What Is Value Stream Mapping? Definition, Working, and Examples

Value stream mapping (VSM) shows the events leading up to product usage to map inputs vs. outputs and reduces waste.

September 20, 2022

Value stream mapping (VSM) is a project workflow visualization tool that pictorially represents the events that lead to the user receiving the product, including product development, the supply chain, design, quality assurance, customer support, etc. — depending on the industry — to map inputs vs. outputs and reduce waste. This article explains how value stream mapping works with examples.

What Is Value Stream Mapping? 

Value stream mapping (VSM) is defined as a project workflow visualization tool that pictorially represents the events leading up to the user receiving the product, including product development, the supply chain, design, quality assurance, customer support, etc. — depending on the industry — to map inputs vs. outputs and reduce waste. 

Pictorial Representation of a Value Stream Map

Pictorial Representation of a Value Stream Map | SourceOpens a new window

Companies worldwide have to deal with the ever-growing challenge of meeting rising consumer expectations and value systems while maintaining an affordable price for their goods and services. That is, prices fit into the demands of the already established or prospective target market. This can be challenging for industries and manufacturing plants that deal with the production of goods and also organizations that specialize in offering various services. 

Because of this, product management methods like the lean methodology have been widely adopted. In particular, value stream mapping has started to be used in different fields, such as product development and DevOps. It is a fundamental idea that has been around for more than 60 years. Managers, team leaders, and employees should understand it at crucial points in the workflow and decision-making process.

What is the meaning of value stream mapping?

It’s important to remember that users, whether external (customers) or internal (employees), care about the value of the product or service they’re getting, not about how hard it was to make or how much value it might bring to other users. Value stream mapping keeps this in mind. It allows project managers to illustrate, analyze, design, and optimize the workflow procedure involved in producing a product from start to finish. 

Value stream mapping is a tool used in the lean product management method. It looks at the steps to make a product and finds the high-value steps and wasteful areas. It is also forward-looking as the technique can be used to design a production model that will consider current performance and future goals. 

A value stream map is a visual representation of a company’s production process — highlighting all of the critical activities and phases that contribute to creating additional value. It may vary from company to company, even for the same end product. It quantifies input such as time and output in terms of volume. 

Value stream maps can easily be likened to a flowchart, using diagrams, pictures and symbols to depict the flow of materials being processed and information down a work process. In a practical setting such as an oil processing plant, a value stream map will depict the arrival of raw materials, washing and preparation, the extraction process, purification, branding, and packaging and may also include delivery to warehouses or direct consumers. Using value stream mapping, a production manager can identify areas of backlog, stagnancy, and waste that reduce the total efficiency of the process.

Value stream mapping is not a very new idea. Toyota first recognized its implementation after the Second World War. It was then called a material and information flow diagram. Later, it integrated into the lean manufacturing ideology, spreading the idea across the United States in the 90s. 

See More: What is Root-Cause Analysis? Working, Templates, and Examples

Elements of a value stream map 

The first step in successfully constructing a value stream map is to recognize and appreciate the components inherent to each value stream map. Four primary elements comprise the foundation of the production process and must be incorporated into value stream mapping. These are:

  • The customer: This is an essential element in the value mapping stream. Note that it is what the consumer regards as the value that matters most in the value system and not operational practices that do not directly influence the outcome. The symbol representing the customer should be attached to a data box that tells the production team how much of the product is needed per day to satisfy demand. This determines an effective operation in which the cycle time is equal to the takt time and is also used to compute the takt time.
  • Supplier: The supplier is also vital to the value stream map. This is used to cover the flow of raw materials used in processing. For multiple suppliers, geographical areas or a general symbol can be used. Understanding the suppliers helps keep track of production costs, capital, and inventory. 
  • Product flow: The product flow forms the body of the mapping process. It visualizes, using symbols, each procedure done on the raw material to get it to the finished form. The different stations like processing, printing and sealing machines, assembly stations, etc., are captured in the product flow. Information in terms of human resources involved in each production step is also summarized for proper evaluation. 
  • Information flow: The documentation of this step in the value stream mapping process is what you see in this element. Often overlooked, the information flow is integral to the smooth running of the value stream. It can be manual in the form of printed reports and cards or in an electronic format using note apps, Trello, etc. The information flow directs restocking of raw materials, processing and interpreting customer demands, work schedules, shifts, emails, etc.

See More: DevOps vs. Agile Methodology: Key Differences and Similarities 

Purpose of value stream mapping 

Since its beginnings as a component of the lean methodology, value stream mapping has shown its utility in making production processes more efficient. This has been the case ever since the method’s debut. Value stream mapping aims to reduce waste and maximize efficiency, which means minimizing effort as much as possible. The benefits it brings about include: 

  • It identifies the source of waste and minimizes it. The term “waste” refers to any stage in the value stream that does not contribute to the overall value proposition for the final consumer. VSM helps you identify these steps and reduce them to the barest minimum. 
  • It promotes open lines of communication and teamwork amongst different groups. From sourcing to production and operations, down to logistics, VSM increases interdepartmental cooperation and collaboration. It does this while ensuring that every team member has well-defined yet flexible roles. 
  • It boosts production efficiency in terms of input and output. It does this by determination of cycle time, takt time, eliminating delays and lags, etc. Resources that are not needed for the end product are also eliminated.
  • Value stream mapping provides a platform for expansion and growth. It also helps form the basis of an implementation plan for new product ideas. 

Understanding the use of value stream mapping in DevOps

In the past, value stream mapping was only employed in factories and other manufacturing facilities. But now, the principles have been used to draw value stream maps for software development and operations. In a DevOps lifecycle, the goal is to ensure continuous delivery of the product, and it starts from software development and life cycle to monitoring, debugging, improvements, and so on. 

One can tailor value stream mapping to the specific actions carried out by each team member or sequentially. The maps thus bear a pictorial representation of all the steps involved in software development. It should start from the initial coding, debugging, quality assurance, and deployment and end in the maintenance cycle. VSM, therefore, increases the simplicity and effectiveness of the DevOps team. 

See More: Top 10 DevOps Automation Tools in 2021

How Does Value Stream Mapping Work? 

Value stream mapping is a relatively easy technique to implement. Only occasionally does a specialist need to draw a functional map for your organization’s workflow. These ten stages will demonstrate how one may implement value stream mapping in your business. 

1. Identify the business problem 

The first step in any value stream mapping process is identifying the problem. Identifying the problem consists of knowing the product and identifying the customer’s pain point or value for that product. This will guide the aim of the mapping process. 

The product could be a good, software, or service. The customer’s pain point concerning that product could be increased delivery time, demand for a price reduction, the increased demand not being met with supply, etc. Either way, this should be the background knowledge for every team member as it will influence how they approach the value stream map and hence influence whether the outcome will be effective. 

2. Set boundaries for the value stream map 

Setting boundaries is a very crucial step of VSM. Without boundaries, there will be excess and unnecessary energy expenditure even in mapping. The value stream map is not just a flow chart of all the activities in a company. It is a flowchart that shows the path a specific product takes and highlights which processes are of value and which are not. 

Before starting your value stream mapping, set the boundaries on where the map would begin and end. For example, will it run from sourcing raw materials to storage? Or to delivery and customer service and complaints. 

3. Do the “Gemba Walk”

It is impractical to draw a practical value stream map without actually experiencing the production process yourself. You must conduct a waste identification exercise (also called a Gemba Walk) and not just read reports or base your conclusions on hearsay. You may have to do the walk multiple times, and it is recommended to do so at least twice. This helps you see the entire process or much of the process in an overview and also identify key areas of waste that may be missing from reports. 

4. Describe the steps In a VSM illustration 

The next stage identifies all the processes and functions that produce a consumer-value-added product or service. This doesn’t mean merely outlining a factory’s procedures. The study must be directed to mapping out information flow that will produce customer value, indicate other necessary steps and look for areas of waste. 

5. Indicate the flow

After visually representing the activities in the production process, the next step is to add the necessary arrows to show the direction of work materials and information. One can indicate the value-adding steps at the center of the map, and other activities (operations) are shown with vertical arrows drawn perpendicular to the value stream. 

See More: DevOps Roadmap: 7-Step Complete Guide

6. Gather important data 

Data gathering is the next phase in the value stream mapping process. Data collection can be done during the second VSM walkthrough. This data must be directly linked to each process and is used for further evaluation. Data collection should cover processing time for each step, resources needed, inventory at hand, working hours and shifts, the number of workers, processing time, batch size, daily customer demand, etc. 

7. Add data to the map and create a timeline

After data collection, you can return to the developing map and add that information in boxes under each process. These boxes should include the resources, workers, work time, machine time, number of goods processed, lead time, cycle time, packaging, and shipping time, where applicable. 

8. Identify waste 

The next step is crucial, dealing with the identification and removal of waste. Waste in the lean methodology is inefficiencies that can be classified into six groups.

  • Overproduction: This generates waste in every other aspect of the value stream. It means producing more goods than are needed at any particular time. 
  • Conveyance: This covers waste in transporting physical goods or services through more distance than necessary. It could be due to the spreading out of workstations or unnecessary reviews by too many members of a DevOps engineering team. 
  • Waiting: It invokes the idleness of machines or employees who cannot function due to unavailable or delayed resources from the previous process. It causes a downstream effect. 
  • Processing: Items should be manufactured with just enough resources to attain the standard quality. Anything above this is a waste. 
  • Motion: this includes time spent on processes such as looking for tools that should otherwise be available 
  • Correction: This is the time and resources spent on fixing errors made in production.

9. Develop and evaluate the value stream map 

The next stage is to evaluate the value stream map, including inputs where appropriate and eliminating unnecessary sections. Then you can create the final version of that organization’s current value stream map. You can also create a futuristic map – that is, an ideal state value stream map that illustrates the goals everyone should work towards achieving.

10. Set up an implementation plan

Following a value stream map is easier said than done. When implementation strategies are neglected, it becomes more of a decorative aspect of the company. To maximize effectiveness, use the value stream map to write out specific instructions that are actionable and measurable steps. Then constantly monitor outcomes to make adjustments when necessary. 

See More: What Is Serverless? Definition, Architecture, Examples, and Applications

Value Stream Mapping Examples

This project management technique has found applications in virtually all industries, being modified to fit into the nature of the processes carried out in that industry. Some key examples are listed below and can serve as models for crafting your value stream map. 

1. Value stream map in the healthcare industry

Healthcare forms one of the major industries in our present day. From hospitals to clinics and pharmacies, there is always the problem of patient waiting time, cost of services, and procedures. In healthcare, any delay in wait time is a potential for serious fatality. This stresses the importance of value stream mapping and how professionals can use it in the healthcare system to increase efficiency and decrease cost. 

Hospitals can create a value stream map that shows all the points a patient goes through, from when they step into the building to when they leave. This included the emergency rooms, nurse stations, consulting time, surgery preparation, etc. If adequately implemented, clinics and hospitals can identify steps that create bottlenecks, deploy more resources there, and improve overall performance. 

2. Finance value stream mapping 

Another area that is progressively using value stream mapping in its business strategy is the financial sector. The aim remains the reduction of waste and an increase in efficiency. One can automate some basic processes that lead to long bank queues. 

Updating old technology and hardware-based IT infrastructure can reduce wait time, conveyance, and motion. Using value stream maps, managers can identify sections of the business or services that do better than others, find underlying causes and implement better strategies in low-performing departments. 

3. Value stream mapping in manufacturing industries 

Value stream mapping was first outlined in manufacturing industries. It became popular in the 90s after Toyota released a guide on its production system. Ever since manufacturing companies have replicated the technique to improve their performance. 

In manufacturing companies, the process involved in making a finished product and getting it to the consumer is scrutinized, evaluated, and visualized using symbols and charts. Points of suboptimal performance that may slow down the entire operation are noted and improved. Also, areas of overproduction are identified. 

4. Value stream mapping used in corporate offices

Corporate organizations can also benefit from value stream mapping at an operational level. Irrespective of size, every office and department in an organization has several activities that slow down performance. Therefore they can, by implementing value stream mapping, improve efficiency. Areas like communication between departments, lack of office supplies, crowded printing areas, poor inventory, software and hardware malfunction, etc. frequently slow down productivity. When creating a value stream map, these bottlenecks are discovered and addressed. 

See More: What Is Jenkins? Working, Uses, Pipelines, and Features

Takeaway 

Value stream mapping is an incredibly versatile tool. Users can apply it at virtually any juncture of digital transformation, where you need to minimize waste and bring visible improvements. Scrum masters can use this technique to boost the productivity of agile teams, even as CTOs and CIOs leverage VSM to plan investments. Therefore, enterprises must comprehend VSM, its major components, and the actions required to develop a value stream map. 

Do you believe that value stream maps are essential for turbocharging DevOps productivity? Tell us on FacebookOpens a new window , TwitterOpens a new window , and LinkedInOpens a new window . We’d love to hear from you! 

MORE ON DEVOPS

Chiradeep BasuMallick
Chiradeep is a content marketing professional, a startup incubator, and a tech journalism specialist. He has over 11 years of experience in mainline advertising, marketing communications, corporate communications, and content marketing. He has worked with a number of global majors and Indian MNCs, and currently manages his content marketing startup based out of Kolkata, India. He writes extensively on areas such as IT, BFSI, healthcare, manufacturing, hospitality, and financial analysis & stock markets. He studied literature, has a degree in public relations and is an independent contributor for several leading publications.
Take me to Community
Do you still have questions? Head over to the Spiceworks Community to find answers.