Seeing the Whole: Mapping the Extended Value Stream (Lean Enterprise Institute)

Seein

the Whole

by

Dan Jones

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Seeing the Whole Mapping

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By Dan

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LEAN

ENTERPRISE Massachusetts,

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Womack

Shook

LEI Breakthrough

Brookline,

Extended

Guide INSTITUTE USA

Value

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Wirb gtatitude to Dan Jones's colleagues at the Lean Entetprise Research Center, Cardiff University, in particular Nick Rich, Dave Brunt, Dave Simons and Matthias Holweg, who helped pionccr cxtcndcd value stream mapping. And with further gratitude to Dur reviewers, editors and designers (who bear no responsibility für the remaining faults): Jose Ferro, Bruce Henderson, Dave LaHote, Graham Loewy, Dave Logozzo, Bob Morgan, Guy Parsons,Atisa Sioshansi, Peter Tassi, Jeff Trimmer, Helen Zak, Maria Elena Stopher, and Thomas Skehan of Offpiste Design. And with special gratitude, as always, to John Shook.

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e Copyright 2002 The Lean Enterprise Institute, Inc.

P.O. Box 9, Brookline MA 02446 USA www.lean.org Version 1.0, March 2002 ISBN 0-9667843-5-9 All fights to the text and illustrations reserved by The Lean Enterprise Institute.

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Whenever there is a product fot a customer, there is a value stream.

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The challenge lies in seeing it.

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-Mike

Rother & John Shook, Learning to See

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When you have learned to see value streams in individual facilities, it's time to see and then to optimize entire value streams, from raw materials to customer.

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FOREWORD When the first item in the Lean Tool Kit, Learning to See,was launched in June of 1998, we at LEI began to hear from managers in many industries that "this is the tool we have been looking for." Readers quickly realized that the great power of Learning to Seelies in focusing attention on the value stream für individual product families within plants. Rather than concentrating on isolated processesalong the value stream or aggregated activities serving many value streams, readers could suddenly see how to optimize the flow of each product frorn.receiving to shipping. This insight was breathtaking für many managers caught up in narrow techniques or looking at only ODeactivity in a complex system. As more and more people heard about Learning to Seeand began to practice value stream mapping, we began to hear of additional needs. "How can we introduce continuous flow at the process level within facilities?" And, "How can we expand the scope of value stream 8

mapping beyond individual facilities to the extended value stream from raw materials to the end customer?" Many readers suspected that if there was vast muda within the walls of each facility there was even more muda between facilities and firms. We bad been thinking about this issue lang before June of 1998. Indeed, the initial outline of Learning to Seedevoted equal attention to mapping the extended value stream. However, we knew that extended mapping is more chaIlenging than facility-level mapping and we soon concluded that we would need severalpublications. In addition, we realized that managers would do weil to hone their skiIls by "Iearning to see" within a limited area before venturing forth to "see the whole". We therefore included a diagram in Learning to Seeillustrating different levels of mapping. We've recently addressed the process level wirb Mike Rother and Rick Harris' Creating Continuous Flow. In Seeing the Whole we rackle the higher, extended levels.

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process

level

Creating Continuous Flow

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plant

Learning to See

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Why is an extended map harderto draw?It's not becausethe fundamentalconceptis different. At every level of mapping,we are simply observingand writing down every step in information processingand physicaltransformationfür individual productfamilies.We

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observethe flow of customerdesiresmoving up the value stream,in the form of ordersor schedules,and then observethe progressof productsmovingdownstreamin responseto this information, from rawmaterialsto finished items.

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Extended m~ppingis harderbecausewe needto mapacrossplant, divisional,and company

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boundaries.In addition,we mustpar carefulattentionto the variabilityin orderand materials flows. Finally, we need to think ab°l!t untangling,simplifying, and "right sizing" complex logisticsand informationsystems,largefacilities,and high-scaleprocessingtechnologies manyvalue streamsand operated by manyfirms.

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Conductingextended mappingrequiresthe cooperationof manydepartmentsand divisions within firms and betweenfirms.These entities rarelythink aboutthe total flow of individual productsand orten hide informationfrom eachotherwhile pushingin oppositedirections. addition, extended mappingrequiresthat liDe managersdevotehard-to-sparetime to

.In .direct I .These I

observationof eachproductfamily'svalue stream.Failing this, higher-levelmapping easilybecomesa starrexercise(or a consultingproject)yieldingonly anotherreportthat's soonforgotten.

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additionaldimensionsof extendedmappingtruly arechallenges. However,we havebad considerablesuccessin overcomingthem, includingrecentinstancesduring the preparation of thisworkbook. We nowarecertainthat change-agent managerscanmeerthesechallenges and we know that time alreadydevotedto leamingto seeat the processand the facility levels

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will prove invaluableas youexpandyourfield of view.

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As wirb Learning to See,we hope usersof SeeingeheWho/ewill tell us how to improve this tool and will be willing to sharetheir experienceswirb the leaDcommunity.Numerous usersuggestions,basedon bands-onexperiencewirb value streammappingat the facility

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level, havepermitted us to improve Learning to Seeseveraltimes since its first publication. We look forwardto an intenseand continuingdialoguewirb the leaDcommunityon Seeing eheWho/easweIl.

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lohn Shook

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SeniorAdvisor, Lean EnterpriseInstitute Ann Arbor, MI, USA March 2002

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CONTENTS Forevvord

by .John Shook

Introduction: Part I: 8

Changing

Getting

Part 11: The

Your

Focal

Plane

Started

Current

State

Map

Part 111: Wh at Makes

an Extended

Part IV:

Future

State

1

Part V:

Future

State

2

Part VI:

The Ideal State

Part VII: Achieving

Future

Value

Stream

States

Conclusion .About

the Authors Appendix

A: Value

Appendix

B: Facility-Level

Current

Appendix

C: Facility-Level

Future

11III1 .,";

---

Stream

Mapping

Icons State State

Maps Maps

Lean?

-

INTRODUCTION Changing

Vour

Focal

Plane

For years now we have loved to "take a walk" along the entire value stream für a 8

given product, looking für value and waste. We've düne this für dozens of products in many industries and followed streams acrossthe world. We presented our first example in Lean Thinking (1996) when we drew the path of a humble cola can. This simple product with only three parts (barrel, top, and "pop-top") traveled 319 days through nine facilities owned by six companies in Tour countries to progress from are in the ground into the hands of the customer. Yet during this lang march only three hours of value creating activities were performed and the great majority of the sters -storing, picking, packing, shipping, unpacking, binning, checking, reworking, and endless movements of information to managethe system's complexity -created no value at all. Looking at the whole has always seemed natural to us and doing so will always

8

suggest ways to slashcosts while dramatically improving responsivenessand quality. Yet most managerswe have encountered on our value stream walks want to stand in Olle place and look at only Olle point -their machine, their department, their plant, th.eir firm. Orten, .t~e machine, the de~artment, the plant,. and t~~ fi~m are performmg weIl on tradltlonal measures -high labor and machme utu,zatlon, low defects, on-time shipments -and

the managersare pleased with their achievements.

However, when we ger managersto change their focal plane from their assetsand their organization to look at the product itself and wh at is actually happening on its lang journey, they immediately realize that the performance of the entire value stream is abysmally sub-optimal. lndeed, most wandet how they have worked für years in traditionally compartmentalized operations and somehow failed to notice the waste everywhere. Then they wonder wh at they can do about the mess.

And that is the big challenge. Managers find it easyand fun to drawextended current stare maps. And chis is a critical first step because it raises consciousness. But providing a management tool that permits the wagte to be removed permanently by achieving successivefuture grateshag been much harder. It was only when we first saw Mike Rother and John Shook drawing future state value stream maps at the facility level and coupling these maps to an action plan für implementation that we begin to see how we might guide groups of managers -für streams are spared acrossmany departments and firms -toward für entire streams.

all extended value similar results

In this breakthroughguide we present Dur method. It proposes a progression through two "future states" to an "ideal state" after the current stare is jointly identified and agreed. The first future state will be relatively easyand creates the 8

setting für the second. The second future grate is considerably harder and reaching the ideal state will require a major commitment by all the firms touching the product. Yet we believe that the savings in time and effort and the improvements in quality at every step will encourage teams tokeep going once they learn how to jointly optimize the shared stream. Eventually, wich same creative thinking about processand information technologies, we believe that most value streams can be compressed and smoothed to a point where a large fraction of the original steps and practically all of the throughput time are eliminated. This will be a true revolution and the value stream team getting there first will have an overwhelming competitive advantage. More important in mostcases, the team getting started first and making the quickest progress along the path will have a continuing competitive advantage.

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The key is to summon your courage, form your cross-departmentand cross-company team, and change your focal plane to focus on the product. Then learn to see the whole and ...ger going to take out the waste! We will be urging you on and waiting 8

to hear about your problems and successes.

Dan Jones and Jim Womack Ross-on-Wye, Herefordshire, UK and Brookline, MA, USA March 2002

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What

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An extended wasteful

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upstream

from the customer

relevant

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Value stream information

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being planned.

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compared

and response.

observing them

only difference

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of

visual/y,

and

with alternative

currently

in production

is that the "current

as they exist today while

shows the "business "future

as usual"

states"

state"

the

approach

and "ideal

to

states"

less waste and greater responsiveness.

whole

a Product point

Family

of value stream products,

mapping

where

is to disaggregate

they can be more

To do this you need to start at the furthest to be mapped will include

and to define

apower

drills

equipment

a common

as the last manufacturing

define

features

back upstream

be a major

family

might

Typically

similar

processing

product

the mapping

going iota the medium

family

steps and

For example:

a common

the finished

the customer)

a product

be medium-sized

labels. Alternatively

as the motor

(toward

to the customer.

chassis and passing through

a product

Mountaineer) component

outputs

downstream

passing through

issues to

electric assembly

cell

has many team might

drills

and map

from that point.

using a common power

a product

operational

easily acted on by managers.

at that point.

step, even though

family

the auto industry,

and Mercury

families

variants

and customer

the product

point

just prior to shipment

tools business,

utilizing

different

product

a group of product

using common

.In

of demand

better performance.

shows conditions

map für a new product

the product

circuit

process of directly

state with

in production

the leyel of specific

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(a) orders traveling

when forecasts substitute

value stream can be drawn für products

products

Selecting

.In

consist of two flows:

as they now occU1; summarizing

a future

map fOT a product

The

these constitute

of the extended

making

and

iota the arms of the

(or from the sales department

and materials

or für future

with

value-creating

from raw materials

actions to be mapped

mapping

then envisioning

"current

Mapping?

orders) and (b) products coming down the value stream from raw materials

to customer.

Maps

Stream

all of the actions -both

to bring a product

customer.

für confirmed

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Value

value stream is simply

family

produced

supplied

different

be a car platform

in an assembly

to auto assemblers

design architecture and with

might

and assembled attachment

points

plant.

-let's

(e.g., Ford Alternatively

Explorer it might

say an alternator

in acelI,

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hut with varying

für different

vehicles.

PART I: GETTING STARTED

1

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.In the aerospaceindustry, a product family might be an entire airframe

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(e.g.,the Boeing 737 or Airbus A320). Altematively, it might be a major subassembly,für example the vertical tail. The sub-assemblymay have many variants für different buyers of the completed aircraft. For example the tail

8: 8:

structure might incorporate different aerialsand fairings für navigation and communication equipment. And the products within the family chosen für

8:

mapping might differ slightly in dimensions. For example, the basic tail design might be slightly longer für use on a stretched airframe. However, the vertical tail clearly constitutes a product family becauseall variants

8:

follow the same manufacturing path and have no commonality wirb tails für other aircraft, even if they are made in other areasof the same facilities by the same firm utilizing parts from the same suppliers.

8: . -=

Note that the same product family may be supplied to a number of different

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end customers and have cosmetic differences causing the casual observer to overlook product commonality.Nevertheless from the standpoint of the firm or

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facility at the downstream end of the map, the product is clearly a family. Note also from the chart below that firms along similar value streams orten

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have complex relations wirb eachother. Delta supplies similar componentsto both Summa and Zenith; Omega fabricates similar parts für Delta and Azimuth; and Illinois Steel supplies materials to Theta and Zeta as weIl as Omega. Extended mapping cuts through this clutter to focus on just Olle streamin order to think of improvementsthat can eventuallyapply to an streams.

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Firms PlatformB along similar value streamsoften have complexrelationswith eachother.,

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Product

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a product family für an armature manufacturer (large armatures für alternators) is simply

.Olle

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Because the product family is defined from the vantage point of the final step mapped, the is essentially "fractai". That is, you can define product families from many starting points and map backward up value streams ofvarying lengths. For example, what appears to

8

.waste .that

of many component parts für an alternator producer (who might define a product family as large alternators). And the large alternator is just Olle component among many from the of the auto assemblerwho defines product families in terms of vehicle platforms. you select your start point and move back upstream, it is best für your first map to follow the path of a single family and a single component in the product. This is becausethe first objective of extended mapping is to achieve a breakthrough in shared consciousnessof and to identify systematic opportunities foT eliminating the waste. It is highly likely the wastes identified by following Olle component back upstream will occur in roughly

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equal measure in every component going iota the finished product. The alternative approach of mapping the value stream of every component going iota the product is time consuming and costly and we have found that it overwhelms managers with tao milch data.

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In subsequent rounds of mapping -if

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to work together and achieve useful results -additional maps can be created für many or all of the components and parts going iota a finished product. But to get started, keep it

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simple and focus tirst on achieving a breakthrough in raising your team's consciousness\

the collaborators in the mapping processfind ways

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PARTI: GETTING STARTED

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The idealmapwould tmly showthe whoie. That is, it would startwith the end customer who usesor consumesthe product.The mapwould then follow the product all the war up the value streamto moleculesin the ground (or in the recyclingbin), showingall the wastedactionsand informationlogsen route. However,just as trying to map all of a product'sparts backupstreamis overwhelming,trying to seetao rar wich your current vision f!lay be fruitless. We advisenovicemappersthat a lot canbe learnedby looking ODeor two facilities and firms upstreamfrom whereveryou start.This is the minimum scopeof extendedmapping.

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Even at this minimum scope, note that the scale of maps changes dramatically between Learning to See (facility-level maps) and Seeing the Whole. The facility boxes that are the primary units of analysis in this breakthrough guide are the samesize as the individual process boxes ("stamping", "welding", "assembly") in Learning to See.Vastexpanses of people and equipment within facilities have been shrunk into tiny boxes so we can see the big picture! In this guide, we will draw maps with an intermediate field of view, starting at the distribution center für the compfeted product and proceeding upstream to raw materials (e.g., rolls of steel). For those with more ambition and with full cooperation from upstream facilities and firms, it is both possible and desirable to start near the end customer and work far back upstream toward raw materials.

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Choosing

aLeader

and a Value

Stream

Team

We hope that you are experienced with facility-level mapping as described in Learning to Seeand have appointed value stream managers für all of the value streams within your facilities. We are convinced that this is critical to gain the füll benefit of mapping at the facility level. What's more, the knowledge of facility-level value stream managers will be invaluable für quickly drawing accurate mars of the extended value stream. However, by their nature, extended maps crossfacilities and firms. Suppose managersare in place für the segments of the stream within each facility.Who has the responsibility für direcrly managing the total stream acrossfirms, to connect the maps and lead the improvement process?The reality in most caseswill be "no olle". So there is a need für a new type of managerwho we will call the "Product Line Manager" (PLM).

The Product Une Manager

This individual in the most downstream firm needs to be much more than a technician concerned with Ollefacility. lndeed, für optimal results the Product Line Manager needs to be a business manager.This means "business" in the sense of taking Tesponsibility für making money and growing market share with the product family in question. And it means "manager" in the sense of looking concretely at the precise actions that need to be taken all along the value stream to remove waste and cost while improving quality and responsiveness. The most successful firms we have encountered using these techniques have Product Line Managers who think about product marketing and engineering as weil as production and purchasing. With all the elements of marketing, design, production, and supply chain under his or her oversight, this individual is in a unique position to judge the performance of the many functions touching the product. lndeed, as we will see in amoment, a continuing assessmentof functional performancealongwith precise prescriptions für improvement is Olle of the most important benefits of product line management. However, we do not usually recommend what is sometimes called a "product team" structure in which all of the engineering, operations, purchasing, and marketing employees supporting the product are put on a dedicated team. Doing this causesa large amount of organizational disruption during the transition and this structure still does not address the behavior of upstream partner firms. What's more, it is really not necessaryin most casesif the PLM takes an energetic approach to the job.

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Perhaps the best known example of what we are talking about in the manufacturing world today is the Chief Engineer für a car platform at Toyota (a job position also called the shusa). This individual is widely known by everyone in the company and takes responsibility für the successof the product in terms of return on investment and market share. Yet the Chief Engineer, like our proposedPLM, actually hag no direct authority over marketing (which is düne by a large marketing depanment), over engineering (which is düne by the various pans of the large engineering department), over production (wh ich is düne by the operations department), and over suppliers (who are managed by the purchasing department, and the production control and logistics depanment.) lnstead the Chief Engineer, working with a tiny group of assistants,is the Olle person who can "see the -whole" and think about the necessarycontributions from every functional activity and every upstream firm to create and deliver a successful product as judged by the end customer. The PLM in the most downstream firm will be even more effective if there are similar individuals in each of the upstream firms so that für any product a quick evaluation can be conducted by a small group composed of Olle PLM per firm. But this is not likely to be the case. lndeed, in today's world very few firms have tme PLMs. (One of our concerns in preparing this breakthrough guide hag been that the very managers most ahle to benefit from it don't currently exist in many firmst) Thus to get started, someone from Olle of the functional areas in the most downstream firm will probably need to take the lead and aim to .achieve a breakthrough in consciousness.This individual probably will have little formal authority für overseeingthe value stream and

I

will therefore need to lead by example and by raising hopes about possible joint gains. We can't guarantee that anyone anywhere along a value stream can succeed in raising every panicipant's consciousnessto transformthe entire stream.We can guarantee that anyoneanywhere can raisethe important issuesand make constructive changea possibility where it was previously impossible... if they have the courage to act.

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To be successful, the mapping leader needs to be someone who can gain the respect of upstream panners by conducting a rigorous and fair process. Logical candidates are from purchasing, production control, logistics, operations, or a process improvement function like quality or processengineering. Any of these can work. However, assigning a buyer from purchasing to be a mapping leader can lead to problems if upstream panicipants believe that the real purposeof mapping will be to uncover wagte at suppliers, followed by demands für immediate price reductions. Thus a purchasing function will probably need to assign mapping leadership to someone from its su-pplier development group if all participants are to be convinced that the process is fair, balanced, and aimed at Will-will-will outcomes. The value stream team needs to include representatives of all the firms and facilities that share ownership and management of the stream. Ideally, it would also include the relevant departments within each firm -sales, operations, production control and logistics, purchasing, manufacturing engineering, information management, and a ..stream

product engineering. However, this can make the team toD large to walk the value together, which is orten a critical learning experience. Thus we generally recommend a small team with a minimum of Olle representative per company. The team can query the functions supponing the value stream as necessaryto fill in missing information.

The

Wrang

Aole

tor

Consultants

and

Staffs

An understandable inclination in any firm with busy li ne managers -and this surely includes practically all firms -is to delegate the task of creating value stream maps to outside consultants or to interna I statt groups, typically in operations planning or process improvement departments. However, in Dur experience this is misguided. The findings of the consultant or statt expert are rarely credible to the managers who need to take action and the .consciousness raising experience of walking the value stream together -discovering the waste and jointly agreeing to a crossfirm action plan -simply never happens. A beautiful report is produced by theconsultant orstaff team -and in Dur experience the beauty and precision of the maps is generally inversely proportional to their usefulness -but the findings are then filed

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awayandsoonforgotten. Remember: Only managers taking clear responsibility can fix the mess. So the same managers ought to draw the maps.

8

"

Taking

a Walk

Once designated, the leader and the team need to take a walk together along the value stream, draw the current stare map, and then ask, "Which sters create value?, Which sters are waste?, Why is order flow so erratic?, Why is quality so erratic?,Why are deliveries so erratic?, How can value be enhanced foTthe end-customer?" Once the map is drawn so that the current state of an existing value stream is known precisely, it's time to create the first of two "future state" mars that remove wasted sters while stabilizing processesand simplifying information flows. Future State 1 achieves the future stare

.. a.

shown in Learning to Seewithin each facility touching the product. This means introducing continuous flow (as described in Creating Continuous Flow) wherever p~ssible and instituting smooth, leveled P ull between the areas of contmuous flow.

l d"'~;:; A

""

Future State Z then introduces smooth, leveled pull wich frequent replenishment loops between every facility touching the product. In the process, most warehouses are eliminated, or converted to cross dock operations. An Ideal Stare may then co-locate at Olle sire all of the activities required to proceed from raw materials to finished goods, in the processeliminating practically all transport links and needs foT information management. .You

mayor may not find this particular sequence appropriate foT your own value streams. In particular, if you are mapping a new value stream foT an entirely new product you will probably want to skip directly from the current (businessas-usual) state to an ideal state. We followthe three-step sequence, beginning wich Future State 1, in chis breakthrough guide because we believe that this is likely to be the most typical approach.

PART I: GETTING STARTED

9

.""," " ",i"

Tvvo Final A Diagnostic

Benefits tor Functions

As teams draw their current stare value stream mars, they are likely to make a surp!ising discovery. Most problems identified along the value stream will trace directly to the performance of various functions -information

technology, production control, logistics,

product engineering, operations, purchasing. What's more, weaknessesin functional performance discovered in the sampIe value stream will almost certainly be present in every other value stream the firms touch. In OUTexperience, the functions want to support the value stream für each product. But they have a hard time seeing the connection between their activities and the needs of the product. Thus an important benefit of the mapping process -in

18

addition to a breakthrough

~nconsciousnessabout the ~agnitude of waste ~nd the enormous o~portuniti~s für Improvement -can be to glve much clearer guldance to each functlon about Its Tale in supporting value streams. A real bonus can be achieved if the improved functional performance can then be applied to all value streams within the participating firms.

A Diagnostic

tor Relations

Bet\Neen

Firms

As teams start mapping, they are likely to make yet another discovery.Today we all use language stressing partnership and cooperation between firms sharing value streams. However, mapping teams in most caseswill discover an enormous gap between these high-level principles of collaboration and the dar-ta-dar reality down at the level of each value stream. If the value stream map shows widespread confusion and counterproductive actions between firms at the value stream level, it will be obvious that "partnership" at the top isn't translating into competitiveness at the bottom. 8

F ortunately, value stream mapping provides a clear and consistent language für firms to start an intelligent conversation with each other about the fOOtcausesof their shared cast, quality, reliability, responsiveness,an,dcommunications problems. (Indeed, we believe a relentless, fine-grained focus on improving each value stream, rather than high-level agreement on principles, is what has given Toyota its edge in creating the world's leanest supply base.)A real bonus can be achieved ifthe practicallessons of shared value stream management can then be applied by each firm to its relations with its other customers and suppliers.

10

!Ieii" "

.. ~~-

,

"'0

~

I

-

The Current With

State

the basic principles

stream

team creating

will characterize We've

decided

entirety

automotive

wiper consisting

product

bracket

component

of ablade

This

holding

product

used to illustrate

to map only an intermediate

final assembler then proceed

at the upstream of the finished

dock at Michigan

from the four firms development

sharing

Learning

family

Windshield

map

in the purchasing

at Gamma

portion

toward

we will

the facilities

to

(iron

Motors,

and Gamma

the We

Stamping

five-member

team,

will be led by the head of the

at Alpha Motors

Stream

runs its

end of the value stream.

and includes

the product

the value stream manager

and the sales manager

Value

which

map starts at Alpha

service center. The

plant manager at Beta Wipers,

Wiper

and variety

end to raw materials

of Beta Wipers

of the value stream,

Stamping,

in complexity

edge and the

to See.

the customer

department

with a small number

of a total value stream,

Steel, a raw materials

this portion

liDe manager and the assembly this product

a value

This

the actual wiping

is similar

portion

end. The

vehicle,

back up the stream through

to the shipping

family.

offered

from the end user (you in your car) at the downstream

ore in the earth)

supplier

in hand, it's time to accompany

stare fOT a specific

stream as it is today.

the blade to the vehicle. column

mapping

on a high-volume

windshield

the steering

8

the value

-a

arm attaching

We've

of extended

a map of the current

chosen tO'focus

of options

Map

at Michigan

fot

Steel.

Team

Information flow

.

.//::==~~~===~:::>;:==~~~:::--~:> ~ Michigan --Sales ,-

Steel

Gamma

Manager

Stampers

Beta Wipers

Alpha

--Product Une '" -Manager --A \" -Plant Manager

--Value Stream '" -Manager

Motors

--A Head of Supplier " -Development (Team Leader)

Material flow

/,/

PART11:THE CURRENTSTATE MAP

"'

.,~"

" , "'."",,"',,", ",,'"' ,j""",,

11

Windshield

Wiper

Assembly

and

Fabrication

Path

"

A

~

--

~

-~

,

~

8 ,

-~

,"

brackets

/

--~

.

~

stiffener and wiping edge

Windshield

Wiper

Assembly

and

Fabrication

A. Rolled steel stamped into blade spine B. Four brackets attached to blade spine

/

12

~

C.

Wiping

edge attached

D.

Blade assembly

to blade spine and brackets

attached

to arm

E. Assembled wiper attached to automobile

assembly

Steps

~

i

Before we start mapping, let's look at an exploded view of this product showing the parts going into the wiper and its fit-point on the end product. Note that we will only map the circled area in this initial map. This is to keep the map simple and to concentrate initially on raising everyone's consciousnessof the extended value stream.

-.~

#

-]

/

arm components

8

""D ;;;;

~

::::.~

E

"" 8

/

Cj

., , ,""

"'

'01'"

-~

OUTwindshield wiper comes in two specifications-high (HT and 8T) -and

in two sizes -small

-

trim and standard

and large (8 and L) -to

fit

two different vehicles (A and B). The fight-hand and left-hand wipers are identical on the vehicles in this example. The trim levels differ only in the'paint -a matte-black finish für the standard trim vehicles and a glossy-black finish für the high trim models. The designs für the two models differ only in the size of the parts, not in their number or basic design. This means that the wipers are interchangeable from a final assembly standpoint because they use the same fit points and require the same installation time. The wipers clearly form a product family e

because all of the actions occurring upstream -component assembly, painting, and stamping -are in the same processsequence in the same firms and use the same processing equipment with a few tool and fixture changes. With the product family clearly identified, the first step für the team is to "take a walk" along the entire length of the value stream to be mapped, recording the facilities visited, the transport links, every action peiformed on the product, all information management actions, and the time required. We always suggeststarting at the customer end because the customer is the point -indeed, the only point -of these material flows. No product should be advancing that the customer doesn't want and nothing should be happening that the customer doesn't considerofvalue! For the wiper example, the list of actions on the product isshown in the

8

following list. Note that we have numbered all of the steps (73) in the left-hand margin of the list and compared these with value creating steps (8) in the first column on the fight. We have also recorded the total elapsed time (total product cycle time) wh ich sums the time required to conduct all ofthe steps on a product (44.3 days) and compared this time with the actual value creating time (54,], minutes), which is the sum of only the value creating steps.

14

",..

"

,,""""'A

"""""",""

Physical Total

.6.

.10.

.22.

Actions

Required

to Create

Steps

a Windshield

Wiper

Value

Total

Value

Creating Steps

Time

Create Time

Raw Materials Supplier: Michigan Steel, Dearborn Heights, MI 1. Load coils for twice weekly direct ship

10m

Transport Link 1 2. Direct ship (tru~ck), Tonawanda, NY (500 miles)

8h

Second- Tier Supplier: Gamma Stamping, Tonawanda, New York 3. Unload coils 4. Receive & create ticket 5. Store coils Convey coil to Stamping Press 1 7. Mount on coil roller and feed press 8. Stamp initial (flat) shape 9. Accumulate stamped parts during run Convey parts bin to storage 11. Store parts 12. Convey parts in bin to Stamping Press #2 13. Load parts in magazine, auto feed to press 14. Stamp final (curved) shape 15. Accumulate parts during run 16. Convey parts to storage area 17. Store parts 18. Convey parts to paint shop 19. Rack parts on moving conveyor, clean, dip, paint & bake 20. Remove parts, inspect, sort & accumulate in bin 21. Convey parts to storage Store parts prior to shipment 23. Load parts for twice weekly direct ship

2

3

10m 10m 14d 10m 5m 1s 4h 10m 48h 10m 10m 10s 4h 10m 48h 10m 130m

1s

10s

52m

2h 10m 48h 10m

Transport Link 2 24. Direct ship (truck) to Harlingen, TX (1500 miles)

96h

First-Tier Supplier Warehouse: Beta Wipers, Harlingen, TX 25. Unload 26. Formally receive 27. Store parts 28. Retrieve and load truck for daily direct ship

10m 10m 48h 10m

PART 11: THE CURRENT

STATE

MAP

15

I

.""c.,

",~'"c

c

"

Total

Steps

Value

Total

Creating

1ime

Steps

Value

Create 1ime

Transport link 3 29. Direct ship (truck) to Reynosa, Mexico

6h

(100 miles with queue at border check point)

.38.

-42.

First Tier Supplier Assembly Plant: Beta Wipers, Reynosa, Mexico 30. Formally receive and move to storage area 31. Store in receiving storage area 32. Convey from storage area to first assembly step 33. Store at first assembly step 34. Insert fastener clip and secure with pin 35. Accumulate parts in first assembly step 36. Convey parts to second assembly step 37. Store at second assembly step CIasp wiper blade assembly to sub assemblies 39. Accumulate parts in second assembly step 40. Convey parts to third assembly step 41. Store at third assembly step Insert wiping edge in blade assembly 43. Accumulate parts from third assembly step 44. Convey parts to inspection, test & pack step 45. Store parts at inspection & test 46.Conduct inspection, test & pack in protective sleeve 47. Accumulate parts at pack 48. Convey parts to shipping dock 49. Store awaiting shipment 50. load truck tor daily direct ship Transport Link 4 51. Ship by truck to Harlingen, TX (100 miles with queue at border check point)

8

5

6

10m 48h 10m 8h 10s 4h 10m 8h 10s 4h 10m 8h 10s 4h 10m 8h

10s

10s

10s

20s 4h 10m 12h 10m

6h

First-Tier Supplier Cross-Dock: Beta Wipers, Harlingen, TX 52. 53. 54. 55.

Unload truck Cross-Dock Store awaiting full truck Reload truck tor daily ship

Transport Link 5 56. Ship via multi-pick-up

10m 10m 12h 10m

route (truck) EI Paso, TX

96h

(600 miles)

16

'" ".~ .,

J.

Total

Steps

Gar Company Cross-Dock: Alpha Motors, EI Pa so, TX 57. Unload truck 58. Cross-Dock 59. Store awaiting full truck 60. Reload truck for daily direct ship

Value

Total

Value

Creating Steps

Time

Create Time

10m 10m 12h 10m

Transport link 6 61. Direct ship to West Orange, NJ by truck

96h

(2000 miles) Gar Company's State Street Assembly Plant: Alpha Motors, West Orange, NJ 62. Formally receive 63. Convey to storage area 64. Store awaiting need 65. Convey to kitting area 66. Transfer to assembly bins 67. Store in assembly bins awaiting need 68. Assemble wiper blade in holder to arm 69. Attach wiper arm with blade to vehicle 70. Une off vehicle and test 71. Store finished vehicles 72. Load train for daily direct ship

8

Transport link 7 73. Ship to Cleveland Distribution

7 8

Center by train

10m 10m 48h 10m 10m 2h 1m 1m 10m 12h 2h

1m 1m

12h

(500 miles)

8

Summary

of Physical

Actions Value

Total

Steps

73

Time

44.3 Days

Distance

5300

. Creatlng 8

54.7 Min.

Miles over 7 Transport

Unke

PART 11:THE CURRENT STATE MAP

17

1111!~t

!I

-"

"...,, ,.-

Learning

to

See

Value

As we write down the actions, the ability to distinguish value-creating steps from currently necessarybur wasteful steps and value-creating time from currently necessarybur wasted time is critically important. The enormous gap between total time and value-creating time and between total actions and value-creating actions is the opportunity the value stream team must geize. Given the importance of telling the difference between value and waste, it is not surprising that we orten encounter readers and audiences who are anxious about their ability to categorize actions correctly. Actually, it is very simple. Pur yourself in the position of the consumer and ask if you would par less für the product or be less satisfied wirb it if a given step and its necessarytime were left out. In the case of attaching the wipers to the vehicle in the Alpha assembly plant, the .answer

is clear. Consumers do not expect to receive their vehicles wirb the wipers in the front seat, accompanied by a polite note stating, "Some assemblyrequired". The final attachment step clearly creates value für the customer. So do the seven actions of stamping the metal arms, painting them, and sub-assembling them prior to attachment on the vehicle. By contrast, look at the many movements of the product within each plant between process steps, the lang transport links between plants, the warehousing and crossdocking activities along the value stream, the numerous testing and inspection steps, and the repeated packing and unpacking of the product. Would rau, as a consumer, be less satisfied with your vehicle if these currently necessaryactivities could somehow be left out? Of course not. And would you be happier if the car company could ger you the model you want wirb the trim level you want quicker because these steps were left out? Of course you would. lndeed, the more these steps cause a delay in receiving exactly the product you want, the less you probably

8

are willing to par für it. Far from creating value, these shipping, packing, inspecting, and warehousing actions actually destroy it!

Dravving a Useful Map The lang list of steps, categorized by wagte and value, is highly provocative because it helps the team realize the enormous opportunity für savings.What's more, the ratios of value-creating time to total time (54.7 minutes out of 63,792 or 0.08%) and of value-creating steps to total steps (8 out of 73 or 11%) and the amount of transport distance (5300 miles) are quite typical für discrete manufactured products in the world today. Our example is the norm, not the exception, and similar ratios are likely to emerge from any maps you draw.

18

.m

First Vievv of the Current Shovving the Customer

State

Map

~

Distribution I~ha Center

Cleveland.OH 960/ Day 640A 426ST 214HT 3206 213ST 107HT

8

6 -the

However, für this information to be useful we need to simplify it and put it in a form managers can act on. The best war to do this is to group and summarize the data by each of the facilities and transport links the product encounters. Again, the place to start is with customer, at the most downstream end of the map. In this case, the customer is the Alpha Motors Distribution Center, wh ich interacts with car dealers to get end consumers the products they want. We'll represent this organization with a facility icon placed on the fight side of the map. Underneath this icon we'll draw a data box recording the customer requirement für size and frequency of shipment. Note that this facility is a cross-docking operation where vehicles are sorted and sent onward as quickly as possible to several regional storage areas across North America. From there they go to auto retailers and then into the hands of the customer. Thus our intermediate-view map stops considerably short of the total value stream map that it may be useful to draw at some point in the future.

PART 11:THE CURRENT STATE MAP

". , ..,.

.."'"

:11

:.""",..

.,",.

19

l~:~;;;:~:;::J Ser~iceCo: I Dearborn Heights, MI

8

@

Gamma

Stamping Tonawanda, NY

8

~

Warehouse eta Wipers

~

Beta Wipers

.Assembly Harlingen,

TX

Reynosa ' Mexico

To get from raw materials to the Alpha Distribution Center, the product flows through seven assembly, fabrication, warehousing, and cross-dockfacilities. These are: .Alpha Motors' State Street Assembly Plant in West Orange, New Jersey .Alpha Motors' Cross-Dock, für many componentsfrom many suppliers,in EI Paso,Texas .Beta Wipers' Cross-Dock, für parts sent from several plants to many customers, in Harlingen, Texas .Beta Wipers' Component Assembly Plant in Reynosa, Mexico .Beta Wipers' Parts Warehouse in Harlingen, Texas .Gamma Stamping's Stamping and Painting Plant in Tonawanda, New York .Michigan Steel's Service Center in Dearborn Heights, Michigan

20

",,"..

"

Current

State

Map

Shovving

All

Facilities

OO Di5trlbution Ir;1ha Center

Cleveland, OH 960 I Day

~ ~

640A 4265T

8

eta Wipers

IPha Motors

Cross-Dock

Cros5-Dock

~

--c:::

--~

Harlingen, TX

EI Pa5o, TX

214 HT

:3206 21:35T 107HT

§]

AlphaMotor5

A55embly

We5t Orange,NJ

We have created two new facility icons not seen in Learning to See. Olle is a cross-dock 8

icon fot facilities where products are not stored butinstead moved immediately flom an incoming vehicle to an outbound shipping lalle. The other is a warehouse icon für facilities where incoming goods are sorted and stored before shipment to their next point of use. (The icons used in this workbook are displayed on the inside back cover and explained in Appendix A.) You may want or need to create other icons, of course, in particular für activities not encountered in OUTexample.]ust make sure that everyone working on the extended map uses the same icons.

PART 11: THE CURRENT

I 111I1 111m ""

"

"

"

STATE

MAP

21

r;:;:~~~-::J 15~~i~e -c~~ -J Dearborn Height5. MI I

8

5teel Coils

I

S

Stamping Gamma

Tonawanaa, NY

l::;:=J Warehou5e eta Wiper5

. Harlingen. TX

RM:3:36h.

RM56h.

WIP110h.

WIP41 h.

FG48h.

FG12h.

:3 5hifts

25hift;s

5 Days

5Da

EPE =:3 Days Defects = 2000

s

EPE = 1 Day Defects

ppm

400

=

ppm

You will soon discover that you can't successfully gather and summarize the information 8

needed für improving the value stream without drawing detailed current state in-facility value stream maps für products as they move through manufacturing facilities. This is why mastery of the material in Learning to Seeis aprerequisite für macro-mapping. We've drawn current state facility-level maps für the three manufacturing facilities along this value stream -Gamma Stamping, Beta Wipers Assembly, and Alpha Motors Assembly -in Appendix B of this workbook, and you'll wantto append your facility-level maps to your current state macro map as weIl. Note that the data box under each facility contains data on inventories (Raw Materials, Work-ln-Progress, Finished Goods), the amount of productive time (the number of shirts per dar and the number of working days per week), the frequency of the production cycle (showing höw orten every part is made, such as

22

"

1,1

Current State Map and Data Boxes

Shovving

All

Facilities

OO DistrIbution I[Jha Center

Clevelana, OH 960

I Day

640A

~ ~

426ST 214HT

a.

:320B

.,

eta Wipers Cross-Dock

--c

~

IPha Motors

Cross-Dock

--c

~

Harlingen, f)(

EI Paso, f)(

21:3 ST 107HT

EI

Alpha Motors

Assembly

West Orange, NJ

RM50 h. WIP2h. FG14h. 2Shlfts 5 Days EPE = 1 Day Defects

=

5ppm

8

"EPE = 1 Day" meaning "every part every day"), and the defect level (in parts per million) asreported by the customer at the next downstream facility (or by the customer's inspector at the point of shipment in the case of the Alpha Motors Assembly Plant.) We have not drawn facility-level maps für the Alpha and Beta cross-docksand für the Beta parts warehouse.This is partly to keep the size of this guide manageableand also becausewe will endeavor to eliminate these facilities altogether as we move through progressive future states. If your value streams will require large distribution warehouses in any imaginable future state -für example für service parts -or cross-docks,you should also draw maps ofthese facilities as a guide to improving their performance. Exactly which facilities merit in-facility maps and in what detail will always be a matter of judgment, so be prepared to adjust your approach as your experience accumulates and you encounter different situations.

PART 11: THE CURRENT

STATE

MAP

23

'c.,".".","" "..,."." ",c", ""...""""M"""""""

-

The Quality

Screen

As we look at the data in the facility boxes, we note a trend worthy of further examination. At Alpha Motors Assembly the defect rate für wipers installed on the vehicle -defects discovered by a representative from Alpha's Distribution Division in a final inspection just prior to shipment -is 5 per million. (Since Alpha is assembling 250,000vehicles per year wirb two wipers per vehicle, this means that two to three wipers per year are rejected at final inspection, usually für scratches in the finish.) Yet when we look at defects emerging from Beta Wipers Assembly (as judged by Alpha), we note that there are 400 defects per million and when we look at defects emerging from Gamma Stamping (asjudged by Beta) we note that there are 2000 defective parts per million. Finally, when we look at defects arriving at Gamma from Michigan Steel the figure soarsto 10,000 per million. In brief, quality is Würgeat every ster up the value stream, a common phenomenon in 8

practically every industry today. This means that to achieve 5 defectsper million (approaching the Six Sigma level of 3.4 defects per million), the product is flowing through aseries of quality screens in each facility, each of wh ich results in scrapand inspection cast. The slope of this quality gradient can surely be reduced in future states and it is important to note carefully the current slope to aid OUTthinking on how to do this. We therefore recommend drawing a Quality Screen (as shown below) on the Current Stare map. In this casewe have placed the diagram in a convenient spot in the lower fight-hand corner.

Quality ppm defects

Screen

t MICHIGAN 10,000 TaGAMMA

8

0

24

.,

.:";,i:...,:!:

I

I i

I

Mapping

the

Transport

Links

The next step, once the facility-level maps are drawn and the data have been summarized in facility boxes, is to add the transport links between the facilities. To do this, you may need boat, train, and airplane icons, in addition to the truck icon from Learning to See. In this example, we will use the airplane icon with a dotted line fOTshipments expedited by air and a truck icon with the same style of dotted line für those expedited by truck. The numbers in the regular shipping icon (a truck or a train) show the frequency of shipments (e.g., "1 x day" = ODeshipment per day) while the number in the expediting icon shows the number of cosclyexpedited shipments in the past year (e.g., "2 x year" = twice a year). With these data in hand, we are ready to complete the physical flow portion of the map by drawing in the normal product flows between facilities, using broad arrows..Note that these are striped, "push" arrowsbecauseproducts are moving ahead at the command of a centralized information system and not necessarily in accord with the immediate needs of the next 8

downstream facility. Under each of the transport links we record the distance in miles, the shipping batch size, and the percentage of defective deliveries as reported by the customer. As these flows are drawn, the team should note Olle additional point -the

trend in

defective shipments: late, early, or incorrect (the wrong product or in the wrang amount). As is also typical in most industries today, we note that the further up the value stream a facility is, the more likely it is to make defective shipments. This situation is analogous to the quality gradient and equally worthy of improvement in future states because every defective shipment generates correction costs downstream and perturbs the schedule. For economy of space we have summarized this trend in the same box as the quality data on the Current State map, changing the label to the "Quality and Oelivery Screen".

Delivery ppm

defects

Screen

t 10,000

MICHIGAN TO GAMMA

8 % defective deliveries

defective deliveries

0

PART 11:THE CURRENT STATE MAP

25

""CL.".","

...

l

--

The

66Bottom

Line6'

Finally, we can draw a time-and-steps liDe along the bottom of the map. Note that the first figure above each segment of this liDe is the total time within each facility and along each transport link, while the figure in parentheses to the fight is the value creating time. The first number below each segment of the liDe shows the total actions (steps) taken on the product in each facility and transport link, with the value creating actions shown to the fight in parentheses.Note that information needed für each facility is contained in the "Steps" and "Time" summary boxes at the ends ~f tht/ time-and-steps liDes on the individual facility maps.

~:~~~::J l~r~ic~~~~~-1 DearbornHeights,MI

~ ... '\ ~. .r~

..~~ 6x

~

2x

Year

..Gamma

~

Week

@ Stamping Tonawanda, NY RM:3:36h.

~

Day

.tJ;~e'h"~E~~S ~ . ~

I-"--'::-.~.

.~.~

Ix

~

Beta Wipers

I-_.j-'-~

Harilngen, TX .x

.2xYear

Assembly

~~

Year

Ship 6atch = 72 Colls .ays

-oJ

Defective

=

Ship 6atch D

100 m. Shi 6atch p

= :36 Pallets

O.3d. STErS

=

6%

=

Total -22 Sters

-73

Pallets

EPE -1 Defects

400

1

(3 )

12

Defective = 6%

4.0d.

1

100 m. Ship 6atch

-=

Defective

Defects = 2000 ppm

'8

5 Da s

ays

8%

..

FG12h. 2 Shifts

1500 m.

5 D EPE -~

Reynosa, Mexico... WIP41h.

FG48h. :3 Shifts

m.

~

r::I:J:-=D~

RM56h.

WIP110h. 500

1x

y

Da -Defective ppm

O.25d. 2.0d.

1

4.6d.(30s.)

4

21 (3)

Value Creating = 8 Sters

26

" "

6

Pallets

-

= :3%

! Current Defects

State Shovving all Facilities, Transport & Delivery, and Time-and-Steps Line

Links,

I

8

OO Distribution I~ha Center

Cleveland.OH 960 I Day

640A

~~ ~ x Day

Cross.[fock eta Wi erg

--c -