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Value Stream Mapping: A Key Tool For Business Optimisation

Updated: Sep 27, 2023

In today’s competitive business landscape, organisations strive for efficiency and

Continuous Improvement to stay ahead of the curve. One invaluable tool that has emerged

to meet this challenge is value stream mapping (VSM).


VSM is a powerful technique that helps businesses streamline their processes to enhance

productivity, reduce waste, and improve customer satisfaction. Read on to learn more

about value stream mapping, including what it is, how it works, and using it for continuous

business enhancement.

value stream mapping text

Defining value stream mapping

Value Stream Mapping is a visual representation of the entire process that a product or

service undergoes, from its inception to customer delivery. As a key component of Lean

techniques, it aims to eliminate waste and achieve process optimisation.

The primary objective of VSM is to identify value-added and non-value-added activities in a

business’s processes.

● Value-added activities directly contribute to meeting customer requirements

● Non-value-added activities are wasteful and should be minimised or eliminated


By understanding these distinctions, businesses can work towards process optimisation,

reduce costs, and improve customer satisfaction.

Ultimately, VSM provides a holistic view of how materials and information flow through

various stages to identify bottlenecks, redundancies, and areas for improvement.

Steps to create a value stream map

1. Select the process: Choose the specific process or workflow that you want to map.

It could be anything from product manufacturing to order processing.

2. Identify boundaries: Clearly define the scope, determining where the process

starts (i.e. with a customer order) and ends (i.e. with a product or service delivery)

to ensure that your value stream map focuses exclusively on the customer journey.

3. Gather a cross-functional team: Assemble a team from different departments

involved in the process to ensure a holistic view and capture diverse perspectives.

4. Map the current state: Start by creating a visual representation of the existing

processes, including all the steps, inputs, outputs, and information flows. Use

standardised symbols and labels to make the map easily understandable.

5. Collect data: Gather data related to cycle times, lead times, and inventory levels at

various stages to identify inefficiencies.

6. Identify value-add activities: Analyse the map to distinguish between activities

that add value to the process and those that do not. Non-value-added activities

should be targeted for improvement.

7. Create the future state map: Design a future state map based on your insights

from the current map to represent the ideal, optimised process. This map should

include improvements and changes needed to eliminate waste and enhance

efficiency.

8. Develop an implementation plan: Lay out a plan to make changes identified in the

future state map. Assign responsibilities, set timelines, and establish key

performance indicators (KPIs) to track progress.

9. Review and continuously improve: The hard work doesn’t stop there – regularly

review the value stream map and make necessary adjustments as the process

evolves.

Utilising VSM for Continuous Improvement

Value stream mapping is not a one-time exercise – it’s a Continuous Improvement tool. By

applying VSM principles, organisations can unlock a host of benefits, chief among them…


● Waste reduction: VSM identifies and eliminates waste, whether it’s in the form of

excess inventory, overproduction, unnecessary waiting times, or redundant

processes.

● Cost savings: Streamlining processes often reduces operational costs, including

lower labour and material expenses.

● Improved quality: Focusing on value-added activities enhances product or service

quality, reducing defects and the need for rework.

● Faster lead times: Shorter lead times can be a competitive advantage in delivering

products and services to customers.

● Enhanced customer satisfaction: Efficient processes result in quicker deliveries

and better service, ultimately leading to increased customer satisfaction and loyalty.

Example of value stream mapping


man working on a wood machine

Consider a manufacturing company that produces bespoke furniture – they decide to

create a value stream map for their order fulfilment process.

This might include:

1. Customer places an order

Problem: Incomplete or inaccurate order information can lead to production errors.

Solution: Implement a user-friendly online order form with validation checks and clear

instructions. Provide customer support channels for order assistance.

2. Sales team reviews the order and contacts the customer for clarification

Problem: Sales team delays in reaching out, causing customer frustration.

Solution: Establish a clear timeline for order review and customer contact. Use automated email notifications to keep the customer informed about the process.

3. Production planning team schedules the order and allocates resources

Problem: Resource allocation errors lead to delays in production.

Solution: Implement a robust resource management system that optimises resource

allocation based on order priorities and capacity. Regularly review and adjust schedules as needed.

4. Manufacturing team builds the furniture

Problem: Equipment breakdowns or material shortages halt production.

Solution: Perform preventative maintenance on machinery, maintain a buffer stock of

essential materials, and establish relationships with multiple suppliers for critical

components.

5. Quality control team inspects the finished product

Problem: Inconsistent quality standards result in subpar products reaching customers.

Solution: Define clear quality control standards and provide training to the inspection

team. Implement automated inspection tools where applicable to maintain consistency.

6. Shipping team packs and ships the product to the customer

Problem: Shipping delays or damaged products during transit.

Solution: Use reliable shipping carriers, track shipments, and implement proper packaging techniques to prevent damage. Communicate shipping information to customers promptly.

7. Customer receives and evaluates the furniture

Problem: Customer dissatisfaction due to product defects or discrepancies.

Solution: Offer a hassle-free return and replacement policy. Actively seek feedback from

customers and use it to improve product quality and customer satisfaction.


By creating a value stream map, the bespoke furniture company can identify bottlenecks,

delays, and areas where value is added or lost. They can then optimise the process,

potentially reducing lead times, improving communication, and enhancing product quality.

Learn more about value stream mapping

Value stream mapping is a powerful tool that empowers organisations to reduce waste and

continuously enhance their operations. By adopting VSM as a part of their Lean toolbox,

businesses can stay competitive in today’s fast-paced business environment, ultimately

delivering greater value to their customers.

If you would like more information about value stream mapping or to sign up for one of our

lean courses, please contact us:

● Phone: 0161 533 1617

● Email: hello@manufacturersnetwork.com

● Visit our website for more information

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