Manufacts
Spring 2001



Value-Stream Mapping Can Reduce Costs, Enhance Growth

Mapping processes using flow charts or diagrams is an effective first step to improving a procedure. Charting the process often reveals that the participants have different notions of the value they deliver to customers and consequently different ways of performing the steps. These differences provide an opportunity for improvement through benchmarking. Since physical processes are readily visible to the participants, they may already be "optimized." It’s the information flows that present the challenge and opportunity because workers often ignore them. This is where value-stream mapping can help.

Use for Current Processes
Value-stream mapping may reveal that workers are performing individual steps efficiently and correctly, but the total process is taking too long. Mapping the waiting time between steps may hold the key to dramatic improvements in total process time. In addition, value-stream mapping may reveal areas where nonconformance loops (rework, reject, warranty) may be minimized or eliminated.

Use for Processes Not Yet in Place
Value-stream mapping is also a valuable exercise for new processes that haven’t been implemented. Advance planning is the key to getting the process correct from the start so that subsequent rework won’t be necessary.

Use for Growth
Although value-stream mapping removes non-value-added steps and thus cost, an often overlooked benefit is revenue. If, for example, you can shorten a throughput cycle using this technique, you might be able to serve more time-sensitive customers (usually with higher margins) and increase revenues.

Keep It Simple
Don’t get hung up on the mechanics of charting. There are commercially available value-stream mapping software packages you can buy. But even a simple "cocktail napkin" approach can start you toward better solutions today.



Perisho Tombor Ramirez Filler & Brown
901 Campisi Way, Suite 250
Campbell, CA 95008
408-558-0500
info@ptlr.com

The articles in this newsletter are general in nature and are not a substitute for accounting, legal, or other professional services. We assume no liability for the reader's reliance on this information. Before implementing any of the ideas contained in this publication, consult a professional advisor to determine whether they apply to your unique circumstances.
© 2001