Hi, I’m Nate Barber. Welcome to the 5th video in our 10-part series celebrating Opgrade’s 10th anniversary. Thanks for watching, and thanks for celebrating with us!
Last week we talked about value, and that value-added, or VA activities are defined as only those activities in our organizations that:
Our customers would pay us more if we did them more, and
Change the fit, form, or function of something, anything, including information, and
Is done correctly the first time, meaning it isn’t rework.
If you’re doing something in your organization that doesn’t meet all three of these criteria, then that activity isn’t adding value. It’s Non-Value Added, or NVA. Now the question is, do you have to do that thing, is it absolutely required? If it is required, that’s what we might call Business Required NVA, or BRNVA. To hear me bloviate about VA, NVA, and BRNVA in more detail, please check out our previous video.
Now, how do you determine if the activities in your business are Value Added? Well, very simply, you need to go through them, one by one, and ask yourself the 3 value added questions. You clearly already have a process map of all your company’s activities to help you do this, right? Right. And this is where most organizations fall short. We get so busy in all the doing of the work that we can rarely describe the process of how the work gets done. Often the left hand doesn’t know what the right hand is doing. And that, my friends, is why I think W. Edwards Deming said, “If you can’t describe what you are doing as a process, you don’t know what you are doing.”
Deming's words are convicting, even harsh. Nevertheless, I have been in several well-known organizations that, by Deming’s definition, don’t know what they’re doing. It’s just a bunch of well-intentioned people working hard and trying not to screw it up that day. There are lots of people working hard. Not everyone works smart.
So how do we get out of that trap? Well, it takes teamwork and an investment of time. Continuous Improvement is spending 10 minutes today to make tomorrow 1 minute better, forever. Invest the extra time to bring a team together for a week to map a value stream, and the ROI can be exponential.
Process mapping makes your process visible. You can step back and see the forest for the trees. It makes it much more possible to understand which of your activities are VA, which are BRNVA, and which are simply NVA, completely Non-Value Added, complete waste. Remember, Lean is about stopping the silly stuff, and from my perspective, dealing with waste every day is rather silly.
If you’re going to bring a team together for a week to map out a process, where do you start? Which value stream should you map? Well, I suppose it might first help to know what a value steam is, wouldn’t it? A value stream is simply all the steps necessary for your customer to order something, all the steps for you to process the order, make the order (or provide the service), and for you to deliver the value you created to that customer. Some products or services have similar steps, some have very different steps or processes.
Those products that have similar processes might be considered to all be part of the same value stream, and other products would be in other value streams. You can start to figure out which is which using a product vs process matrix, where you can see the similarities and differences in the processes required to deliver your entire portfolio. If you don’t yet have a good idea of all your processes, which again is many organizations, it can be hard to put together a product vs process matrix. In this situation, a simple and often effective starting point is to first map how value flows in your highest volume product, or product family. That way your first value stream map can help you identify how the biggest chunk of your value is created.
As we discussed earlier, value is always defined by the customer, and so value streams always start and end with the customer. They place the order, and they receive the value. And that, by the way, is a great scope for a mapping event. From when the customer places the order, to when they receive the value. Those are good bookends for your process map.
From there, I generally coach teams to create a swim lane process map, where each step is categorized into different lanes based on the person, or department, or machine, or whatever that performs the activity. Swim lane process maps typically go into much more depth than what you might see if you google “Value Stream Map”, and for me, this is by design. We humans are generally terrible at summarizing. Even Mark Twain once wrote, “I didn’t have time to write you a short letter, so I wrote you a long one.” We humans like to get into the weeds of what we do, because it’s what we do every day. Once we lay it all out on a detailed swim lane map, though, it is much easier to accurately summarize the steps. We can literally take a step back and affinitize, that is, see the groupings of the process steps, and give those groups of steps summary names.
It is then those summary names that we put onto a process map that looks much more like what you see in Rother and Shook’s seminal work, Learning to See, which is the definitive text for Value Stream Mapping. The traditional Value Stream Map, or VSM format has three parts: the high-level, summarized process flow across the middle, the information flow across the top, and the lead time ladder across the bottom. This is the preferrable format for a VSM because it helps the team see the process as a series of modular components that can be rearranged to help value better flow.
There is a reason Lean uses water metaphors, like streams and flow, to describe optimal productivity in a process. Just like water in a river, we want value to flow without restrictions, unless we have a particular purpose for something like a dam. However, too often in business, we put all sorts of little dams into the value stream. These dams are usually some sort of WIP, where we accumulate product or information unnecessarily, usually because we think we’re adding some sort of control to the process. Instead, we’re just making the flow slower and costing the organization time and money to manage these artificial structures.
And that’s what Value Stream Mapping is about. Getting a lay of the land, seeing where the river flows smoothly (flow in lean), seeing where the rocks are (waste), and seeing where we’ve constructed dams (batch and queue) like busy little beavers. Speaking of beavers, I saw a documentary on beavers last night. It was the best dam show I’ve seen all year.
Is that the first terrible dad joke I’ve put into these videos? Golly. Better late than never!
Next week’s video is on flow, and what it takes to turn just about any process into an assembly line.
Until then, thanks for watching, and thanks for celebrating Opgrade’s 10th anniversary with us.