Value stream mapping for non manufacturing environments

Learning Objectives

Participants will learn:
 What V l St
Wh t a Value Stream Map is – and what it i not.
M i d h t is t
 Key differences between manufacturing and
office/service VSMs.
 Best practices for holding a Value Stream Mapping
activity.
 How to define office & service product families.
 Step-by-step approach for creating current and future
state maps
maps.
 How to create an implementation plan from the future
state VSM.

© 2010 Karen Martin & Associates 2

Value Stream Administrative & Office
Mapping’s Beginnings Environments

Learning to See, The Complete Lean Enterprise,
Mike Rother & John Shook Beau Keyte & Drew Locher

Womack’s Five Principles of a
Lean Enterprise

 Value
 Value stream
 Flow
 Pull
 Perfection
— Jim Womack Lean Thinking, 1996 2003
Womack, Thinking 1996,


Value Stream Defined

Value Stream: All of the activities, required to
fulfill a customer request from order to delivery
(and beyond to cash received).

Value Stream

Process Process Process

Custom er

Customer Customer
Request Receipt


The Work We Do:
Degrees of Granularity

Rooftopp Value Value Stream
View Map
(Strategic) Stream


In the Metrics-Based
Weeds Step Step Step Process Map
(Tactical)
( )


Improvement Roles

Who? Accountability Tool
ategic

Leadership “What has to happen”
happen Value Stream
Stra

What
Mapping
Middle
Management
cal

Workforce “How it will happen” Kaizen Events
Events,
Tactic

How
Just-do-its,
and Projects


Why Value Stream Mapping?

To set strategy before diving into
tactics.
t ti
 The future state VSM is a macro
level blueprint for change; road map
Enables us to SEE the process.
Promotes s stems thinking /
systems
seeing the whole
 Helps us avoid sub optimizing
sub-optimizing


VSM Goal: System Efficiency

System Efficiency =
Optimal Value Stream
Performance

Individual Efficiency =
Sub-optimization


Types of Value Streams

Product Value Streams
Support Value Streams
Value Stream “Segments”



 Product Value Streams
 Goods – wide range of manufactured p
g products
 Services
 Healthcare – Emergency department patient flow, surgical patient flow,
outpatient testing
 Financial Services – credit application process, mortgage process,
equipment leasing process
 Education – college application to arrival
 Repair and maintenance – wind blade repair oil field maintenance
repair, maintenance,
refrigeration system service and repair
 Energy – Nuclear energy production, Oil production
 Government – Property tax assessment and processing
 Law enforcement – undercover operations, background check process
 Military – radar system development, troop deployment
 Non-Profit services – Donation processing, disaster aid process
 Etc.


(continued)
 Value Stream “Segments”
 Order fulfillment
 Product development
 New account set-up
 Laboratory services
 Imaging services
 Support Value Streams
 Recruiting, hiring and onboarding process
 Revenue cycle
 Information Technology request fulfillment
 Purchasing
 Accounts payable
 Physician credentialing


Why Value Stream Mapping?
(continued)

Shows the linkage between
information and material fl
i f ti d t i l flow.
Makes the disconnects and
obstacles t fl
b t l to flow visible at a
i ibl t
macro level
Metrics-based d i i making:
M t i b d decision ki
What are you going to do to
affect the numbers?


Key Metrics: Time

Process time (PT)
 The ti
Th time it takes to actually perform the work, if one is
t k t t ll f th k i
able to work on it uninterrupted
 Includes task-specific doing, talking, and thinking
task specific
 aka “touch time,” work time, cycle time
Lead time (LT)
( )
 The elapsed time from the time work is made available
until it’s completed and passed on to the next person or
department in th chain
d t t i the h i
 aka throughput time, turnaround time, elapsed time
 Includes Process Time not merely waiting time
Time, time.


Lead Time vs. Process Time
Scenario 1

Lead Time

Work Process Time
Work passed
Received to next step

LT = PT + Waiting / Delays
g y

Lead Time vs. Process Time
Scenario 2

Lead Time

Process Time
Work Work passed
Received to next step

LT = PT + Waiting / Delays
g y

Summary Metrics: Time

Activity Ratio (expressed as a percentage)
 The percentage of time anything is being done
to the work passing through the system
(whether value-adding or non value adding)
value adding non-value-adding)
 %Act = (∑PT ÷ ∑LT) × 100
 100 – %Activity = % Time Work is Idle
 Common finding = 1-10%
 Could also calculate %VA Activity to show how
little time is spent on value-adding activities.


Key Metrics: Quality

%Complete and Accurate (%C&A)
 The percentage of input that’s deemed “usable as is”
by the person doing the work
 % of incoming work where the downstream customer
can perform task without having to “CAC”:
 Correct information or material that was supplied
 Add information that should have been supplied
 Clarify information that should have or could have been
clearer
 Measured by the immediate downstream customer
and all subsequent downstream customers.
 Similar to first pass yield in manufacturing
manufacturing.


Summary Metrics: Quality

Rolled First Pass Yield (RFPY)
 The percent of value stream output that passes
through the process “clean,” with no “hiccups,”
no rework required.
required
 RFPY = %C&A x %C&A x %C&A…
 Common fi di = 0 15%
C finding 0-15%
 Multiply ALL %C&A’s, even if parallel processes


Current State Value Stream Map
Purchasing — Non-repetitive purchases less than $5,000

Inititate Req. 1

Originator
31
PT = 10 mins.
C&A = 10%
Supplies
Hard Copy

Vendor
Form File File Maker Quicken Excel ERP
Website

Data Entry

4 Enter 7 Approve in 8 Submit PO
Review 2 3 Review Review 5 Review 6 9 10
Review Req. 20 Reqs Requisition 10 Reqs ERP 63 Reqs to Supplier
Budget Requisition Requisition Requisition
External
Corp Purchasing Supplier
Sys Engineer Admin Asst Corp Purchasing
Finance Supervisor IS Manager Financial Mgr Manager
6 2 1 1 1 1 1
6
2 hrs. PT = 5 mins.
i 4 hrs. PT = 5 mins.
i 40 hrs. PT = 5 mins. 8 hrs. PT = 5 mins.
i 56 hrs. 80 hrs. PT = 20 mins.
i
PT = 15 mins.
C&A = 60% C&A = 95% C&A = 90% C&A = 100% C&A = 95% C&A = 98% C&A = 90%
C&A = 98%

0.25 days 0.5 days 5 days 1 days 1 days 0.5 days 3 days 7 days 10 days LT = 28.4 days
5 mins. 5 mins. 5 mins. 5 mins. 10 mins. 15 mins. 5 mins. 15 mins. PT = 65 mins.
AR = 0.477%

RFPY = 4.2%
PT = Process Time
LT = Lead Time
Customer Demand: C&A = % Complete & Accurate
615 requisitions per y ear AR = Activ ity Ratio (PT/LT x 100)
RFPY = Rolled First Pass Y ield

Future State Value Stream Map
Additional
IT access
Enter Req. 1
in ERP

Integrate Form Originator
File with File 31
Maker PT=30 mins.
C&A = 85%

Supplies
Requisition
Checklist
Vendor
File Maker ERP
Websites

Use budget in place
Cross of Quicken
Auto Notify
Training

Standard
Work for
review Approval

Additional
IT access Dedicated
Review Approve Place Buyers
2 3 4 5
Req. in ERP Order External
Supplier
Dept.
Dept
Supervisor Manager Corp Purchasing
2 6 hrs. 1 6 PT=20 mins.
8 hrs. 80 hrs.
4 hrs.
PT=5 mins. PT=5 mins. PT=20 mins.
C&A = 95% C&A = 90% C&A = 98%

0.5 days 0.75 days 1 days 10 days LT = 12.3 days
5 mins. 5 mins. 20 mins. PT = 30 mins.
AR = 0 508%
0.508%
RFPY = 71%
PT = Process Time
LT = Lead Time
615 requistions per year AR = Activity Ratio (PT/LT x 100)
RFPY = Rolled First Pass Yield

Purchasing Process
Projected Results

Current Projected %
Metric
M ti State
St t Future State
F t St t Improvement
I t
Lead Time 28.4 days 12.3 days 56.7%
Process Time 65 mins 30 mins 53.8%
53 8%
% Activity 0.48% 0.51% 6.3%
Rolled First
4.2% 71.0% 1,590%
Pass Yield
# Handoffs 10 5 50%
# IT Systems 6 3 50%
Freed capacity 2.1 FTEs 10%

© 2010 Karen Martin & Associates

Summary Metrics: Measuring
Productivity Gains

Labor Effort
Total PT (in hrs) X # occurrences/year
# FTEs =
Available work hrs/year/employee
Freed
= Current State FTEs – Future State FTEs
Capacity

Note: Improvement can be expressed as Freed
Capacity (FTEs), Time, or Labor Expense (or all)

# FTEs = Full Time Equivalents; 2 half-time people = 1 FTE


What do you do with freed capacity?

 Absorb additional work without increasing staff
 Reduce payroll through natural attrition
 Innovate – create new revenue streams
 Conduct ongoing continuous improvement activities
 D a b tt job with f
Do better j b ith fewer errors and hi h safety
d higher f t
 Talk and work with your customers and suppliers
 Mentor staff to create career growth opportunities
 Provide additional workforce development; cross-train
 Better work/life balance
 Slow down & think
 Get/stay caught up
 Do the things you haven’t been able to get to
 Collaborate with other areas


Basic Mapping Icons
External
Organization
Push Arrow
Operator / Employee

I
Work-in-Process Material receipts
& shipments

Process Block Go See Scheduling

Manual
PT= 25 m Information Flow
C/O=
C/O 40 m
In-box
2 Shifts
Takt= 60m Movement
Electronic
Data Block Information by Truck
y
Flow

Lead Time Hours Hours Hours
Process Time Minutes Minutes Minutes Minutes

Timeline

Current State Value Stream Map Demand = 15 per day
Outpatient Imaging Services
Customer Demand:
15patients perDay
(Takt Time1920seconds)
Pre-register Schedule 8 hours per day
Patient Appointment
Referring
Hospital
Physician
4 1
Lead Time = 24 days 5 3 Lead Time = 990 mins. 6 2 Lead Time = 12 mins.
Cycle Time = 30 mins. Cycle Time = 11 mins. % C&A = 65 %
Lead Time = 990 mins. Lead Time = 12 mins.
% C&A
%C&A = 100 % % C&A
%C&A = 98 %

CT=Cycle Time
LT=Lead Time
%C&A=% Complete & Accurate

Symposium E Pay Excel ADS Meditech Internet Fax Order PACS
Waiting Room Auto Fax 50%
Solutions
Management
M t Us Mail 25%
System
MD Mailbox 25%

Rework Loop
via Fax 25% of
the time

Prep Complete Transmit Read/Dictate Transcribe Review Print Send
Check-in Check-in
Patient Exam Images Exam Report Draft/Sign Reports Reports
Patient Patient
(Tech) (Tech) (Tech) (Radiologist) (MDI) (Radiologist) (Imaging) (Imaging)
(Admitting) (Imaging)
5 mins.

5
5 5 mins
mins.
3
6 45 mins. 2 7 30 mins.
2 8 5 mins.
2 9 248 mins.
2 10 365 mins.
6 11 960 mins.
2 12 110 mins.
2 13 120 mins.
6 14
Cycle Time = 2 mins. Cycle Time = 1 mins. Cycle Time = 10 mins. Cycle Time = 15 mins. Cycle Time = 3 mins. Cycle Time = 15 mins. Cycle Time = 5 mins. Cycle Time = 1 mins. Cycle Time = 1 mins. Cycle Time = 3 mins.
% C&A = 90 % % C&A = 98 % % C&A = 100 % % C&A = 90 % % C&A = 100 % % C&A = 95 % % C&A = 75 % % C&A = 95 % % C&A = 99 % % C&A = 90 %

0.0833 hrs. 0.0833 hrs. 0.75 hrs. 0.5 hrs. 0.0833 hrs. 4.13 hrs. 6.08 hrs. 16 hrs. 1.83 hrs. 2 hrs. LT = 32.5 hrs.
2 mins. 1 mins. 10 mins. 15 mins. 3 mins. 15 mins. 5 mins. 1 mins. 1 mins. 3 mins. CT = 56 mins.
CT/LT Ratio = 2.87%

Rolled First Pass
yield = 29%

VSM Champion: Paul Scanner
Created: July 17, 2007

Future State Value Stream Map Demand = 15 per day
Outpatient Imaging Services

Standard Customer Demand:
Work Co-locate
Work 15 patients perDay
Balance (Takt Time1920 seconds)
Schedule appt
8 hours per day
Pre-register
Referring
Hospital
Physician
3 1
Lead Time = 15 days 6 2 Lead Time = 45 mins.
Cycle Time = 11 mins. % C&A = 85 %
Lead Time = 45 mins
mins.
% C&A = 98 %
Risk
Reduction
(Joint CT=Cycle Time
Commision) LT=Lead Time
%C&A=% Complete & Accurate

Symposium E Pay Excel Meditech Internet
Waiting Room
a g oo
Fax Order PACS Auto Fax 80%
Solutions
Management Us Mail 15%
System MD Mailbox 5%

Pull System Value Stream 5S Rework Loop
(Supplies Alignment via Fax 10% of
Kanban) the time
Remove
Check in
and Reduce Work Batch
System Access Balancing
B l i Visual Reductions
R d ti
Standard Workplace Voice
Work Set-up Continuous Recognition
Reduction Flow

Prep Complete Transmit Read/Dictate Review Print Send
Check-in
Patient Exam Images Exam Draft/Sign Reports Reports
Patient
(Tech) (Tech) (Tech) (Radiologist) (Radiologist) (Imaging) (Imaging)
(Imaging)

5 mins. 35 mins. 5 20 mins. 6 5 mins. 7 120 mins. 8 420 mins. 9 2 mins. 10 30 mins. 11
3 4 2 2 2 2 2 2 6

Cycle Time = 1 mins. Cycle Time = 10 mins. Cycle Time = 10 mins. Cycle Time = 2 mins. Cycle Time = 15 mins. Cycle Time = 1 mins. Cycle Time = 1 mins. Cycle Time = 3 mins.
% C&A = 98 % % C&A = 100 % % C&A = 90 % % C&A = 100 % % C&A = 95 % % C&A = 95 % % C&A = 99 % % C&A = 90 %

0.0833 hrs. 0.583 hrs. 0.333 hrs. 0.0833 hrs. 2 hrs. 7 hrs. 0.0333 hrs. 0.5 hrs. LT = 11.3 hrs.
1 mins. 10 mins. 10 mins. 2 mins. 15 mins. 1 mins. 1 mins. 3 mins. CT = 43 mins.
CT/LT Ratio = 6.32%

Rolled First Pass
yield = 40%

VSM Champion: Paul Scanner
Created: July 18, 2007

Outpatient Imaging
Projected Results

Current Projected %
Metric State Future State Improvement
Lead Time 32.5 hrs 11.3 hrs 65%
Process Time 56 mins 43 mins 23%
Percent Activity 2.9% 6.3% 117%
Rolled First
29%
% 40%
% 38%
%
Pass Yield
# Macro Steps 14 11 21%
Tech turnover
100% 25% 75%
(annual)
Note: Freed
N t F d capacity (PT reductions) allowed th organization t earn
it d ti ) ll d the i ti to
$500,000 additional annual revenue with no additional headcount

Value Stream Mapping Process
Define
D fi Products (good or services) with
Product Family common process steps

Foundation (the basis) for the
F d ti (th b i ) f th
Document Current future state; 70-80% accurate is
State acceptable (directionally correct)

Create flow by eliminating waste
Design Future it is now obvious from your
3 Day
State current state map); typically 3-6
at
Repea

Event months out

Create Include accountability and
Implementation Plan timeframes for completion
ti f f l ti

Implement! The
Th goal of mapping!
l f i !

Scoping: One VSM per “Product Family”

Group Product Families by similar downstream processes, steps or equipment.

Process Steps & Equipment

Step A Step B Step C Step D Step E Step F Vol.
Product
ABC X X X X X 50
Product
XYZ X X X X X 73
Product
IBM X X X 2
Products
Product
AWR X X X X 5
Product
ACC X X X 15
Product
SUB X X X 12
Product
IDR X X X X X X 1

Narrowing the Scope:
Selected Specific Conditions

Non Exempt
Non-Exempt
Staff
Replacements
Exempt
Staff
Hiring
Process
New Non-Exempt
Positions Staff

Exempt
Staff


Narrowing the Scope:
Selected Specific Conditions
Units

Domestic Consumables
C bl
Warranty
Service Parts
Non-
Order Warranty
Fulfillment
Process
Units

International
I t ti l Consumables
C bl
Warranty
Service Parts
Non-
Non
Warranty

Value Stream Mapping Activity

 3-day activity; three deliverables
 Day 1 – Document and analyze the current state
y y
 Go to the Gemba!
 Day 2 – Design the future state (3-6 months out)
 Day 3 – Create the implementation plan
 Sequestered team composed primarily of those who can
authorize change
 Typically manager and above
 The team goes to the gemba to obtain the metrics from the
frontlines doing the work.
 Leadership learning and development is a powerful side
benefit.
 K success f t - i t i b i fi
Key factor interim briefings t communicate and
to i t d
achieve consensus.

Interim Briefings

Day 1 – “Here’s what we’ve learned.”
 Establishes a mental framework for embracing
improvements; “sells” the need for improvement.
Day 2 – “Here’s what we plan to do.”
 Does anyone object? If so, why?
y j y
 Challenge policies and paradigms
Day 3 – “Here’s how we re going to execute ”
Here s we’re execute.
 Priorities, approach, timeframes, accountability
 Obtain full commitment right then and there
there.


Value Stream Mapping

Planning Your Activity:
A well-developed charter aids in
ll d l d h t id i
communication, consensus
building and planning


Value Stream Mapping Charter
Event Scope Leadership / Coordination Schedule
Executive 3 days typically; sequential is
Value Stream Engineering design, ED patient flow , Credit processing, etc. VP or C-level Event Date(s)
Sponsor best

Specific What circumstances you're including and Value Stream If needed - often Director or Start/End
6 hrs minimum; 7 or 8 is best
Conditions excluding? Champion Manager level Times
Customer Demand How many times is this done per wk, mo, or yr.?
Facilitator Skilled person leading the activity Location Need ample wall space
Trigger What need does the value stream address?
First Step Task on first process block Meals Always a nice touch; keeps
Team Lead Not always needed
Last Step Task on last process block
p Provided? the team from wandering.
g

Boundaries & Interim Aid in consensus building and
What is the team NOT authorized to change? The person arranging logistics
Limitations Briefing(s) organizational learning.
Coordinator (reserving the room, ordering food,
FS Implementation sending meeting notices, etc.) Briefing List required attendees; others
Typically 90-120 days
Timeframe Attendees are optional
Event Drivers Mapping Team
1 Wh are you doing thi ?
Why d i this? Function Name Contact Information
2 1 Leadership-heavy
3 2
4 3
5 4
Goals & Measureable Objectives
j 5
1 Aim for objectives w/ measurable targets (from X to X). 6
2 7
3 8
4 9
5 10
Planned Deliverables On-Call
On Call Support
1 Current state VSM Function Name Contact Information
2 Future state VSM 1 SMEs that may not be needed full time
3 Implementation Plan 2
4 3
5 4
Potential Obstacles Approvals
1 To the team's success with the mapping activity. Executive Sponsor Value Stream Champion Facilitator
2
3 Signature: Signature: Signature:
Date: Date: Date:
4
37

Value Stream Mapping Facilitator
Range of Necessary Traits
 Skills / Knowledge  Personality / Energy
 Lean philosophy
ea p osop y  Naturally cu ous
atu a y curious
 Improvement tools  Challenging, yet supportive
 Project & time management  Positive, upbeat, energetic
 Mediation; consensus  Pushy without irritating
building
b ildi  Thinks fast on one’s feet
 People effectiveness – from  Objectivity / Fairness
front line workers to execs
 No attachment to the work
 Authority / Respect being improved
b i i d
 Recognized change agent /
influence leader
 Trustworthyy
 Comfortable removing
obstacles & reaching out to
senior leadership


The timeline is the most important of the
three defining characteristics of a
VSM:
1) information flow
2) product flow
3) timeline

If your map doesn’t include a timeline, it
is not a VSM. If your map has swim
y p
lanes, it’s not a VSM.

Order Initiation
Typical VSM Components - Current State Map
Demand = XXXX
Manufacturing
g May 8, 2008
Robert Parker
formation Flow

Production
SUPPLIER Control CUSTOMER
n

1
Inf ow

Process 1 I Process 2 I Process 3 I Process 4
roduct Flo

2
Pr

Hours Hours Hours Hours LT
Timeline

3 Minutes Minutes Minutes Minutes PT

Typical VSM Components - ABC Value Stream
Current State Map
Office / Service Demand = XXXX/yr
Date
Key Contact
formation Flow

CUSTOMER
n

1
I.T. I.T. I.T.
Inf ow

Process 1 Process 2 Process 3 Process 4
roduct Flo

2
Pr

Hours Hours Hours
LT
eline

3 Minutes Minutes Minutes Minutes PT
Time

Concurrent Work / Parallel Flows

Process Process

LT = 8 hrs


LT = 4 hrs

Bring longest lead time to the timeline,
unless it’s a “dead end step.”


Common Differences - Manufacturing vs. Office VSMs
Manufacturing Office
Customer icon Upper right Center
Supplier icon Upper left None
“The thing we’re
The thing” we re Raw material sub-
material, sub Paper, verbal,
Paper verbal and
following assemblies, finished goods electronic Information
More structured / Multiple I.T. systems and
Information Flow
y
formalized I.T. systems work-arounds

Schedule notification Multiple points across VSM Work not scheduled

Material flow (via
(
Yes
Y Sometimes
S ti
hollow arrow)
WIP icon Inventory triangle In-bin (if preferred)
Percent Complete &
Quality M t i
Q lit Metric First P
Fi t Pass Yield (FPY)
Yi ld
Accurate (%C&A)
Only applicable with
Takt Time Typically can be applied
dedicated resources
LT determination for Based on WIP between Based on a single item
each block process blocks passing through

Preparing to Map

Schedule time to go to the Gemba
 Prepare frontlines for questions the team will ask;
establish a safe haven for them to communicate the
true current state (no matter how ugly it is) to high
level leaders they may not usually interface with.
 No written procedures allowed – creates bias toward
communicating what should h
i ti h t h ld happen rather th what
th than h t
does happen.


Preparing to Map (continued)

Draw map manually!
 11 x 17” paper
 Or 36” wide plotter paper and 3 x 6” post-its for
process blocks (my preference)
Only convert to electronic medium if absolutely
necessary (e-distribution, training, etc.)
(e distribution,
 iGrafx FlowCharter (my preference)
 Systems2Win – Excel-based
y
 Minitab
 e-VSM
 Others

Step 1

Label your map (draw manually or use 36”
wide plotter paper and 3 x 6” post-its)
 Value stream name
 Current or future state
 Customer demand (volume of work p time
( per
period)
 Takt time (if relevant)
 Date
 Facilitator’s name (and/or team)
( )


Takt Time:
The Key to Continuous Flow

Available work time
Takt ti
T kt time = “Touch down”
“T hd ”
Customer demand

480 minutes/day
Takt time = = 10.6 mins
45 new accounts

OR…
Time Available divided by what Kustomer Takes


Step 2

 Identify all blocks in the process (target 5-15 blocks)
 Customer icon is placed in upper right or middle
 Upper right if supplier exists (supplier is placed in upper left)
 Middle position if a separate supplier doesn’t exist
 Supplier (if relevant) is placed in upper left
 Each block (post-it) contains an activity or group of activities that
occurs before a break in the timeline occurs - typically a handoff to
another function/work team
team.
 Activity format is verb/noun – what happens to what
 Include the function who performs the task
 Include number of workers who perform the task
 Include any obstacles to flow – batches, shared/inaccessible
resources, system downtime, etc.
 Consider walking the process


Post-it Conventions

Process
(Verb/Noun)
( )

Function

# Staff
(if relevant)
Barriers to flow

Step 3

Identify all I.T. systems used in the
process and information flow
 For most VSMs, these are placed above the
process blocks
 In very complicated VSMs with two rows of
process blocks, I.T. systems can be placed
between the rows, if necessary.
 Note
N t any scheduling th t occurs (
h d li that (rare i
in
current state)
 Who tells h
Wh t ll whom t d what?
to do h t?

Step 4

Number the process blocks from left to
right.
 If parallel processes exist, use alpha modifiers
– e.g. 8A, 8B, etc.
Connect the customer, supplier (if present)
and process blocks
 “Striped” arrow for p
p push systems
y
 Hollow arrow for material flow
Connect and I T systems
I.T.

Post-it Conventions
Process Block #
Process
(Verb/Noun)
( )

Function

# Staff
(if relevant)
Barriers to flow

PT (process time)
(p )
% Complete &
LT (Lead time)
Accurate

Depicting e-Information Flow
I.T. I.T.
Application Application
Arrow pointing to Two-headed arrow:
I.T.
I T application:
li ti Staff b th i
St ff both views and
d
Staff enters data enters data
Process Process
Block Block

I.T.
Application #1 I.T. #2 I.T.
Application Application
Arrow pointing from
I.T. application:
Staff views data Lightning bolt arrow:
Process
Block
Application #1 auto-populates
application #2

55


Inititate Req. 1

Originator
31
PT = 10 mins.
C&A = 10%
Supplies
Hard Copy

Material
flow
Vendor
Website

ERP auto-
populates
Data Entry
P.O.

External
6 2 1 1 1 1 1
6
2 hrs. PT = 5 mins.
i
PT = 15 mins.
C&A = 60% C&A = 95% C&A = 90% C&A = 100% C&A = 95% C&A = 98% C&A = 90%
C&A = 98%

AR = 0.477%

RFPY = 4.2%
Push PT = Process Time
LT = Lead Time
Arrow
A Customer Demand:
615 requisitions per y ear
C&A = % Complete & Accurate
AR = Activ ity Ratio (PT/LT x 100)

Step 5

Add key metrics for all process blocks
 Process Time (PT)
 Lead Time (LT)
 Percent Complete & Accurate (%C&A)
P tC l t A t
Add additional obstacles to flow if any are
identified (e.g. b t h
id tifi d ( batches, shared resources
h d
system availability/speed, etc.)
Add th WIP (
the (work-in-process) for all
ki )f ll
process blocks.


Three Places WIP Accumulates

Before the process block – work not yet begun.
Within the process block – work currently being
performed.
After the process block – Work that’s complete
complete,
but hasn’t been passed on
WIP WIP

WIP
Step 1 Step 2 Step 3



Inititate Req. 1

Originator
31
PT = 10 mins.
C&A = 10%
Supplies
Hard Copy

Vendor
Website

Data Entry

External
6 2 1 1 1 1 1
6
2 hrs. PT = 5 mins.
i
PT = 15 mins.
C&A = 60% C&A = 95% C&A = 90% C&A = 100% C&A = 95% C&A = 98% C&A = 90%
C&A = 98%

AR = 0.477%

RFPY = 4.2%
PT = Process Time
LT = Lead Time
615 requisitions per y ear AR = Activ ity Ratio (PT/LT x 100)

WIP

Step 6

Create timeline & calculate summary
metrics
 Timeline PT Sum
 Timeline LT Sum

 A ti it
Activity Ratio
R ti
 Rolled First Pass Yield (RFPY)


How to Treat Lead Time in
Office/Service Environments
Lead Time

Process Time

Process 1 Process 2

LT LT

PT PT

Office/Service Lead Time ―
• From the time work is made available until it’s been completed AND passed on
to the next person/work group/department in the process.
• Placed on the peak of the timeline to the left of the process block it refers to.
• Represents total throughput time, including process time; not merely wait time.


Projected Results
j
Projected Projected %
Metric Current State
Future State Improvement
Timeline L d
Ti li Lead
Time
Timeline
Process Time
Activity Ratio
Rolled Fi t
R ll d First
Pass Yield
Total Process
Time ( blocks)
(all )
Labor Effort
Others, as
relevant
63

Typical Current State Findings

Unnecessary Necessary
NVA NVA

Available Available to
to work on Value Add next step

Islands of activity (process times) within long lead times.


Step 7

Identify all value-adding (VA) and necessary
non-value-adding (N) steps
l ddi t
 Add “VA” or “N” smaller post-it to relevant process
blocks
 All unnecessary non-value-adding blocks remain
unlabelled
Enter Check Approve
Order Credit Order
Customer Rep Finance Sales Rep

VA N Unnecessary
Value-adding Necessary Non-Value-Adding
Non-Value-Adding


Customer-Defined Value

Value-Adding (VA) - any operation or
activity your external customers value
ti it t l t l
and are (or would be) willing to pay for.
Non-Value-Adding (NVA) - any operation
N V l Addi ti
or activity that consumes time and/or
resources but does not add value to the
product (good or service) the customer
receives.
receives
 Necessary – support processes, regulatory
requirements, etc.
 Unnecessary – everything else - WASTE

Work Effort as Defined by the
External Customer

Unnecessary N
U Non-
value adding
Necessary non-value-
adding
Value-adding

Designing the Future State Value
Stream

Target All Waste!


Eight Wastes (Muda)

Overproduction Motion (people)
y
Inventory p
Transportation
Waiting (material/data)

Over Processing
Over-Processing Underutilized
people
Errors


Future State Design

Goal: Removing all obstacles to flow (
g (“the
thing” should never stop)
 Batches
 Rework
 WIP / Bottlenecks
 Handoffs
 Setup / changeover
 Physical layout
 Motion & transportation


Eight Questions for
Future State VSM

1. What are the customer requirements? What’s the takt
time?
2. With goods, will we produce to order or to finished
g
goods inventory? (
y (With services, y you’re almost always y
producing to order.)
3. Where can continuous flow be put in place?
4. Where should pull systems b i l
4 Wh h ld ll t be implemented?t d?
5. What is the single point of scheduling?
6.
6 How do we level the load and the mix?
7. What should the management time frame be?
8. What process improvements are necessary to achieve
the future state? -- Rother & Shook, Learning to See
© 2010 Karen Martin & Associates

Future State Design
Considerations

 Error-proof (including  Balance work to meet
incoming customer takt time requirements
requests)  Co-locate and cross-
 Standardize the work train work teams
 Eliminate steps / handoffs  Implement pull
 Eliminate waste  Implement visual
 Combine steps management
 Create parallel paths  Organize the workplace
 Alter task sequencing and/or so problems are visible
timing R d
Reduce changeover
h
 Eliminate or reduce batches  Eliminate motion &
 Level demand p
transportation


Building a Lean Enterprise

Process
Stabilization
Tools

Building a Lean Enterprise

Flow Enabling
Tools

Future State Icons

Supermarket
Withdrawal

Combined Steps Production
Kanban
Kanban
Arriving Withdrawal
Withd l
in Batches Kanban

Eliminated Step Signal
Kanban

Max 8 “things” First-In Buffer Stock Kanban
FIFO First-Out Post
(max WIP
defined)

Leveling, Kanban
OXOX Mix d/
Mi and/or Path
Volume
Kaizen Burst

Projected Results
j
Projected Projected %
Metric Current State
Future State Improvement
Lead Time

Process Time

% Activity
Rolled First
Pass Yield
Labor Effort

77

Future State Implementation Plan
Value Stream Outpatient Imaging Implementation Plan Review Dates
Executive Sponsor Allen Ward 11/1/2007
Value Stream Champion Sally McKinsey 11/21/2007
Value Stream Mapping Facilitator Dave Parks 12/13/2007
Date Created 10/18/2007 1/10/2008
Block Implementation Schedule (weeks) Date
Goal / Objective Improvement Activity Type Owner
# 1 2 3 4 5 6 7 8 9 10 11 12 Complete
Implement standard work for referral
2 Improve quality of referral KE Sean O'Ryan
process

Reduce lead time beween schedulingand Dianne
3, 4 Cross-train and colocate work teams PROJ
preregistration steps Prichard

Eliminate the need for two patient check- Michael
5, 6 Collect copays in Imaging KE
ins O'Shea

Dianne
6 Eliminate bottleneck in waiting area
g Balance work / level demand KE
Prichard
Pi h d

Eliminate lead time associated with
9 Implement voice recognition technology PROJ Sam Parks
transcription step

10 Eliminate batched reading Reduce setup required KE Sam Parks

Reduce inventory costs, regulatory risk Michael
7 5S CT supplies area; implement kanban KE
and storage needs O'Shea

12 Reduce delay in report delivery Implement additional fax ports PROJ Martha Allen

Increase percentage of physicians
12 Reduce delay in report delivery
y p y receiving electronic delivery (
g y (rather than KE Martha Allen
hard copy)

Approvals
Executive Sponsor Value Stream Champion Value Stream Mapping Facilitator
Signature: Signature: Signature:

Date: Date: Date:

PACE Prioritization Matrix
Policy
21 5 10
I.T.
IT

Easy 6 15
13 Process
ion
mentati

2 20
14
23 18 17 25
7
Ease of Implem

9
26
16 1 8
12
22
24 19
27 4
E
Difficult
t

11
3

High Low
Anticipated Benefit 80

About Karen Martin

 Early career as a scientist; migrated to quality
& operations design in the mid 80’s
mid-80 s.
 Launched Karen Martin & Associates in 1993,
focusing on operations design and Total Quality
Management.
Management
 Began applying “white collar” lean in 2001.
 Co-author of The Kaizen Event Planner:
Achieving Rapid Improvement i Offi
A hi i R id I t in Office,
Service, and Technical Environments; co-
developer of Metrics-Based Process Mapping:
An Excel-Based Solution
Excel Based Solution. Karen Martin, Principal
Karen Martin & Associates
 University of California, San Diego Lean
Enterprise program instructor.
 F more information: www.ksmartin.com
For i f ti k ti


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