeds
(Tactical)
Metrics-Based Process Map
© 2010 Karen Martin & Associates 6
( )
Improvement Roles
Who? Accountability Tool
Leadership “What has to happen” Value Streamateg
ic
Leadership What has to happen Value Stream MappingSt
ra
Middle
Workforce “How it will happen” Kaizen Eventscal
Management
Workforce How it will happen” Kaizen Events, Just-do-its, and ProjectsTa
ctic
© 2010 Karen Martin & Associates 7
Why Value Stream Mapping?
To set strategy before diving into t titactics. The future state VSM is a macro
level blueprint for change; road maplevel blueprint for change; road mapEnables us to SEE the process.Promotes s stems thinking /Promotes systems thinking /
seeing the wholeHelps us avoid sub optimizing Helps us avoid sub-optimizing
© 2010 Karen Martin & Associates 8
VSM Goal: System Efficiency
System Efficiency = Optimal Value Stream
Performance
Individual Efficiency =
Performance
Individual Efficiency = Sub-optimization
© 2010 Karen Martin & Associates 9
Types of Value Streams
Product Value StreamsSupport Value StreamsValue Stream “Segments”
© 2010 Karen Martin & Associates 10
Types of Value Streams
Product Value Streams Goods – wide range of manufactured productsg p 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 oil field maintenance Repair and maintenance – wind blade repair, oil field 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
© 2010 Karen Martin & Associates
Etc.
11
Types of Value Streams (continued)
Value Stream “Segments” Order fulfillment Order fulfillment Product development New account set-up
Laboratory services Laboratory services Imaging services
Support Value Streams Recruiting, hiring and onboarding process Revenue cycle Information Technology request fulfillment Purchasing Accounts payable Physician credentialing
© 2010 Karen Martin & Associates 12
Why Value Stream Mapping? (continued)
Shows the linkage between i f ti d t i l flinformation and material flow.Makes the disconnects and
b t l t fl i ibl tobstacles to flow visible at a macro levelM t i b d d i i kiMetrics-based decision making:
What are you going to do to affect the numbers?affect the numbers?
© 2010 Karen Martin & Associates 13
Key Metrics: Time
Process time (PT)Th ti it t k t t ll f th k if i The time it takes to actually perform the work, if one is able to work on it uninterrupted
Includes task-specific doing, talking, and thinking Includes 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 it’s completed and passed on to the next person or d t t i th h idepartment in the chain
aka throughput time, turnaround time, elapsed time Includes Process Time not merely waiting time
© 2010 Karen Martin & Associates
Includes Process Time, not merely waiting time.
14
Lead Time vs. Process TimeScenario 1
Lead TimeLead Time
Work Received
Work passed to next step
Process Time
LT = PT + Waiting / Delays
© 2010 Karen Martin & Associates 15
g y
Lead Time vs. Process TimeScenario 2
Lead Time
Process TimeWork
ReceivedWork passed to next step
LT = PT + Waiting / Delays
© 2010 Karen Martin & Associates 16
g y
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 or non value adding)(whether value-adding or non-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.
© 2010 Karen Martin & Associates 17
Key Metrics: Quality
%Complete and Accurate (%C&A) The percentage of input that’s deemed “usable as is”
by the person doing the work % of incoming work where the downstream customer % 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
© 2010 Karen Martin & Associates
Similar to first pass yield in 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 requiredno rework required.
RFPY = %C&A x %C&A x %C&A…C fi di 0 15% Common finding = 0-15%
Multiply ALL %C&A’s, even if parallel processes
© 2010 Karen Martin & Associates 19
Current State Value Stream MapPurchasing — Non-repetitive purchases less than $5,000
Originator
Inititate Req.
PT = 10 mins.C&A = 10%
31
Hard CopySupplies
1
Form File
File Maker
ERP
Quicken
Vendor Website
Excel
Hard Copy
Data Entry
Finance
Review Budget
PT 5 i
6
Corp Purchasing Manager
Approve in ERP
PT 5 i
1Supervisor
Review Req.
PT 5 i
2
Sys Engineer
Review Requisition
1IS Manager
Review Requisition
PT 5 i
1Financial Mgr
Review Requisition
PT 10 i
1
Admin Asst
Enter Requisition
PT 15 i
1
20 ReqsExternal Supplier
PT 20 i
Corp Purchasing
Submit PO to Supplier
6
10 Reqs 63 Reqs2 3 4 5 6 7 8 9 10
PT = 5 mins.C&A = 60%
PT = 5 mins.C&A = 90%
0.25 days
5 mins.
0.5 days
5 mins.
5 days
5 mins.
1 days
5 mins.
1 days
10 mins.
0.5 days
15 mins.
3 days
5 mins.
7 days
15 mins.
10 days LT = 28.4 days
PT = 65 mins.
AR = 0.477%
PT = 5 mins.C&A = 95%
PT = 5 mins.C&A = 90%
PT = 5 mins.C&A = 100%
PT = 10 mins.C&A = 95%
PT = 15 mins.C&A = 98%
4 hrs. 40 hrs. 8 hrs. 8 hrs. 24 hrs. 56 hrs.2 hrs. 4 hrs. PT = 20 mins.PT = 15 mins.C&A = 98%
RFPY = 4.2%
PT = Process Time LT = Lead Time
80 hrs.
Customer Demand:615 requisitions per y ear
C&A = % Complete & Accurate AR = Activ ity Ratio (PT/LT x 100) RFPY = Rolled First Pass Y ield
Future State Value Stream MapPurchasing — Non-repetitive purchases less than $5,000
Originator
Enter Req.in ERP
PT=30 mins.
31
AdditionalIT access
Integrate Form File with File
Maker
1
C&A = 85%
File Maker
ERP
Vendor Websites
Requisition Checklist
Supplies
Standard Work for review
CrossTraining
Auto Notify
Use budget in place of Quicken
Approval
Dept
Approve in ERP
Review Req.
AdditionalIT access
External Supplier
DedicatedBuyersPlace
Order2 3 4 5
Dept. Manager
PT=5 mins.C&A = 90%
1
0.5 days
5 mins.
0.75 days
5 mins.
1 days
20 mins.
10 days LT = 12.3 days
PT = 30 mins.AR = 0 508%
Supervisor
PT=5 mins.C&A = 95%
2 8 hrs.6 hrs.
PT=20 mins.4 hrs.
Corp Purchasing
PT=20 mins.C&A = 98%
6 80 hrs.
Customer Demand:615 requistions per year
AR 0.508%
PT = Process Time LT = Lead Time C&A = % Complete & Accurate AR = Activity Ratio (PT/LT x 100) RFPY = Rolled First Pass Yield
RFPY = 71%
Purchasing ProcessProjected Results
M t iCurrent
St tProjected
F t St t%
I tMetric State Future State ImprovementLead Time 28.4 days 12.3 days 56.7%Process Time 65 mins 30 mins 53 8%Process Time 65 mins 30 mins 53.8% % Activity 0.48% 0.51% 6.3%Rolled FirstRolled First Pass Yield 4.2% 71.0% 1,590%
# Handoffs 10 5 50%# IT Systems 6 3 50%Freed capacity 2.1 FTEs 10%
© 2010 Karen Martin & Associates
Summary Metrics: Measuring Productivity Gains
Labor EffortTotal PT (in hrs) X # occurrences/year
# FTEsAvailable work hrs/year/employee
=Available work hrs/year/employee
Freed Capacity = Current State FTEs – Future State FTEs
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
© 2010 Karen Martin & Associates 23
What do you do with freed capacity?
Absorb additional work without increasing staff Reduce payroll through natural attrition Reduce payroll through natural attrition Innovate – create new revenue streams Conduct ongoing continuous improvement activities D b tt j b ith f d hi h f t Do a better job with fewer errors and higher safety Talk and work with your customers and suppliersMentor staff to create career growth opportunities Provide additional workforce development; cross-train Better work/life balance Slow down & think Slow down & think Get/stay caught up Do the things you haven’t been able to get to Collaborate with other areas
© 2010 Karen Martin & Associates
Collaborate with other areas
24
Basic Mapping IconsExternal
Push ArrowOperator / Employee
External Organization
Material receipts & shipments
Work-in-Process
I
ManualInformation Flow
Go See SchedulingProcess Block
C/O 40PT= 25 m
ElectronicInformation
2 ShiftsTakt= 60m
C/O= 40 m
Data BlockMovementby Truck
In-box
InformationFlow
Data Block y
Hours HoursHoursLead Time
Minutes MinutesMinutesMinutesProcess Time
Timeline
Current State Value Stream Map Outpatient Imaging Services
Demand = 15 per day
Customer Demand:Customer Demand:15 patients per Day
(Takt Time 1920 seconds)8 hours per day
Referring Physician
% C&A = 65 %
Hospital
ScheduleAppointment
Cycle Time = 11 mins.Lead Time = 12 mins.%C&A= 98%
6
Pre-register Patient
Cycle Time = 30 mins.Lead Time = 990 mins.%C&A= 100 %
5 Lead Time = 12 mins.Lead Time = 990 mins.Lead Time = 24 days1234
% C&A = 98 %% C&A = 100 %
CT=Cycle Time LT=Lead Time %C&A=% Complete & Accurate
E Pay Excel ADSSymposium InternetWaiting RoomM t
Fax OrderSolutions
PACSMeditech Auto Fax 50%
ManagementSystem
Us Mail 25%MD Mailbox 25%
Rework Loop via Fax 25% of the time
Check-in Patient
(Admitting)
Send Reports
(Imaging)
6
5 mins.
PrepPatient(Tech)
2
Check-inPatient
(Imaging)
CompleteExam(Tech)
2
TransmitImages(Tech)
2
Read/DictateExam
(Radiologist)
2
TranscribeReport (MDI)
6
ReviewDraft/Sign
(Radiologist)
2
PrintReports
(Imaging)
230 mins. 5 mins. 248 mins. 365 mins. 960 mins. 110 mins. 120 mins.45 mins.5 mins5 6 7 8 9 10 11 12 13 14Cycle Time = 2 mins.% C&A = 90 %
5Cycle Time = 3 mins.% C&A = 90 %
6
0.0833 hrs.
2 mins.
0.0833 hrs.
1 mins.
0.75 hrs.
10 mins.
0.5 hrs.
15 mins.
0.0833 hrs.
3 mins.
4.13 hrs.
15 mins.
6.08 hrs.
5 mins.
16 hrs.
1 mins.
1.83 hrs.
1 mins.
2 hrs.
3 mins.
LT = 32.5 hrs.
CT = 56 mins.CT/LT Ratio = 2.87%
Cycle Time = 10 mins.% C&A = 100 %
2
Cycle Time = 1 mins.% C&A = 98 %
3Cycle Time = 15 mins.% C&A = 90 %
2
Cycle Time = 3 mins.% C&A = 100 %
2
Cycle Time = 15 mins.% C&A = 95 %
2
Cycle Time = 5 mins.% C&A = 75 %
6
Cycle Time = 1 mins.% C&A = 95 %
2
Cycle Time = 1 mins.% C&A = 99 %
245 mins.5 mins.5 6 7 8 9 10 11 12 13 14
Rolled First Pass
VSM Champion: Paul Scanner Created: July 17, 2007
yield = 29%
Future State Value Stream Map Outpatient Imaging Services
Demand = 15 per day
Referring Physician
% C&A = 85 %
Hospital
Schedule apptPre-register
Cycle Time = 11 mins.Lead Time = 45 mins
6 Lead Time = 45 mins.Lead Time = 15 days
Co-locate
StandardWork
Work Balance
Customer Demand:15 patients per Day
(Takt Time 1920 seconds)8 hours per day
123
Lead Time = 45 mins.% C&A = 98 %
CT=Cycle Time LT=Lead Time %C&A=% Complete & Accurate
E Pay ExcelSymposium InternetWaiting Room
Fax OrderSolutions
PACS Auto Fax 80%
Risk Reduction
(Joint Commision)
Meditech
a g ooManagement
System
Solutions
Remove Check in
and ReduceSystem Access
Work B l i
Pull System(Supplies Kanban)
VisualBatch
R d ti
5S
Value StreamAlignment
Us Mail 15%MD Mailbox 5%
Rework Loop via Fax 10% of the time
Send Reports
(Imaging)
6
PrepPatient(Tech)
2
Check-inPatient
(Imaging)
3
CompleteExam(Tech)
2
TransmitImages(Tech)
2
Read/DictateExam
(Radiologist)
2
ReviewDraft/Sign
(Radiologist)
2
PrintReports
(Imaging)
220 mins. 5 mins. 120 mins. 420 mins. 2 mins. 30 mins.35 mins.5 mins.
Set-upReduction
System Access
Balancing
StandardWork
VisualWorkplace
Voice Recognition
Reductions
ContinuousFlow
4 5 6 7 8 9 10 11
Cycle Time = 3 mins.% C&A = 90 %
0.0833 hrs.
1 mins.
0.583 hrs.
10 mins.
0.333 hrs.
10 mins.
0.0833 hrs.
2 mins.
2 hrs.
15 mins.
7 hrs.
1 mins.
0.0333 hrs.
1 mins.
0.5 hrs.
3 mins.
LT = 11.3 hrs.
CT = 43 mins.CT/LT Ratio = 6.32%
Cycle Time = 10 mins.% C&A = 100 %
Cycle Time = 1 mins.% C&A = 98 %
3Cycle Time = 10 mins.% C&A = 90 %
Cycle Time = 2 mins.% C&A = 100 %
Cycle Time = 15 mins.% C&A = 95 %
Cycle Time = 1 mins.% C&A = 95 %
Cycle Time = 1 mins.% C&A = 99 %
Rolled First Pass yield = 40%
VSM Champion: Paul Scanner Created: July 18, 2007
Outpatient ImagingProjected Results
MetricCurrent
StateProjected
Future State%
ImprovementMetric State Future State ImprovementLead Time 32.5 hrs 11.3 hrs 65%Process Time 56 mins 43 mins 23%Process Time 56 mins 43 mins 23%Percent Activity 2.9% 6.3% 117% Rolled First % % %Rolled First Pass Yield 29% 40% 38%
# Macro Steps 14 11 21%Tech turnover(annual) 100% 25% 75%
N t F d it (PT d ti ) ll d th i ti t
© 2010 Karen Martin & Associates 28
Note: Freed capacity (PT reductions) allowed the organization to earn $500,000 additional annual revenue with no additional headcount
Value Stream Mapping ProcessD fiDefine
Product Family
F d ti (th b i ) f th
Products (good or services) withcommon process steps
Document Current State
Foundation (the basis) for the future state; 70-80% accurate isacceptable (directionally correct)
Design Future State 3 Day
Event
Create flow by eliminating waste it is now obvious from yourcurrent state map); typically 3-6at Event months out
Rep
ea
Create Include accountability andti f f l ti
Th l f i !
Implementation Plan timeframes for completion
Implement! The goal of mapping!
Scoping: One VSM per “Product Family”
Group Product Families by similar downstream processes, steps or equipment.
Process Steps & Equipment
Step A Step B Step C Step D Step E Step F
Product X X X X XVol.
50ABC X X X X XProduct
XYZ X X X X X
5073
2Products
Product IBM X X X
Product AWR X X X X
2
5Product ACC X X X
Product X X X
15
12
© 2010 Karen Martin & Associates
SUB X X XProduct
IDR X X X X X X30
12
1
Narrowing the Scope: Selected Specific Conditions
Non-Exempt
Replacements
Non ExemptStaff
HiringProcess
Exempt Staff
ProcessNew
PositionsNon-Exempt
Staff
Exempt Staff
© 2010 Karen Martin & Associates 31
Staff
Narrowing the Scope: Selected Specific Conditions
C bl
Units
Domestic
Service Parts
Consumables
Non-
Warranty
Order Fulfillment
Process
Non-Warranty
Process
I t ti l C bl
Units
International
Service Parts
Consumables
Non
Warranty
© 2010 Karen Martin & Associates 32
Non-Warranty
Value Stream Mapping ProcessD fiDefine
Product Family
F d ti (th b i ) f th
Products (good or services) withcommon process steps
Document Current State
Foundation (the basis) for the future state; 70-80% accurate isacceptable (directionally correct)
Design Future State 3 Day
Event
Create flow by eliminating waste it is now obvious from yourcurrent state map); typically 3-6at Event months out
Rep
ea
Create Include accountability andti f f l ti
Th l f i !
Implementation Plan timeframes for completion
Implement! The goal of mapping!
Value Stream Mapping Activity
3-day activity; three deliverables Day 1 – Document and analyze the current statey y
Go to the Gemba! Day 2 – Design the future state (3-6 months out) Day 3 – Create the implementation plan 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.
K f t i t i b i fi t i t d
© 2010 Karen Martin & Associates
Key success factor - interim briefings to communicate and achieve consensus.
34
Interim Briefings
Day 1 – “Here’s what we’ve learned.” Establishes a mental framework for embracing
improvements; “sells” the need for improvement.Day 2 – “Here’s what we plan to do.”
Does anyone object? If so, why?y j y Challenge policies and paradigms
Day 3 – “Here’s how we’re going to execute ”Day 3 Here s how we re going to execute. Priorities, approach, timeframes, accountability Obtain full commitment right then and there
© 2010 Karen Martin & Associates 35
Obtain full commitment right then and there.
Value Stream Mapping
Planning Your Activity:A ll d l d h t id iA well-developed charter aids in
communication, consensus building and planning
© 2010 Karen Martin & Associates 36
3 days typically; sequential is bestEvent Date(s)Engineering design, ED patient f low , Credit processing, etc.
Executive SponsorValue Stream
Value Stream Mapping CharterEvent Scope Leadership / Coordination Schedule
VP or C-level
6 hrs minimum; 7 or 8 is best
LocationFacilitatorCustomer Demand
Trigger
How many times is this done per wk, mo, or yr.?What need does the value stream address?
Team Lead Not always needed
Skilled person leading the activity
Meals Provided?
If needed - often Director or Manager level
Specific Conditions
What circumstances you're including and excluding?
Value Stream Champion
Last Step Task on last process blockFirst Step Task on first process block
Start/End Times
Always a nice touch; keeps the team from wandering.
Need ample wall space
Interim Briefing(s)
Aid in consensus building and organizational learning.
CoordinatorThe person arranging logistics (reserving the room, ordering food, sending meeting notices, etc.)
Last Step p
Event Drivers Mapping Team
List required attendees; others are optional
Briefing Attendees
Boundaries & Limitations
FS Implementation Timeframe
Wh d i thi ?
What is the team NOT authorized to change?
Typically 90-120 days
g
1 Contact Information2 13 24 35 4
5
NameWhy are you doing this? FunctionLeadership-heavy
Goals & Measureable Objectives1 62 73 84 95 10
Aim for objectives w/ measurable targets (from X to X).j
Planned Deliverables On Call Support1 Contact Information2 13 24 35 4
Planned Deliverables On-Call SupportName
Implementation Plan
Current state VSM FunctionFuture state VSM SMEs that may not be needed full time
37
1234 Date: Date:
FacilitatorValue Stream Champion
Signature: Signature:
Executive Sponsor
Signature:Date:
Potential Obstacles ApprovalsTo the team's success with the mapping activity.
Value Stream Mapping Facilitator Range of Necessary Traits
Skills / Knowledge Lean philosophy
Personality / Energy Naturally curiousea p osop y
Improvement tools Project & time management Mediation; consensus
b ildi
atu a y cu ous Challenging, yet supportive Positive, upbeat, energetic Pushy without irritating
building People effectiveness – from
front line workers to execs Authority / Respect
Thinks fast on one’s feet Objectivity / Fairness
No attachment to the work b i i d Authority / Respect
Recognized change agent / influence leader
Trustworthy
being improved
y Comfortable removing
obstacles & reaching out to senior leadership
© 2010 Karen Martin & Associates 38
Value Stream Mapping ProcessD fiDefine
Product Family
F d ti (th b i ) f th
Products (good or services) withcommon process steps
Document Current State
Foundation (the basis) for the future state; 70-80% accurate isacceptable (directionally correct)
Design Future State 3 Day
Event
Create flow by eliminating waste it is now obvious from yourcurrent state map); typically 3-6at Event months out
Rep
ea
Create Include accountability andti f f l ti
Th l f i !
Implementation Plan timeframes for completion
Implement! The goal of mapping!
The timeline is the most important of the three defining characteristics of a
VSM:1) information flow
2) product flow3) timeline
If your map doesn’t include a timeline, it is not a VSM. If your map has swim
© 2010 Karen Martin & Associates
y planes, it’s not a VSM.
40
Typical VSM Components -Manufacturing
Order Initiation Current State Map Demand = XXXX
May 8, 2008 g
SUPPLIER CUSTOMERProduction
Controln Fl
ow
Robert Parker
SUPPLIER CUSTOMERControl
form
atio
n
1
Process 1 Process 2 Process 3 Process 4
Inf
ow Process 1 Process 2 Process 3 Process 4
rodu
ct F
lo
2I I I
Pr
Hours Hours Hours
line
3LT
PT
Hours
Minutes Minutes Minutes Minutes
Tim
e3 PT
Typical VSM Components -Office / Service
ABC Value Stream Current State Map Demand = XXXX/yr
Date
CUSTOMER
n Fl
ow
Key Contact
form
atio
n
1
I.T. I.T. I.T.
Process 3 Process 4
Inf
ow Process 1 Process 2 Process 3 Process 4
rodu
ct F
lo
2Process 1 Process 2
Pr
Minutes Minutes Minutes Minutes
Hours Hours Hours
elin
e
3LT
PTMinutes Minutes Minutes Minutes
Tim
e3 PT
Concurrent Work / Parallel Flows
Process Process
LT = 8 hrs
Process Process Process
LT = 4 hrs
Bring longest lead time to the timeline, unless it’s a “dead end step.”
© 2010 Karen Martin & Associates 43
Common Differences - Manufacturing vs. Office VSMsManufacturing Office
Customer icon Upper right CenterSupplier icon Upper left None“The thing” we’re Raw material sub- Paper verbal andThe thing we re following
Raw material, subassemblies, finished goods
Paper, verbal, and electronic Information
Information Flow More structured / formalized I.T. systems
Multiple I.T. systems and work-aroundsy
Schedule notification Multiple points across VSM Work not scheduled
Material flow (via Y S ti(hollow arrow) Yes Sometimes
WIP icon Inventory triangle In-bin (if preferred)
Q lit M t i Fi t P Yi ld (FPY) Percent Complete &Quality Metric First Pass Yield (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
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 hightrue 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 i ti h t h ld h th th h tcommunicating what should happen rather than what
does happen.
© 2010 Karen Martin & Associates 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)process blocks (my preference)Only convert to electronic medium if absolutely
necessary (e-distribution, training, etc.)necessary (e distribution, training, etc.) iGrafx FlowCharter (my preference) Systems2Win – Excel-basedy Minitab e-VSM
© 2010 Karen Martin & Associates
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 per time ( p
period) Takt time (if relevant) Date Facilitator’s name (and/or team)
© 2010 Karen Martin & Associates
( )
47
Takt Time: The Key to Continuous Flow
Available work timeT kt ti “T h d ”Takt time =
Customer demand“Touch down”
480 minutes/dayTakt time = = 10.6 mins
45 new accounts45 new accounts
OR…Time Available divided by what Kustomer Takes
© 2010 Karen Martin & Associates 48
Step 2
Identify all blocks in the process (target 5-15 blocks) Customer icon is placed in upper right or middle 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 doesn’t exist
Supplier (if relevant) is placed in upper left 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 teamanother function/work 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.
© 2010 Karen Martin & Associates
Consider walking the process
49
Post-it Conventions
Process (Verb/Noun)( )
Function
# Staff (if relevant)
Barriers to flowBarriers 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 h d li th t ( i Note any scheduling that occurs (rare in current state)Wh t ll h t d h t?
© 2010 Karen Martin & Associates
Who tells whom to do what?
51
Current State Value Stream MapPurchasing — Non-repetitive purchases less than $5,000
Originator
Inititate Req.
PT = 10 mins.C&A = 10%
31
Hard CopySupplies
1
Form File
File Maker
ERP
Quicken
Vendor Website
Excel
Hard Copy
Data Entry
Finance
Review Budget
PT 5 i
6
Corp Purchasing Manager
Approve in ERP
PT 5 i
1Supervisor
Review Req.
PT 5 i
2
Sys Engineer
Review Requisition
1IS Manager
Review Requisition
PT 5 i
1Financial Mgr
Review Requisition
PT 10 i
1
Admin Asst
Enter Requisition
PT 15 i
1
20 ReqsExternal Supplier
PT 20 i
Corp Purchasing
Submit PO to Supplier
6
10 Reqs 63 Reqs2 3 4 5 6 7 8 9 10
PT = 5 mins.C&A = 60%
PT = 5 mins.C&A = 90%
0.25 days
5 mins.
0.5 days
5 mins.
5 days
5 mins.
1 days
5 mins.
1 days
10 mins.
0.5 days
15 mins.
3 days
5 mins.
7 days
15 mins.
10 days LT = 28.4 days
PT = 65 mins.
AR = 0.477%
PT = 5 mins.C&A = 95%
PT = 5 mins.C&A = 90%
PT = 5 mins.C&A = 100%
PT = 10 mins.C&A = 95%
PT = 15 mins.C&A = 98%
4 hrs. 40 hrs. 8 hrs. 8 hrs. 24 hrs. 56 hrs.2 hrs. 4 hrs. PT = 20 mins.PT = 15 mins.C&A = 98%
RFPY = 4.2%
PT = Process Time LT = Lead Time
80 hrs.
Customer Demand:615 requisitions per y ear
C&A = % Complete & Accurate AR = Activ ity Ratio (PT/LT x 100) RFPY = Rolled First Pass Y ield
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” arrow for push systemsp p y Hollow arrow for material flow
Connect and I T systems
© 2010 Karen Martin & Associates
Connect and I.T. systems
53
Post-it Conventions
Process (Verb/Noun)
Process Block #
( )
Function
# Staff (if relevant)
Barriers to flowBarriers to flow
PT (process time)(p )
LT (Lead time)% Complete & Accurate
Depicting e-Information Flow
I.T.Application
Arrow pointing to I T li ti
I.T.Application
Two-headed arrow: St ff b th i d
ProcessBlock
I.T. application: Staff enters data
ProcessBlock
Staff both views and enters data
I.T.Application
Arrow pointing from
#1 I.T.Application
#2 I.T.Application
ProcessBlock
Arrow pointing fromI.T. application: Staff views data Lightning bolt arrow:
Application #1 auto-populates application #2
55
application #2
Current State Value Stream MapPurchasing — Non-repetitive purchases less than $5,000
Originator
Inititate Req.
PT = 10 mins.C&A = 10%
31
Hard CopySupplies
1
Form File
File Maker
ERP
Quicken
Vendor Website
Excel
Hard Copy
Material flow
Data Entry
ERP auto-populates
P.O.
Finance
Review Budget
PT 5 i
6
Corp Purchasing Manager
Approve in ERP
PT 5 i
1Supervisor
Review Req.
PT 5 i
2
Sys Engineer
Review Requisition
1IS Manager
Review Requisition
PT 5 i
1Financial Mgr
Review Requisition
PT 10 i
1
Admin Asst
Enter Requisition
PT 15 i
1
20 ReqsExternal Supplier
PT 20 i
Corp Purchasing
Submit PO to Supplier
6
10 Reqs 63 Reqs2 3 4 5 6 7 8 9 10
PT = 5 mins.C&A = 60%
PT = 5 mins.C&A = 90%
0.25 days
5 mins.
0.5 days
5 mins.
5 days
5 mins.
1 days
5 mins.
1 days
10 mins.
0.5 days
15 mins.
3 days
5 mins.
7 days
15 mins.
10 days LT = 28.4 days
PT = 65 mins.
AR = 0.477%
PT = 5 mins.C&A = 95%
PT = 5 mins.C&A = 90%
PT = 5 mins.C&A = 100%
PT = 10 mins.C&A = 95%
PT = 15 mins.C&A = 98%
4 hrs. 40 hrs. 8 hrs. 8 hrs. 24 hrs. 56 hrs.2 hrs. 4 hrs. PT = 20 mins.PT = 15 mins.C&A = 98%
RFPY = 4.2%
PT = Process Time LT = Lead Time
80 hrs.
Push A Customer Demand:
615 requisitions per y ear C&A = % Complete & Accurate AR = Activ ity Ratio (PT/LT x 100) RFPY = Rolled First Pass Y ield
Arrow
Step 5
Add key metrics for all process blocks Process Time (PT) Lead Time (LT)
P t C l t & A t (%C&A) Percent Complete & Accurate (%C&A)Add additional obstacles to flow if any are
id tifi d ( b t h h didentified (e.g. batches, shared resources system availability/speed, etc.)Add th WIP ( k i ) f llAdd the WIP (work-in-process) for all
process blocks.
© 2010 Karen Martin & Associates 57
Post-it Conventions
Process (Verb/Noun)
Process Block #
( )
Function
# Staff (if relevant)
Barriers to flowBarriers to flow
PT (process time)(p )
LT (Lead time)% Complete & Accurate
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 that’s completeAfter the process block – Work that’s complete,
but hasn’t been passed onWIP WIP
WIP
WIP WIP
Step 1 Step 2 Step 3WIP
© 2010 Karen Martin & Associates 59
Current State Value Stream MapPurchasing — Non-repetitive purchases less than $5,000
Originator
Inititate Req.
PT = 10 mins.C&A = 10%
31
Hard CopySupplies
1
Form File
File Maker
ERP
Quicken
Vendor Website
Excel
Hard Copy
Data Entry
Finance
Review Budget
PT 5 i
6
Corp Purchasing Manager
Approve in ERP
PT 5 i
1Supervisor
Review Req.
PT 5 i
2
Sys Engineer
Review Requisition
1IS Manager
Review Requisition
PT 5 i
1Financial Mgr
Review Requisition
PT 10 i
1
Admin Asst
Enter Requisition
PT 15 i
1
20 ReqsExternal Supplier
PT 20 i
Corp Purchasing
Submit PO to Supplier
6
10 Reqs 63 Reqs2 3 4 5 6 7 8 9 10
PT = 5 mins.C&A = 60%
PT = 5 mins.C&A = 90%
0.25 days
5 mins.
0.5 days
5 mins.
5 days
5 mins.
1 days
5 mins.
1 days
10 mins.
0.5 days
15 mins.
3 days
5 mins.
7 days
15 mins.
10 days LT = 28.4 days
PT = 65 mins.
AR = 0.477%
PT = 5 mins.C&A = 95%
PT = 5 mins.C&A = 90%
PT = 5 mins.C&A = 100%
PT = 10 mins.C&A = 95%
PT = 15 mins.C&A = 98%
4 hrs. 40 hrs. 8 hrs. 8 hrs. 24 hrs. 56 hrs.2 hrs. 4 hrs. PT = 20 mins.PT = 15 mins.C&A = 98%
RFPY = 4.2%
PT = Process Time LT = Lead Time
80 hrs.
Customer Demand:615 requisitions per y ear
C&A = % Complete & Accurate AR = Activ ity Ratio (PT/LT x 100) RFPY = Rolled First Pass Y ield
WIP
Step 6
Create timeline & calculate summary metrics Timeline PT Sum Timeline PT Sum Timeline LT Sum
A ti it R ti Activity Ratio Rolled First Pass Yield (RFPY)
© 2010 Karen Martin & Associates 61
How to Treat Lead Time in Office/Service Environments
Lead Time
Process 2Process 1
Process Time
LT LT
PT PT
Office/Service Lead Time ―• From the time work is made available until it’s 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.
© 2010 Karen Martin & Associates 62
• Represents total throughput time, including process time; not merely wait time.
Value Stream MappingProjected Resultsj
Metric Current State ProjectedFuture State
Projected % Improvement
Ti li L dTimeline Lead TimeTimeline Process Time
Activity Ratio
R ll d Fi tRolled First Pass YieldTotal Process
( )Time (all blocks)
Labor Effort
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Others, as relevant
Typical Current State Findings
Necessary NVA
Unnecessary NVA NVANVA
Value AddAvailable
to work onAvailable to
next step
Islands of activity (process times) within long lead times.
© 2010 Karen Martin & Associates 64
Step 7
Identify all value-adding (VA) and necessary l ddi (N) tnon-value-adding (N) steps
Add “VA” or “N” smaller post-it to relevant process blocksblocks
All unnecessary non-value-adding blocks remain unlabelled
Enter Order
Check Credit
Approve Order
Customer Rep Sales RepFinance
VA N Unnecessary
© 2010 Karen Martin & Associates 65
Value-adding Non-Value-AddingNecessary Non-Value-Adding
Customer-Defined Value
Value-Adding (VA) - any operation or ti it t l t lactivity your external customers value
and are (or would be) willing to pay for.N V l Addi (NVA) tiNon-Value-Adding (NVA) - any operation
or activity that consumes time and/or resources but does not add value to theresources but does not add value to the product (good or service) the customer receivesreceives. Necessary – support processes, regulatory
requirements, etc.
© 2010 Karen Martin & Associates
Unnecessary – everything else - WASTE66
Work Effort as Defined by the External CustomerExternal Customer
U NUnnecessary Non-value addingNecessary non-value-addingaddingValue-adding
Value Stream Mapping ProcessD fiDefine
Product Family
F d ti (th b i ) f th
Products (good or services) withcommon process steps
Document Current State
Foundation (the basis) for the future state; 70-80% accurate isacceptable (directionally correct)
Design Future State 3 Day
Event
Create flow by eliminating waste it is now obvious from yourcurrent state map); typically 3-6at Event months out
Rep
ea
Create Include accountability andti f f l ti
Th l f i !
Implementation Plan timeframes for completion
Implement! The goal of mapping!
Designing the Future State Value Stream
Target All Waste!
© 2010 Karen Martin & Associates 69
Eight Wastes (Muda)
OverproductionInventory
Motion (people)Transportation y
WaitingOver Processing
p(material/data)UnderutilizedOver-Processing
Errors
Underutilized people
© 2010 Karen Martin & Associates 70
Future State Design
Goal: Removing all obstacles to flow (“the g (thing” should never stop) Batches Rework WIP / Bottlenecks WIP / Bottlenecks Handoffs Setup / changeover Setup / changeover Physical layout Motion & transportation
© 2010 Karen Martin & Associates
Motion & transportation
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Eight Questions for Future State VSM
1. What are the customer requirements? What’s the takt time?time?
2. With goods, will we produce to order or to finished goods inventory? (With services, you’re almost always g y ( y yproducing to order.)
3. Where can continuous flow be put in place?4 Wh h ld ll t b i l t d?4. Where should pull systems be implemented?5. What is the single point of scheduling?6 How do we level the load and the mix?6. How do we level the load and the mix?7. What should the management time frame be?8. What process improvements are necessary to achieve
© 2010 Karen Martin & Associates
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
Balance work to meet takt time requirementsincoming customer
requests) Standardize the work
takt time requirements Co-locate and cross-
train work teams Eliminate steps / handoffs Eliminate waste Combine steps
Implement pull Implement visual
management Combine steps Create parallel paths Alter task sequencing and/or
management Organize the workplace
so problems are visible R d htiming
Eliminate or reduce batches Level demand
Reduce changeover Eliminate motion &
transportation
© 2010 Karen Martin & Associates 73
Level demand p
Building a Lean Enterprise
Process Stabilization
ToolsTools
Building a Lean Enterprise
Flow Enabling Tools
Future State Icons
SupermarketWithdrawal
ProductionKanban
Withd lKanbanArriving
Combined Steps
WithdrawalKanban
Signal
Arrivingin Batches
Eliminated StepKanban
KanbanPost
First-InFirst-OutFIFO
Max 8 “things” Buffer Stock
OXOXLeveling,
Mi d/Kanban
Path
(max WIP defined)
OXOX Mix and/orVolume
Path
Kaizen Burst
Value Stream MappingProjected Resultsj
Metric Current State ProjectedFuture State
Projected % Improvement
Lead Time
Process Time
% Activity
Rolled First Pass YieldPass Yield
Labor Effort
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Value Stream Mapping ProcessD fiDefine
Product Family
F d ti (th b i ) f th
Products (good or services) withcommon process steps
Document Current State
Foundation (the basis) for the future state; 70-80% accurate isacceptable (directionally correct)
Design Future State 3 Day
Event
Create flow by eliminating waste it is now obvious from yourcurrent state map); typically 3-6at Event months out
Rep
ea
Create Include accountability andti f f l ti
Th l f i !
Implementation Plan timeframes for completion
Implement! The goal of mapping!
Value Stream
11/21/2007Allen WardSally McKinseyDave Parks 12/13/2007
Future State Implementation PlanExecutive Sponsor
Value Stream ChampionValue Stream Mapping Facilitator
Implementation Plan Review Dates11/1/2007
Outpatient Imaging
1 2 3 4 5 6 7 8 9 10 11 12
2 Improve quality of referral KE Sean O'Ryan
Block# Goal / Objective Improvement Activity
Implement standard work for referral process
Type Owner Implementation Schedule (weeks) Date Complete
Date CreatedDave Parks 12/13/200710/18/2007 1/10/2008
Value Stream Mapping Facilitator
3, 4 Reduce lead time beween schedulingand preregistration steps PROJ Dianne
Prichard
5, 6 Eliminate the need for two patient check-ins KE Michael
O'Shea
6 Eliminate bottleneck in waiting area KE Dianne P i h d
Cross-train and colocate work teams
Collect copays in Imaging
Balance work / level demandg Prichard
9 Eliminate lead time associated with transcription step PROJ Sam Parks
10 Eliminate batched reading KE Sam Parks
Implement voice recognition technology
Reduce setup required
7 Reduce inventory costs, regulatory risk and storage needs KE Michael
O'Shea
12 Reduce delay in report delivery PROJ Martha Allen
12 Reduce delay in report delivery KE Martha Allen
Implement additional fax ports
5S CT supplies area; implement kanban
Increase percentage of physicians receiving electronic delivery (rather than y p y g y (hard copy)
Value Stream Mapping Facilitator
Approvals
Executive Sponsor Value Stream Champion
Signature:
Date: Date: Date:
Signature: Signature:
PACE Prioritization Matrix5 1021
Policy
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n Easy
136 15
I.T.
Process
men
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723
214
1718
20
25
Im
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9
1612
26
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192427
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11
3
80High LowAnticipated Benefit
About Karen Martin
Early career as a scientist; migrated to quality & operations design in the mid 80’s& operations design in the mid-80 s.
Launched Karen Martin & Associates in 1993, focusing on operations design and Total Quality ManagementManagement.
Began applying “white collar” lean in 2001. Co-author of The Kaizen Event Planner:
A hi i R id I t i OffiAchieving Rapid Improvement in Office, Service, and Technical Environments; co-developer of Metrics-Based Process Mapping: An Excel Based Solution Karen Martin, PrincipalAn Excel-Based Solution.
University of California, San Diego Lean Enterprise program instructor.
F i f ti k ti
Karen Martin, PrincipalKaren Martin & Associates
© 2010 Karen Martin & Associates
For more information: www.ksmartin.com
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