Value Stream Mapping in Office and Service
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The document discusses value stream mapping (VSM) as a tool to improve office and service processes, emphasizing the importance of understanding the entire value stream from customer request to delivery. It details various examples of value streams across different industries, outlines the steps for creating a value stream map, and highlights the benefits of VSM in promoting systems thinking and improving overall efficiency. The presentation culminates in methods for analyzing and categorizing process steps to enhance performance metrics.
Value Stream Mapping in Office and Service
- 1. Get Lean - Value Stream Mapping for Office and Service Karen Martin Kim Scott President iGrafx Senior Consultant, The Karen Martin Group, Inc. Lean Six Sigma Black Belt
- 2. What will you learn? Value Stream Mapping helps you understand and improve your Office and Service processes. Digitalizing VSMs is easy and makes sharing a snap.
- 3. Introducing Karen Martin • Founder: The Karen Martin Group, Inc. (1993) • Consultant / Coach: Lead Lean transformations & develop people in office, service and knowledge environments. • Teacher: University of California, San Diego’s Lean Enterprise program. • Author: Winner - 2013 Shingo Research Prize
- 5. Value Stream Mapping’s Roots Mike Rother & John Shook, 1999 Beau Keyte & Drew Locher, 2004 Whenever there is a product for a customer, there is a value stream. The challenge lies in seeing it. — Mike Rother & John Shook, Learning to See 5
- 6. 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 6
- 7. The Work We Do: Degrees of Granularity Macro View Strategic; Value Value Stream heavy leadership Map involvement Stream Process Process Process Micro View Metrics-Based Tactical; heavy Step Step Step Process Map frontline involvement 7
- 8. Office/Service Value Stream Examples: By Industry • Repair/maintenance – Customer request to revenue received • Financial services – Mortgage application • Law – Litigation value stream • Healthcare – Patient care; revenue cycle • Technology – Software development • Government – Permitting • Construction – Large equipment installation • Law enforcement – Arrest processing • Engineering/architecture – Design development • Oil & Gas – Fossil fuel exploration & production 8
- 9. Support (Value-enabling) Value Streams • Estimating / RFQ response • Hiring – Recruitment to 1st (or 90th) day • New product development • Business plan development • Annual sales meeting planning & execution • Contract development & execution • And more… 9
- 10. Value Stream Mapping Benefit: Seeing the Whole 60,000 foot view; Rooftop view 10
- 11. VSM Promotes Systems Thinking System Efficiency = Optimal Value Stream Performance Individual Efficiency = Sub-optimization 11
- 12. Truth How are we really performing? Truth Truth Truth CLARITY Truth Truth What’s our customer Truth really experiencing? Truth Truth 12
- 13. Value Stream Mapping: As Much Art as Science 13
- 14. Create a Value Stream “Storyboard” with Paper & Post-Its (Team-Based) 14
- 15. Basic Value Stream Map ABC Technology, Inc. Current State Value Stream Map Softw are Upgrade Order Fulfillment Customer Demand = 500/year Custom er Information Flow IT-1 IT-2 1 2 3 4 5 Process 1 Process 2 Process 3 Process 4 Process 5 ` Material & Dept A Dept B Dept C Dept D Dept E Data Flow 5 2 45 pcs 3 10 pcs 2 4 LT = 1 days LT = 0.5 days LT = 2 days LT = 0.5 days LT = 1 days PT = 10 mins. PT = 5 mins. PT = 3 mins. PT = 5 mins. PT = 15 mins. %C&A = 99% %C&A = 75% %C&A = 99% %C&A = 99% %C&A = 95% Timeline 480 mins. 240 mins. 2 days 240 mins. 480 mins. Total LT = 5 days 10 mins. 5 mins. 3 mins. 5 mins. 15 mins. Total PT = 38 mins. Activity Ratio = 1.6% Rolled %C&A = 69.1%
- 16. Value Stream Mapping Charter Event Scope Leadership / Coordination Schedule Executive 3 days typically; sequential is Value Stream Contract processing, rebate 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? (type of cust, time of year, etc.) Champion Manager level Times Customer Demand How many times is this done per wk, qtr, 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 Provided? the team from wandering. 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 Why are you doing this? What are the current state issues? Function Name Contact Information 2 1 Leadership-heavy 3 2 4 3 5 4 Goals & Measureable Objectives 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 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: 4 Date: Date: Date: 16
- 17. Value Stream Mapping Process Define Product Family Document Current State Design Future State 3 Day Event Create Transformation Plan Execute!
- 18. The Office Version of Product Families Units Domestic Consumables Warranty Service Parts Non-Warranty Order Fulfillment Process Units International Consumables Warranty Service Parts Non-Warranty
- 19. Value Stream Mapping Process Define Product Family Document Current State Design Future State 3 Day Event Create Transformation Plan Execute!
- 20. Step 1 – Define Process Blocks • Identify all process blocks in the value stream (target 5-15 blocks) – Each process block (post-it) contains an activity or group of activities that occurs before a significant break in the timeline occurs (typically build up of WIP or handoff to another function) – Activity format is verb/noun – what happens to what – WALK THE VALUE STREAM! 20
- 21. Value Stream Mapping Components ABC Technology, Inc. Current State Value Stream Map Softw are Upgrade Order Fulfillment Customer Demand = 500/year Custom er IT-1 IT-2 1 2 3 4 5 Process 1 Process 2 Process 3 Process 4 Process 5 ` Dept A Dept B Dept C Dept D Dept E 5 2 45 pcs 3 10 pcs 2 4 LT = 1 days LT = 0.5 days LT = 2 days LT = 0.5 days LT = 1 days PT = 10 mins. PT = 5 mins. PT = 3 mins. PT = 5 mins. PT = 15 mins. %C&A = 99% %C&A = 75% %C&A = 99% %C&A = 99% %C&A = 95% 480 mins. 240 mins. 2 days 240 mins. 480 mins. Total LT = 5 days 10 mins. 5 mins. 3 mins. 5 mins. 15 mins. Total PT = 38 mins. Activity Ratio = 1.6% Rolled %C&A = 69.1%
- 22. Step 2 – Define I.T. Systems • Identify all I.T. systems used in the process and information flow – Note any scheduling that occurs (calendar, system, etc.) – Who tells whom to do what? How do they tell them? 22
- 23. Value Stream Mapping Components ABC Technology, Inc. Current State Value Stream Map Softw are Upgrade Order Fulfillment Customer Demand = 500/year Custom er IT-1 IT-2 1 2 3 4 5 Process 1 Process 2 Process 3 Process 4 Process 5 ` Dept A Dept B Dept C Dept D Dept E 5 2 45 pcs 3 10 pcs 2 4 LT = 1 days LT = 0.5 days LT = 2 days LT = 0.5 days LT = 1 days PT = 10 mins. PT = 5 mins. PT = 3 mins. PT = 5 mins. PT = 15 mins. %C&A = 99% %C&A = 75% %C&A = 99% %C&A = 99% %C&A = 95% 480 mins. 240 mins. 2 days 240 mins. 480 mins. Total LT = 5 days 10 mins. 5 mins. 3 mins. 5 mins. 15 mins. Total PT = 38 mins. Activity Ratio = 1.6% Rolled %C&A = 69.1%
- 24. Step 3 – Add Data • Key metrics for all process blocks – Process Time (PT) – Lead Time (LT) – Percent Complete & Accurate (%C&A) • Work-in-process (WIP) at every step. • Significant barriers to flow (e.g. batching, shared resources, system downtime, etc.) 24
- 25. Post-it Conventions Block # Process (Verb/Noun) Function # Staff (if relevant) Significant Barriers to Flow Process Time %C&A Lead Time
- 26. Value Stream Mapping Components ABC Technology, Inc. Current State Value Stream Map Softw are Upgrade Order Fulfillment Customer Demand = 500/year Custom er IT-1 IT-2 1 2 3 4 5 Process 1 Process 2 Process 3 Process 4 Process 5 ` Dept A Dept B Dept C Dept D Dept E 5 2 45 pcs 3 10 pcs 2 4 LT = 1 days LT = 0.5 days LT = 2 days LT = 0.5 days LT = 1 days PT = 10 mins. PT = 5 mins. PT = 3 mins. PT = 5 mins. PT = 15 mins. %C&A = 99% %C&A = 75% %C&A = 99% %C&A = 99% %C&A = 95% 480 mins. 240 mins. 2 days 240 mins. 480 mins. Total LT = 5 days 10 mins. 5 mins. 3 mins. 5 mins. 15 mins. Total PT = 38 mins. Activity Ratio = 1.6% Rolled %C&A = 69.1%
- 27. Key Metrics: Time Scenario 1 Lead Time (LT) Work Process Time (PT) Work passed to Received next step LT = PT + Waiting / Delays 27
- 28. Key Metrics: Time Scenario 2 Lead Time (LT) Process Time Work Work passed to Received next step LT = PT + Waiting / Delays 28
- 29. Key Metrics: Quality • %Complete and Accurate (%C&A) – % of incoming work that’s “usable as is”: the downstream customer can perform task without having to do rework: • Correct information or material that was supplied • Add information that should have been supplied • Clarify information that should have or could have been clearer – Determined by the person receiving the input; metric goes on the output block. 29
- 30. Value Stream Mapping Components ABC Technology, Inc. Current State Value Stream Map Softw are Upgrade Order Fulfillment Customer Demand = 500/year Custom er IT-1 IT-2 1 2 3 4 5 Process 1 Process 2 Process 3 Process 4 Process 5 ` Dept A Dept B Dept C Dept D Dept E 5 2 45 pcs 3 10 pcs 2 4 LT = 1 days LT = 0.5 days LT = 2 days LT = 0.5 days LT = 1 days PT = 10 mins. PT = 5 mins. PT = 3 mins. PT = 5 mins. PT = 15 mins. %C&A = 99% %C&A = 75% %C&A = 99% %C&A = 99% %C&A = 95% 480 mins. 240 mins. 2 days 240 mins. 480 mins. Total LT = 5 days 10 mins. 5 mins. 3 mins. 5 mins. 15 mins. Total PT = 38 mins. Activity Ratio = 1.6% Rolled %C&A = 69.1%
- 31. Step 4 – Create Timeline • Create timeline • Calculate summary metrics – Timeline PT Sum – Timeline LT Sum – Activity Ratio (AR) – Rolled %C&A 31
- 32. Summary Metrics: Time • Activity Ratio – The percentage of time anything is being done to the work passing through the system (whether value-adding or non-value-adding) – (∑PT ÷ ∑LT) × 100 – Common current state finding in office/service = 1-10% (across entire value stream) 32
- 33. Summary Metrics: Quality • Rolled % C&A – The percent of value stream output that passes through the process “clean,” with no “hiccups,” no rework required. – (%C&A x %C&A x %C&A…) x 100 – Common current state finding in office/service = 0-15% 33
- 34. Value Stream Mapping Components ABC Technology, Inc. Current State Value Stream Map Softw are Upgrade Order Fulfillment Customer Demand = 500/year Custom er IT-1 IT-2 1 2 3 4 5 Process 1 Process 2 Process 3 Process 4 Process 5 ` Dept A Dept B Dept C Dept D Dept E 5 2 45 pcs 3 10 pcs 2 4 LT = 1 days LT = 0.5 days LT = 2 days LT = 0.5 days LT = 1 days PT = 10 mins. PT = 5 mins. PT = 3 mins. PT = 5 mins. PT = 15 mins. %C&A = 99% %C&A = 75% %C&A = 99% %C&A = 99% %C&A = 95% 480 mins. 240 mins. 2 days 240 mins. 480 mins. Total LT = 5 days 10 mins. 5 mins. 3 mins. 5 mins. 15 mins. Total PT = 38 mins. Activity Ratio = 1.6% Rolled %C&A = 69.1%
- 35. Current State Value Stream Map Demand = 15 per day Outpatient Imaging Services Customer Demand: 15 patients per Day (Takt Time 1920 seconds) 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 = 100 % % 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 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. 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 % 5 minutes 45 minutes 30 minutes 5 minutes 248 minutes 365 minutes 960 minutes 110 minutes 120 minutes L/T = 13464 minutes 2 minutes 11520 1 minutes 10 minutes 15 minutes 3 minutes 15 minutes 5 minutes 1 minutes 1 minutes 3 minutes VA/T = 11576 minutes minutes Rolled First Pass yield = 29%
- 36. Outpatient Imaging Value Stream Current State Findings Current Projected % Metric State Future State Improvement Lead Time 32.5 hrs Process Time 56 mins Activity Ratio 2.9% Rolled %C&A 29% 36
- 37. Step 5 – Determine VA & N Steps • Identify all value-adding (VA) and necessary non-value-adding (N) steps – Add “VA” or “N” smaller post-it to relevant process blocks – All unnecessary non-value-adding blocks remain unlabelled 37
- 38. Customer-Defined Value • Value-Adding (VA) - any operation or activity your external customers value, are (or would be) willing to pay for, or it’s a requirement of doing business with them. • Non-Value-Adding (NVA) - any operation or activity that consumes time and/or resources but does not add value to the product (good or service) the customer receives. – Necessary – support processes, regulatory requirements, etc.; also referred to as “essential” or “value-enabling.” – Unnecessary – everything else - WASTE 38
- 39. Eight Wastes (Muda) • Overproduction • Motion (people) • Inventory • Transportation • Waiting (material/data) • Over-Processing • Underutilized people • Errors 39
- 40. Typical Current State Findings Unnecessary Necessary NVA NVA Work is idle Order Delivery Value Add Islands of activity (process times) within long lead times. 40
- 41. Value Stream Mapping Process Define Product Family Document Current State Design Future State 3 Day Event Create Transformation Plan Execute!
- 42. Future State Design • Goal: Eliminate all redundancies and barriers to flow (the work should never stop) – Batches – Rework – Bottlenecks & WIP – Handoffs – Setup / changeover – Physical layout – Motion & transportation 42
- 43. Future State Value Stream Map Outpatient Demand = 15 per day 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. % C&A = 98 % Risk Reduction (Joint CT=Cycle Time Commision) LT=Lead Time %C&A=% Complete & Accurate Symposium E Pay Excel Meditech Internet Fax Order PACS Auto Fax 80% Waiting Room 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 Visual Reductions 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% Note: Process Time (PT) is referred to as Cycle Time (CT) on this map
- 44. Outpatient Imaging Value Stream Projected Future State Results Current Projected % Metric State Future State Improvement Lead Time 32.5 hrs 11.3 hrs 65% Process Time 56 mins 43 mins 23% Activity Ratio 2.9% 6.3% 117% Rolled %C&A 29% 40% 38% 44
- 45. Value Stream Mapping Process Define Product Family Document Current State Design Future State 3 Day Event Create Transformation Plan Execute!
- 46. 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 Balance work / level demand KE Prichard 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 receiving electronic delivery (rather than KE Martha Allen hard copy) Approvals Executive Sponsor Value Stream Champion Value Stream Mapping Facilitator Signature: Signature: Signature: Date: Date: Date:
- 47. Value Stream Mapping Process Define Product Family Document Current State Design Future State 3 Day REPEAT Event Create Transformation Plan Execute!
- 48. Common Differences - Manufacturing vs. Office VSMs Manufacturing Office Customer icon Upper right Center Supplier icon Upper left None Raw material, sub-assemblies, Paper, verbal, and electronic “The thing” we’re following finished goods Information More structured / formalized I.T. Multiple I.T. systems and Information Flow systems work-arounds Schedule notification Multiple points across VSM Work not scheduled Material flow (via hollow Yes Sometimes arrow) WIP icon Inventory triangle In-bin (if preferred) Based on the time to process all of LT determination for each Based on a single item passing the accumulated WIP between block through the value stream process blocks Hands-on time to do the Cycle Time Process Time work Percent Complete & Accurate Quality Metric First Pass Yield (FPY) (%C&A) Applicable in areas with dedicated Takt Time Typically can be applied resources
- 49. How can we help? Karen Martin, President 7770 Regents Road #635 San Diego, CA 92122 858.677.6799 ksm@ksmartin.com Twitter: @karenmartinopex Blog & newsletter: www.ksmartin.com/subscribe
- 50. How can we help? • www.igrafx.com/lean • Custom Demonstration • Process Program Assessments www.igrafx.com/contact 503-404-6050
- 51. Thanks!