Value Stream Mapping

Value Stream Mapping A Lean Six Sigma Consulting and Engineering Firm www.opexdirect.com

∙ VALUE STREAM MAPPING ∙

L

WHAT TO EXPECT…

Define Lean Six Sigma

What is Value-Add and Non Value-Add Activity

Value-Add vs Non Value-Add (NVA = Waste)

Eliminating Non Value-Add Activity

Time Reduction. Why is it important?

Value Stream Mapping, a tool of Lean Six Sigma.


EVOLUTION OF CONTINUOUS IMPROVEMENT


LEAN SIX SIGMA 101

LEAN SIX SIGMA is a disciplined continual improvement method that resulted from the combined effort of lean and six sigma.

1) Lean works to improve any process by identifying and eliminating waste using various techniques designed to be applied directly at any level of business.

2) Six Sigma works to improve any business process by identifying and reducing variability through the deliberate and systematic application of statistical problem solving.

THE COMMON THREAD CONNECTING THESE TWO METHODS IS THE CONTINUOUS AND RELENTLESS PURSUIT FOR PERFECTION.


Value-Adding Activities......transform raw materials and information into products or services

which the customer wants!

Non-Value-Adding Activities......consume resources, but don't directly contribute to the product.

Necessary Non-Value-Adding Activities……activities that do not add value but are required due to current process

design, government regulations, or for other reasons.

VALUE-ADD vs. NON VALUE-ADD










WASTE - A DEEPER LOOK

“Transactional Process Waste”

• Layout (distance)

• Long setup times

• Incapable processes

• Poor operating practices

• Poor communication

• Lack of training

• Lack of adherence

• Irrelevant performance measures

• Ineffective production planning/scheduling

• Lack of workplaceorganization

• Quality/Reliability Issues• Unreliable equipment• More…

“If it doesn’t add value, it’s waste.” Henry Ford 1920

CAUSES OF WASTE


ADDITIONAL COSTS OF POOR PERFORMANCE

Lost Opportunity

Scrap

Rework

Inspection

Rejects

Lost Sales

Long Cycle Times

Expediting Costs

Excess Inventory

Lost Customer Loyalty

More Set-ups

Additional Material Costs

Excessive Material Planning

Warranty

Late Delivery

TRADITIONAL COST OF POOR PERFORMANCE

Additional Inspection

Obsolete Material


SEA OF WASTE

ADDITIONAL COST OF POOR PERFORMANCE

Lost Opportunity

Scrap

Rework

Inspection

Rejects

Lost Sales

Long Cycle Times

Expediting Costs

Excess Inventory

Lost Customer Loyalty

More Set-ups

Additional Material Costs

Excessive Material Planning

Warranty

Late Delivery

TRADITIONAL COST OF POOR PERFORMANCE

Additional Inspection

Obsolete Material




Kaizen Waste Reduction

Traditional Manufacturing Improvement

Typical Company

Value-Adding Activities Non-Value-Adding Activities

TYPICAL BUSINESS IMPROVEMENT

TYPICAL BUSINESSACTIVITY

LEAN SIX SIGMA IM-PROVEMENT

MajorImprovement

1% Improvement

0.5%

10%Minor

Improvement

REDUCING NON VALUE-ADD ACTIVITY


99%

99.5%

90%

(the business focuses on the value add)

Time is the single best indicator of competitiveness!

1 Hour – 2 Hour – 3 Hour ….



Typical Company





MajorImprovement

1%

0.5%

10%Minor

Improvement



99%

99.5%

90%

(focus on reducing the value-add time)



Typical Company





MajorImprovement

1%

0.5%

10%Minor

Improvement



99%

99.5%

90%

(the business focuses on the value add)

LEAN SIX SIGMA STEPS

Value Stream Mapping www.opexdirect.comA Lean Six Sigma Consulting and Engineering Firm

1. Identify the sequence of activities called the “Value Stream"

2. Identify which activities create value (VALUE-ADD)

3. Make the activities Flow

• Eliminating waste and reducing variation (NON VALUE-ADD)

4. Create Pull throughout the Value Stream

5. Perfect the Process

LEAD TIME

WASTE ELIMINATION = TIME REDUCTION


1 MONTH

LEAD TIME



1 MONTH

LEAD TIME



1 MONTH

COMMUNICATION & INFORMATION STEPS

LEAD TIME


PROCESSING (SERVICE/MANUFACTURING) STEPS


1 MONTH

COMMUNICATION & INFORMATION STEPS

VALUE STREAM

LEAD TIME



1 MONTH

VALUE STREAM

LEAD TIME



1 MONTH

The Process is the Focus of Lean Six Sigma WASTE elimination activity!








LEAD TIME

NON VALUE-ADD

VALUE-ADD



1 MONTH

Identify what is --------->

Identify what is --------->

LEAD TIME

VALUE-ADD



1 MONTH

ELIMINATE NON VALUE-ADDED ACTIVITY IN THE VALUE STREAM

LEAD TIME



1 MONTH

VALUE-ADD

LEAD TIME



1 MONTH

LEAD TIME REDUCTION FROM 1 MONTH TO 5 DAYS

LEAD TIME

5 DAYS

LEAD TIME



1 MONTH

NEW VALUE STREAM


VALUE STREAM MAP EXAMPLE



SEARCH FOR IMPROVEMENT OPPORTUNITIES (LEAN SIX SIGMA)

IdentifyFocusArea




FocusProcess

MapFocus Area




FocusProcess

MapFocus Area




LEAN SIX SIGMA EFFORT



Value Stream Mapping

Business

value stream mapping

activity value

causes of waste value

necessary nonvalue

sigma consulting

lean works

tool of lean

engineering firm